Engineered Components and Systems Stocks Q2 Highlights: Graham Corporation (NYSE:GHM)

Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at Graham Corporation (NYSE:GHM) and its peers.

Engineered components and systems companies possess technical know-how in sometimes narrow areas such as metal forming or intelligent robotics. Lately, automation and connected equipment collecting analyzable data have been trending, creating new demand. On the other hand, like the broader industrials sector, engineered components and systems companies are at the whim of economic cycles. Consumer spending and interest rates, for example, can greatly impact the industrial production that drives demand for these companies’ offerings.

The 13 engineered components and systems stocks we track reported a mixed Q2. As a group, revenues missed analysts’ consensus estimates by 0.9% while next quarter’s revenue guidance was 0.9% below.

Stocks--especially those trading at higher multiples--had a strong end of 2023, but this year has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts. Thankfully, engineered components and systems stocks have been resilient with share prices up 6.8% on average since the latest earnings results.

Graham Corporation (NYSE:GHM)

Founded when its founder patented a unique design for a vacuum system used in the sugar refining process, Graham (NYSE:GHM) provides vacuum and heat transfer equipment for the energy, petrochemical, refining, and chemical sectors.

Graham Corporation reported revenues of $49.95 million, up 5% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with an impressive beat of analysts’ earnings estimates but underwhelming EBITDA guidance for the full year.

“We are delivering consistent improvement, solid growth and strengthening profitability,” commented Daniel J. Thoren, President and Chief Executive Officer.

Graham Corporation delivered the weakest full-year guidance update of the whole group. Interestingly, the stock is up 9.6% since reporting and currently trades at $31.84.

Is now the time to buy Graham Corporation? Access our full analysis of the earnings results here, it’s free.

Best Q2: Arrow Electronics (NYSE:ARW)

Founded as a single retail store, Arrow Electronics (NYSE:ARW) provides electronic components and enterprise computing solutions to businesses globally.

Arrow Electronics reported revenues of $6.89 billion, down 19% year on year, outperforming analysts’ expectations by 5.7%. It was an exceptional quarter for the company with an impressive beat of analysts’ earnings estimates.

Arrow Electronics scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 9.3% since reporting. It currently trades at $135.08.

Is now the time to buy Arrow Electronics? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Worthington (NYSE:WOR)

Founded by a steel salesman, Worthington (NYSE:WOR) specializes in steel processing, pressure cylinders, and engineered cabs for commercial markets.

Worthington reported revenues of $318.8 million, down 13.6% year on year, falling short of analysts’ expectations by 9.6%. It was a weak quarter for the company with a miss of analysts’ earnings estimates.

Worthington had the weakest performance against analyst estimates in the group. As expected, the stock is down 8.6% since the results and currently trades at $45.80.

Read our full analysis of Worthington’s results here.

Park-Ohio (NASDAQ:PKOH)

Based in Cleveland, Park-Ohio (NASDAQ:PKOH) provides supply chain management services, capital equipment, and manufactured components.

Park-Ohio reported revenues of $432.6 million, up 1.1% year on year, falling short of analysts’ expectations by 2.9%. Taking a step back, it was a weak quarter for the company with some shareholders hoping for a better result.

The stock is up 15.2% since reporting and currently trades at $30.24.

Read our full, actionable report on Park-Ohio here, it’s free.

Timken (NYSE:TKR)

Established after the founder noticed the difficulty freight wagons had making sharp turns, Timken (NYSE:TKR) is a provider of industrial parts used across various sectors.

Timken reported revenues of $1.18 billion, down 7.1% year on year, in line with analysts’ expectations. Overall, it was a mixed quarter for the company with a decent beat of analysts’ organic revenue estimates.

The stock is down 1.2% since reporting and currently trades at $84.53.

Read our full, actionable report on Timken here, it’s free.

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