Argan: The Stock That Could Fuel America's AI

Summary

• Argan is poised to benefit from surging US energy demand, with a record $1.86B backlog and strong margin expansion driven by AI, data centers, and EV growth.
• The company’s robust balance sheet, net cash position, and high-quality, incentive-backed project pipeline support a Buy rating and a $238 target price (+13% upside).
• Key risks include customer concentration, commodity inflation, and regulatory delays, but conservative management and project visibility help mitigate these concerns.
• I recommend a 3-5% portfolio allocation, with active monitoring of margins, backlog evolution, regulatory updates, and project execution to capture upside while managing risk.

Jonathan Kitchen

Argan, Inc. (NYSE:AGX) is well-positioned to benefit from the surge in energy demand driven by AI, data centers and electric vehicles, while a large share of US thermal power plants built in the post-World War II era (1950s-1970s) are rapidly

Analyst’s Disclosure:I/we have a beneficial long position in the shares of AGX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.