Argan, Inc. AGX is gradually building exposure to the data center market through its Teledata segment, which could support revenue growth. The segment aligns with rising demand for digital infrastructure, especially as data centers require reliable power and advanced network connectivity. This positioning complements the company’s broader capabilities in power and infrastructure development.
Teledata provides project management and construction services across power distribution, communication networks and data infrastructure for commercial and industrial customers. The segment also supports federal and military locations that require high security clearance, along with data center-related work. This diversified exposure allows the company to participate in multiple layers of infrastructure tied to data center expansion.
In the fourth quarter of fiscal 2026, Teledata revenues were $5 million compared with $3 million in the year-ago quarter, contributing 2% of consolidated revenues. The segment ended fiscal 2026 with a backlog of $8.4 million, indicating early-stage growth but still a small contribution to the overall business.
The company also added a $125 million project in the Industrial segment linked to the data center market, highlighting broader participation beyond Teledata. Rising electrification, growth in AI and increasing data center demand are putting pressure on aging power infrastructure. This creates a need for reliable 24/7 energy, where the company’s expertise in building complex power facilities becomes relevant.
While Teledata is still a small part of the business, improving demand trends and support from other segments indicate it can contribute to overall revenues over time.
Argan’s Competitive Landscape
Argan’s positioning in data center-linked infrastructure reflects broader industry momentum, where peers such as Jacobs Solutions Inc. J and EMCOR Group, Inc. EME are also benefiting from rising demand tied to electrification, digital infrastructure and reliable power generation. These companies operate across engineering, construction and mission-critical infrastructure, creating direct overlap in end markets like data centers and energy systems.
Jacobs Solutions remains a key competitor with strong exposure to advanced facilities, including data centers and high-tech infrastructure. The company focuses on consulting, design and program management, allowing it to capture early-stage project opportunities. Similar to Argan’s expanding role in power and infrastructure, Jacobs Solutions benefits from long-term demand driven by digitalization and grid modernization.
EMCOR Group has a strong presence in electrical and mechanical construction, with significant exposure to data centers and other mission-critical facilities. Data centers form an important growth area, supported by demand for power reliability and network systems. Compared with Argan, EMCOR Group has a more diversified end-market mix, but both companies are aligned with the growing need for energy-intensive digital infrastructure.
AGX Stock’s Price Performance & Valuation Trend
Shares of this global provider of consulting services of engineering, procurement and construction have surged 113.6% in the past six months, outperforming the Zacks Building Products - Miscellaneous industry, the broader Construction sector and the S&P 500 index.
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AGX stock is currently trading at a premium compared with the industry, with a forward 12-month price-to-earnings (P/E) ratio of 47.05, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of AGX
AGX’s earnings estimates for fiscal 2027 and 2028 have trended upward in the past 30 days. The revised estimates for fiscal 2027 and 2028 imply year-over-year growth of 17.5% and 39.5%, respectively.
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Argan currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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