Powell Industries (POWL) AI Stock Analysis

• Market Cap: $6.36B
• Dividend Yield: 0.32%
• Average Volume (3M): 280.30K
• Price to Earnings (P/E): 34.0
• Beta (1Y): 2.07
• Revenue Growth: 9.08%
• EPS Growth: 19.86%
• Country: US
• Employees: 2,748
• Sector: Industrials
• Sector Strength: 72
• Industry: Electrical Equipment & Parts
• EPS (TTM): 3.40
• Shares Outstanding: 12,142,283
• 10 Day Avg. Volume: 198,939
• 30 Day Avg. Volume: 280,302
• PEG Ratio: 1.03
• Price to Book (P/B): 5.74
• Price to Sales (P/S): 3.33
• P/FCF Ratio: 23.75
• Enterprise Value/Market Cap: 0.92
• Enterprise Value/Revenue: 5.27
• Enterprise Value/Gross Profit: 17.45
• Enterprise Value/Ebitda: 24.76
• 1Y Price Target: $506.00
• Price Target Upside: -3.36% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): 16.18
• Revenue Forecast (FY): $1.19B

• Rating: 81 Outperform
• Price Target: $649.00 ▲(23.95% Upside)
• Action: Reiterated Date: 02/19/26
• Date: Action: Reiterated 02/19/26

The score is driven primarily by exceptional financial strength (rapid growth, high and expanding margins, and near-zero leverage) and supportive earnings-call fundamentals (record backlog and strong bookings). Offsetting this are stretched technical momentum signals (overbought) and a relatively expensive valuation (P/E ~38 with a low dividend yield).

Positive Factors

Scale and Margin Expansion

POWL has materially larger scale and structurally higher margins versus recent years, reflecting operating leverage in project execution and pricing. Sustained revenue near $1.1B and mid-to-high twenties gross margins provide durable earnings power if management sustains project execution and pricing discipline.

Conservative Balance Sheet & Cash

Extremely low leverage and a large cash position give Powell flexibility to fund capex, facility expansion, working capital swings, or opportunistic investments without stress. Strong ROE alongside minimal debt signals durable capital efficiency and low solvency risk over the medium term.

Record Backlog & Diversified Wins

A record $1.6B backlog and outsized quarter of new orders, including large LNG and data‑center awards, enhance revenue visibility and diversify end markets. Secular demand in utilities, LNG and hyperscale data centers supports multi-quarter project pipelines and repeatable aftermarket opportunities.

Negative Factors

Backlog Conversion Risk

While backlog is large, only ~60% is expected to convert in 12 months, creating material timing and revenue visibility risk. Delays or non-conversion can produce lumpy results, unpredictability in cash flow and underutilized capacity, challenging investors' near-term growth expectations.

Skilled Labor & Capacity Constraints

Execution depends on specialized engineers and skilled shop labor; shortages can delay projects, increase subcontracting costs and SG&A, and force capital spend for facility/hiring. Persistent staffing constraints risk slower backlog conversion and pressure on margins over multiple quarters.

Raw Material Input Volatility

Long-cycle, custom projects expose Powell to copper and steel price swings. Hedging is partial, and contract change orders or passthroughs may lag, creating margin volatility. Persistently higher input costs could erode project profitability and require more frequent price adjustments.

Powell Industries Business Overview & Revenue Model

Company Description

Powell Industries, Inc., together with its subsidiaries, designs, develops, manufactures, sells, and services custom-engineered equipment and systems for the distribution, control, and monitoring of electrical energy. The company's principal products include integrated power control room substations, custom-engineered modules, electrical houses, medium-voltage circuit breakers, monitoring and control communications systems, motor control centers, and bus duct systems, as well as traditional and arc-resistant distribution switchgears and control gears. Its products have application in voltages ranging from 480 volts to 38,000 volts; and are used in oil and gas refining, onshore and offshore oil and gas production, petrochemical, liquid natural gas terminals, pipeline, terminal, mining and metals, light rail traction power, electric utility, pulp and paper, and other heavy industrial markets. It also provides value-added services, such as spare parts, field service inspection, installation, commissioning, modification and repair, retrofit and retrofill components for existing systems, and replacement circuit breakers for switchgear. The company has operations in the United States, Canada, the Middle East, Africa, Europe, Mexico, and Central and South America. Powell Industries, Inc. was founded in 1947 and is headquartered in Houston, Texas.

