Powell Industries, Inc.

Powell Industries, Inc. (POWL) recently reported its fourth consecutive surprise on record earnings and revenues. Shares have responded and are trading at good valuations.

Company Description

Powell Industries, Inc. sells, designs, develops, manufactures, packages and services systems and equipment for the distribution, control and management of electrical energy and other dynamic processes. The principal products are switchgear and related equipment, bus duct and process control systems.

These products and systems are utilized primarily by refineries, petrochemical plants, utilities, paper mills, offshore platforms, commuter railways, vehicular transportation and numerous other industrial, commercial and governmental facilities.

Fourth Consecutive Surprise

Powell reported record revenues and earnings in fiscal 2008 when it made its latest announcement on Dec 10. Quarterly revenue was $167 million, up from $151 million one year ago.

Earnings per share were 72 cents, easily beating the Street's estimate of 57 cents. The 26% surprise was the company's fourth consecutive surprise with an average of 34% each time.

Optomistic Outlook

Powell also released its forecast for full-year 2009 results, which included earnings between $2.60 and $2.85. Full-year earnings for 2008 came in at $2.26.

CEO Patrick McDonald said "We enter 2009 with a backlog that provides the ability to reach even higher levels of performance."

A Good Value

Shares of POWL are trading at a good value, just 11.7 times earnings. The company also has a long-term growth rate of 14%, give it a PEG ratio of just 0.8.

The Chart

After testing resistance at $25 per share several times, POWL finally broke through on the earnings news. Shares are now trading above that level, which is now support. Take a look at the chart below.

Read the full analyst report on POWL