GHM - Graham Corporation: After A Fantastic Ride Higher It's Time To Step Back (Rating Downgrade)

2024-05-18 13:00:00 ET

Summary

• Graham Corporation has seen a surge in its stock price, outperforming the S&P 500 significantly since late last year.
• The company has shown continued revenue growth, improving cash flows, and backlog expansion, indicating future revenue growth.
• Despite optimism about the company's long-term prospects, the recent surge in stock price warrants a downgrade to a 'hold' rating.

Late last year, near the end of December, I conducted my first ever deep dive into Graham Corporation ( GHM ), a company that's focused on the production of mission critical fluid, power, and heat transfer, as well as vacuum technologies. In that article, I mentioned how impressed I was with the firm's growth leading up to that point. It looked as though the company was well on track to achieve the $200 million in annual revenue that it was targeting by 2027. Add on top of this how shares were trading from a valuation perspective, and I could not help but to rate it a ’buy’....

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