How the Company Makes Money

Powell Industries generates revenue through the sale of its electrical equipment, including switchgear and control systems, which are essential for managing electrical power in industrial settings. The company's revenue model is primarily based on project-based contracts, where they provide engineering, procurement, and construction services to clients in their target sectors. Key revenue streams include the sale of custom-built electrical distribution systems, ongoing maintenance and support services, and aftermarket parts. Strategic partnerships with major industrial players and collaborations with engineering firms enhance their market reach and contribute to revenue growth. Additionally, as industries increasingly focus on safety and efficiency, Powell Industries benefits from increased demand for its high-quality, reliable electrical solutions.

Powell Industries Financial Statement Overview

Summary

Very strong operating performance with rapid revenue growth (TTM ~$1.11B, +88.3%) and materially higher profitability (TTM gross ~30.2%, operating ~20.6%, net ~16.8%). Balance sheet is exceptionally conservative with minimal debt (~$1–2M) versus equity (~$669M) and strong ROE (~30.6%). Cash flow is solid (TTM FCF ~$161.5M; ~92.6% of net income) but has been somewhat volatile and operating cash flow has lagged EBIT, suggesting working-capital timing swings.

Income Statement

POWL shows a sharp step-up in profitability and scale. TTM (Trailing-Twelve-Months) revenue reached ~$1.11B with very strong growth (88.3%), while margins expanded materially versus prior years: gross margin ~30.2%, operating margin ~20.6%, and net margin ~16.8%. Annual results also show clear multi-year momentum (revenue from ~$533M in 2022 to ~$1.10B in 2025) alongside rising profitability, indicating strong operating leverage. Key watch-out: the most recent growth rate is exceptionally high and may normalize, so sustaining these elevated margins and growth will be important.

Balance Sheet

The balance sheet is exceptionally conservative with minimal leverage: total debt is ~+$1–2M against ~$669M of equity in TTM (Trailing-Twelve-Months), implying extremely low balance-sheet risk. Equity has increased substantially over time (from ~$297M in 2022 to ~$641M in 2025), and returns on equity are strong (TTM ~30.6%), signaling high profitability without relying on debt. The main limitation is that the data provided does not include liquidity working-capital details, but based on leverage and returns alone the financial position looks very strong.

Cash Flow

Cash generation is solid and aligns reasonably well with earnings: TTM (Trailing-Twelve-Months) operating cash flow is ~$174.5M and free cash flow is ~$161.5M, with free cash flow running at ~92.6% of net income—generally a healthy conversion rate. Cash flow performance has improved meaningfully from 2021–2022 (when operating and free cash flow were negative), but it has been more volatile year-to-year (e.g., 2023 unusually strong, 2024 lower, then 2025 higher again). One cautionary signal is that operating cash flow is less than half of EBIT in recent periods, which can indicate working-capital investment/cash timing effects that may continue to fluctuate.

Breakdown	TTM	Sep 2025	Sep 2024	Sep 2023	Sep 2022	Sep 2021
Income Statement
Total Revenue	1.11B	1.10B	1.01B	699.31M	532.58M	470.56M
Gross Profit	336.27M	324.38M	273.09M	147.55M	85.02M	75.06M
EBITDA	236.98M	240.81M	185.64M	71.13M	16.58M	11.35M
Net Income	187.37M	180.75M	149.85M	54.52M	13.74M	631.00K
Balance Sheet
Total Assets	1.09B	1.11B	928.18M	752.24M	493.38M	436.19M
Cash, Cash Equivalents and Short-Term Investments	500.84M	475.53M	358.39M	279.01M	116.51M	133.98M
Total Debt	1.46M	1.66M	1.22M	1.44M	2.32M	4.23M
Total Liabilities	425.48M	468.21M	445.11M	407.22M	196.17M	134.97M
Stockholders Equity	668.89M	640.77M	483.07M	345.03M	297.21M	301.22M
Cash Flow
Free Cash Flow	161.51M	154.79M	96.68M	174.73M	-6.03M	-33.35M
Operating Cash Flow	174.50M	167.94M	108.66M	182.55M	-3.58M	-30.46M
Investing Cash Flow	14.08M	-8.34M	-21.87M	-26.57M	6.46M	-2.46M
Financing Cash Flow	-27.21M	-25.12M	-19.25M	-13.06M	-13.31M	-13.17M

