Thermon Group Holdings, Inc. (THR Quick QuoteTHR - Free Report) reported fourth-quarter fiscal 2025 adjusted earnings per share (EPS) of 56 cents, which surpassed the Zacks Consensus Estimate of 50 cents. The bottom line grew 64.7% year over year, driven by revenue growth, enhanced profitability and reduced interest expenses.
For the fiscal year ended March 31, 2025, adjusted EPS grew 2.8% year over year to $1.87.

Revenues in the quarter totaled $134.1 million, beating the Zacks Consensus Estimate by 0.4%. The top line expanded 5% year over year, driven by sustained strength in OPEX revenues, including strong performance from Vapor Power and contributions from F.A.T.I. This growth was partially offset by softness in large project revenues. Excluding contributions from F.A.T.I., organic revenues for the fourth quarter rose 3%.

For the full year, total revenues were $498.2 million, up 0.7% year over year. (See the Zacks Earnings Calendar to stay ahead of market-making news.)

Thermon reported a strong fiscal 2025, achieving record revenues and adjusted EBITDA, driven by successful integrations of the Vapor Power and F.A.T.I. acquisitions and continued execution of its strategic priorities. In fiscal 2025, revenues from Decarbonization and Electrification reached $63 million, marking 80% year-over-year growth, primarily led by contributions from Vapor Power. However, organic revenues within this segment contracted 19%, largely attributed to shifts in U.S. policy.

Thermon's opportunities pipeline was $435 million, up 70% year over year in fiscal 2025.

Despite macroeconomic uncertainties, Thermon sees positive demand trends in electrification, decarbonization, on-shoring and power markets. The company remains focused on its strategic pillars—Decarbonization, Digitization and Diversification—and is expanding into growth areas such as data centers and nuclear.

Other Details

Gross margin during the quarter expanded 330 basis points (bps) to 44.3% from 41% in the prior-year quarter. This was due to a more favorable revenue mix, improved pricing and productivity enhancements.

For fiscal 2025, the gross margin was 44.7% compared with 42.8% in fiscal 2024.

Adjusted EBITDA for the quarter increased 29% year over year to $30.5 million, driven by revenue growth, a more favorable mix, productivity gains and contributions from F.A.T.I., though partially offset by weakness in large projects.

For fiscal 2024, adjusted EBITDA increased 5% year over year to $109.2 million.

During the fourth quarter, it delivered bookings of $138.8 million, a 19% increase from $117 million in the same period last year. The book-to-bill ratio was 1.04.

For fiscal 2025, it delivered bookings of $536 million. The book-to-bill ratio was 1.08. 

Selling, general, and administrative expenses for the fourth quarter remained flat at $32.8 million year over year. This stability was driven by ongoing efficiency initiatives and effective cost management, which helped offset higher operating expenses related to the F.A.T.I. acquisition and continued investments in growth initiatives.

Cash Flow & Liquidity

As of March 31, 2025, the company had $39.5 million in cash and cash equivalents with $138.9 million of total debt compared with $48.6 million and $172.5 million, respectively, in the prior-year period.

For fiscal 2025, THR generated $63.1 million of cash from operating activities compared with $66 million in fiscal 2024.

Outlook

For fiscal 2026, revenues are projected in the range of $495-$535 million, implying year-over-year growth of 3.5% at the midpoint.

Adjusted EBITDA is expected to be in the band of $104-$114 million, flat at the midpoint.

Management anticipates GAAP EPS to be between $1.35 and $1.57 and adjusted EPS to be between $1.77 and $1.99.

Capital expenditure is estimated to be 2.5-3.0% of revenues.

Depreciation and amortization expenses are estimated to be $23 million.

Effective tax rate for fiscal 2026 is projected to be approximately 26%.

The company anticipates a slight decline in adjusted EBITDA margin, primarily due to the expected lag in the impact of its tariff mitigation efforts, which are likely to benefit results in the second half of the year.

THR’s Zacks Rank & Stock Price Performance

Thermon currently carries a Zacks Rank #3 (Hold). Shares of the company have declined 19.1% in the year compared with the Zacks Instruments - Control industry's fall of 2.2%. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Image Source: Zacks Investment Research

Performance of Other Firms in the Instruments Control Space 

Watts Water Technologies, Inc. (WTS Quick QuoteWTS - Free Report) reported first-quarter 2025 adjusted EPS of $2.37 compared with $2.33 in the prior-year quarter. The bottom line topped the Zacks Consensus Estimate by 11.8%. WTS’ quarterly net sales declined 2% year over year to $558 million. The top line surpassed the Zacks Consensus Estimate by 3.2%. Organic sales were down 2% year over year.

In the past year, shares of WTS have jumped 14.6%.

Badger Meter, Inc. (BMI Quick QuoteBMI - Free Report) reported earnings of $1.30 for the first quarter of 2025, which beat the Zacks Consensus Estimate by 20.4%. Also, the bottom line compared favorably with the year-ago quarter’s EPS of 99 cents. Quarterly net sales of BMI were $222.2 million, up 13% from $196.3 million in the year-ago quarter, driven by higher utility water sales and the initial contribution from the SmartCover acquisition. The Zacks Consensus Estimate was pegged at $222 million.

In the past year, shares of BMI have jumped 21.5%.

Sensata Technologies Holding plc (ST Quick QuoteST - Free Report) reported first-quarter 2025 adjusted EPS of 78 cents compared with 89 cents a year ago. However, the bottom line topped the Zacks Consensus Estimate by 8.3%. Revenues for the quarter reached $911.3 million, down 9.5% from a year ago. However, the figure outperformed management’s expectations ($870-$890 million) and beat the consensus estimate by 3.6%. 

In the past six months, shares of ST have decreased 24%.