Forgent Power Solutions Posts Breakout Quarter and Issues Ambitious FY27 Targets

Overview

• Forgent reported Wednesday that fourth-quarter revenue rose to $461.67 million and EPS was $0.25, a swing to quarterly net income of $66.09 million and full-year net income of $106 million.
• Management gave fiscal 2027 guidance that calls for $2.4–$2.6 billion in revenue and $1.26–$1.40 in EPS, a set of targets that assumes continued strong demand and large order conversion.
• The company began the year with a record backlog near $3 billion driven by a 53% sequential jump in new orders and initial direct purchase orders and master service agreements with Frontier AI Labs and multiple hyperscale cloud providers.
• Forgent announced a $35 million expansion of its Powertrain Solutions plant in Tijuana that management says will raise manufacturing capacity and is expected to come online in the fourth quarter of fiscal 2027.
• The market reacted with analyst price-target increases, heavy call-option buying and more institutional interest, but the stock trades at a P/E above 200 while net margin is about 2.17% so execution, margin improvement and timely capacity ramps are the immediate risks to watch.