Research Idea
Research content for general circulation. Not individualized advice. Methodology & Disclosures
Q2 sales grew 101.2% year over year, 2026 sales-growth guidance rose to 55%–60%, and shares closed above their prior 20-session high on September 25. Data-center cooling demand supports the outlook.
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AI Analyst Overview
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Valuation Metrics
Fundamental Analysis
Key Financial Insights: • Strong Liquidity • Negative Free Cash Flow • Rising Working Capital AAON offers strong liquidity and solid profitability, but weak free-cash-flow conversion, rising working-capital needs, limited cash reserves, and an elevated valuation warrant caution.
Price Behavior
Key Price Behavior Insights: • Downtrend persists • Support holding • $81 breakout Support Level: $74.00–$75.00 Resistance Level: $79.50–$81.00 AAON remains technically weak over the last month, but holding $74–$75 support and breaking above $81 would signal improving momentum.
Sentiment & News
Key News Insights: • BASX demand • $2B backlog • Margin headwinds AAON's data-center-driven growth and $2B backlog signal strong expansion potential, but margin pressure, negative cash flow, and share weakness remain key risks.
AI Summary
AAON is now a data-center cooling manufacturing-ramp story, not a traditional HVAC growth play: its near-$2B backlog and 55%–60% 2026 growth outlook can justify upside only if Memphis utilization restores margins and converts working-capital-heavy growth into positive free cash flow by 2027. At still-demanding valuation multiples, investors should wait for tangible evidence of margin recovery and cash conversion, as execution delays or a hyperscale demand slowdown could sharply pressure returns.
Description
AAON, Inc. engineers, manufactures and sells heating, ventilation and air conditioning equipment across the United States and Canada through its AAON Oklahoma, AAON Coil Products and BasX segments. Its product range includes packaged and modular systems, chillers, coils and controls designed for commercial, institutional and industrial settings such as retail, manufacturing, education, lodging, supermarkets, data centers and healthcare. The company distributes via independent representative firms and an internal sales organization and is headquartered in Tulsa, Oklahoma, having been incorporated in 1987.
Idea History
| Date | Close | Ticker | Company | Summary | Status | P/L |
|---|---|---|---|---|---|---|
| Sep 25 | Oct 2 | AAON | AAON, Inc. | Q2 sales grew 101.2% year over year, 2026 sales-growth guidance rose to 55%–60%, and shares closed above their prior 20-session high on September 25. Data-center cooling demand supports the outlook. | Active | +0.0% |
| May 15 | May 22 | AAON | AAON, Inc. | Q1 2026 was a major upside catalyst: sales rose 54.3% to a record $496.9M, backlog reached a record $2.1B, and 2026 revenue guidance was raised to 40%-45%. Data-center demand and higher throughput support visibility, with the stock up about 44% over 21 trading days. | Closed | -0.7% |
| May 8 | May 15 | AAON | AAON, Inc. | Major Q1 2026 beat and guidance reset: record net sales rose 54.3% YoY to $496.9M, EPS rose 37.1% to $0.48, backlog hit a record $2.1B, and 2026 revenue growth guidance was raised to 40%-45%. Data-center demand and a 49% 21-day stock gain support near-term strength. | Closed | -3.0% |