Powell Industries, Inc.’s (POWL Quick QuotePOWL - Free Report) first-quarter fiscal 2025 (ended December 2024) adjusted earnings of $2.86 per share surpassed the Zacks Consensus Estimate of $2.83. The bottom line increased 44.3% year over year. Results benefited primarily from higher revenues generated in the quarter.

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Powell’s total revenues of $241.4 million missed the consensus estimate of $244 million. The top line increased 24.4% year over year. The year-over-year increase was primarily driven by strength across all sectors, including petrochemical, oil & gas and commercial & other industrial sectors.

Inside the Headlines for Powell Industries

In the fiscal first quarter, it generated revenues of $51.2 million from the electric utility sector, up 26% year over year. Revenues from the oil & gas sector amounted to $95.7 million, up 14% year over year. The commercial & other industrial sector’s revenues increased 80% to $44.3 million.

In the fiscal first quarter, new orders totaled $269 million compared with $198 million in the year-ago quarter. The increase was driven by robust order activity in the oil & gas and electric utility sectors. Exiting the quarter, its backlog totaled $1.3 billion, relatively flat on a sequential as well as year-over-year basis.

Margin Profile of POWL

In the fiscal first quarter, Powell’s cost of sales increased 24.8% year over year to $181.9 million. Gross profit increased 23.4% year over year to $59.5 million while the margin contracted 10 basis points (bps) to 24.7%. Selling, general and administrative expenses were $21.5 million, up 5.9% year over year.

Operating income increased 37.5% year over year to $35.6 million. The operating margin was 14.7%, up 130 bps year over year.

Powell’s Balance Sheet and Cash Flow

Exiting the first quarter of fiscal 2025, Powell had cash equivalents and short-term investments of $373.4 million compared with $358.4 million at the end of fiscal 2024 (ended September 2024). Current liabilities were $396.7 million compared with $428 million at the end of fiscal 2024.

Stockholders’ equity totaled $496.3 million. In the first three months of fiscal 2025, capital expenditure totaled $2.2 million, up 83.3% year over year.

In the same period, the company used $3.2 million for distributing dividends, relatively stable on a year-over-year basis.

Powell Fiscal 2025 Guidance

Powell expects to witness continued strength across most of the end markets across all geographies. Given the company’s robust backlog, solid liquidity and a strong balance sheet, it looks forward to witnessing strong revenues and earnings in fiscal 2025 (ending September 2025).

Zacks Rank & Stocks to Consider

POWL currently carries a Zacks Rank #4 (Sell). Here are some better-ranked stocks from the same industry:

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ENS delivered a trailing four-quarter average earnings surprise of 2.2%. In the past 60 days, the consensus estimate for Enersys’ fiscal 2025 (ending March 2025) earnings has increased 10.4%.

Zurn Elkay Water Solutions Corporation (ZWS Quick QuoteZWS - Free Report) presently carries a Zacks Rank #2 (Buy). ZWS delivered a trailing four-quarter average earnings surprise of 7.8%.

In the past 60 days, the consensus estimate for ZWS’ 2025 earnings has remained stable.

AZZ Inc. (AZZ Quick QuoteAZZ - Free Report) presently carries a Zacks Rank of 2. AZZ delivered a trailing four-quarter average earnings surprise of 15.2%.

In the past 60 days, the consensus estimate for AZZ’s fiscal 2024 (ending February 2025) earnings has increased 2.2%.