Powell Industries Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 523.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For POWL, the sentiment is Neutral. The current price of 523.6 is below the 20-day moving average (MA) of 539.07, above the 50-day MA of 441.01, and above the 200-day MA of 311.31, indicating a neutral trend. The MACD of 27.81 indicates Positive momentum. The RSI at 53.91 is Neutral, neither overbought nor oversold. The STOCH value of 23.81 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for POWL.

Powell Industries Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
POWL	81 Outperform	$6.36B	34.01	32.16%	0.32%	9.08%	19.86%
ENS	77 Outperform	$6.12B	20.57	16.74%	0.67%	6.17%	20.86%
NVT	77 Outperform	$19.14B	45.47	12.30%	0.84%	5.31%	5.76%
PLPC	69 Neutral	$1.24B	33.61	8.33%	0.35%	15.93%	12.72%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
TE	56 Neutral	$1.67B	-1.63	-55.98%	―	―	-394.37%
ATKR	55 Neutral	$2.18B	-46.52	-3.23%	2.02%	-10.98%	-103.99%

Powell Industries Corporate Events

Powell Industries Shareholders Back Board, Executive Pay Plan

At its annual meeting of stockholders on February 18, 2026, Powell Industries shareholders re-elected directors Alaina K. Brooks and Katheryn B. Curtis to terms running through fiscal 2029 and approved, on an advisory basis, the company’s executive compensation program. The voting results showed strong support for both the board nominees and the say-on-pay proposal, and on the same date the board appointed Mark W. Smith as chair of the audit committee, succeeding Christopher E. Cragg and signaling continuity in the company’s governance and oversight framework.

The most recent analyst rating on (POWL) stock is a Buy with a $675.00 price target. To see the full list of analyst forecasts on Powell Industries stock, see the POWL Stock Forecast page.

Powell Industries posts strong Q1 results, boosts backlog

On February 3, 2026, Powell Industries reported first-quarter fiscal 2026 results for the period ended December 31, 2025, posting revenues of $251.2 million, up 4% year on year, gross profit of $71.4 million or 28.4% of revenue, and net income of $41.4 million, or $3.40 per diluted share, up 19% from the prior-year quarter. New orders surged 63% to $439 million, driving backlog to $1.6 billion, with particularly strong momentum in the Commercial & Other Industrial segment, including the company’s first data center megaproject and a major LNG project on the U.S. Gulf Coast, while a cash and short-term investment balance of $501 million and no debt underscore a strong balance sheet that management says positions Powell to sustain solid margins and capitalize on growing demand for electrical infrastructure across utilities, LNG and data centers; the board also declared a quarterly dividend of $0.27 per share, payable March 18, 2026 to shareholders of record as of February 18, 2026.

The most recent analyst rating on (POWL) stock is a Buy with a $490.00 price target. To see the full list of analyst forecasts on Powell Industries stock, see the POWL Stock Forecast page.

Powell Industries Enhances Executive Incentive Plan and Metrics

On January 2 and 3, 2026, Powell Industries’ board-level Compensation and Human Capital Committee approved supplemental restricted stock unit awards for CEO Brett A. Cope and CFO Michael W. Metcalf, augmenting their October 1, 2025 grants as part of a revised fiscal 2026 long‑term incentive program. The committee shifted to setting award size by fixed dollar targets rather than as a multiple of base salary, raising Cope’s target to $2.2 million and Metcalf’s to $600,000, and rebalanced Cope’s mix toward 60% performance-based and 40% time-based units, while keeping Metcalf’s at an even split. Although vesting terms largely mirror prior grants, the performance-based units now incorporate a three-year revenue compound annual growth rate metric alongside existing EBITDA and safety goals, signaling a stronger emphasis on growth and performance alignment in executive pay, with implications for how leadership incentives are tied to the company’s long-term financial and operational outcomes.

The most recent analyst rating on (POWL) stock is a Buy with a $387.00 price target. To see the full list of analyst forecasts on Powell Industries stock, see the POWL Stock Forecast page.