What a time it’s been for AAON. In the past six months alone, the company’s stock price has increased by a massive 45.4%, reaching $123.44 per share. This was partly due to its solid quarterly results, and the performance may have investors wondering how to approach the situation.

Is it too late to buy AAON? Find out in our full research report, it’s free.

Why Are We Positive On AAON?

Backed by two million square feet of lab testing space, AAON (NASDAQ:AAON) makes heating, ventilation, and air conditioning equipment for different types of buildings.

1. Skyrocketing Revenue Shows Strong Momentum

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can have short-term success, but a top-tier one grows for years. Thankfully, AAON’s 21.4% annualized revenue growth over the last five years was incredible. Its growth surpassed the average industrials company and shows its offerings resonate with customers.

2. Operating Margin Reveals a Well-Run Organization

Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses–everything from the cost of goods sold to advertising and wages. It’s also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes.

AAON has been a well-oiled machine over the last five years. It demonstrated elite profitability for an industrials business, boasting an average operating margin of 17.9%.

3. Outstanding Long-Term EPS Growth

We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.

AAON’s EPS grew at an astounding 28.8% compounded annual growth rate over the last five years, higher than its 21.4% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

Final Judgment

These are just a few reasons why we're bullish on AAON, and with the recent surge, the stock trades at 45.2× forward price-to-earnings (or $123.44 per share). Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even More Than AAON

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