Graham Corporation is growing revenue about 29% YoY and has beaten EPS estimates in 3 of the last 4 quarters, but heavy Navy and top-ten customer concentration, weak cash conversion and severely negative price momentum limit conviction.
Thesis pillars
- Strong Revenue Growth→Stable
- Consistent Earnings Beats↓Deteriorating
- Customer Concentration Risk↑Improving
- +2 more pillars — see the Why tab for full reasoning
Pillars as of Oct 24, 2026, based on the 10-K filed Jun 8, 2026
Graham Corporation (GHM) Stock Analysis
Industrials · Specialty Industrial Machinery
Sell if holding. Engine safety override at $71.16: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 5.2/10 and A.R:R 4.5:1 is above the 1.5:1 BUY gate. Specifically: Below-average business quality; Below long-term trend.
Graham Corporation designs and manufactures mission-critical fluid, heat transfer, vacuum, and advanced mixing equipment for the Defense, Energy & Process, and Space industries. Defense industry sales reached 60% of fiscal 2026 revenue, driven largely by U.S. Navy programs,... Read more
Sell if holding. Engine safety override at $71.16: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 5.2/10 and A.R:R 4.5:1 is above the 1.5:1 BUY gate. Specifically: Below-average business quality; Below long-term trend. Chart setup: No clear chart pattern; technical signals are mixed. Score 5.2/10, moderate confidence.
Passes 6/9 gates (positive momentum, favorable risk/reward ratio, clean insider activity, news events none recent, semi cycle peak clear, materials cycle peak clear). Fails on earnings proximity 6d<=7d. Suitability: speculative.
About Graham Corporation
About Graham Corporation
Graham Corporation ended fiscal 2026 (year ended March 31, 2026) with a $532.6 million backlog, up from $412.3 million a year earlier, as Defense industry sales grew to 60% of total revenue from 58% in fiscal 2025 and 54% in fiscal 2024. Domestic sales accounted for roughly 85% of fiscal 2026 revenue, reflecting the company's strategic push to expand support for U.S. Navy submarine, surface-ship, and torpedo programs alongside its Energy & Process and Space businesses.
Graham earns revenue by engineering and fabricating custom, order-specific equipment -- ejectors, surface condensers, turbopumps, and bladeless centrifugal mixers -- rather than selling standardized products, with a customer roster that includes General Dynamics, Newport News Shipbuilding, Northrop Grumman, L3Harris, Lockheed Martin, NASA, Blue Origin, and the U.S. Navy directly. Defense orders, chiefly for the Virginia-class and Columbia-class submarine programs and aircraft-carrier systems, typically run three to seven years from order to shipment and are funded through annual government appropriations, while Energy & Process revenue tracks the cyclical capital spending of refining and petrochemical customers. The company's top ten customers -- which vary year to year -- accounted for 60% of consolidated net sales in fiscal 2026, and two customers each individually exceeded 10% of revenue. Graham expanded into advanced mixing with the October 2025 acquisition of Xdot Bearing Technologies, folded into subsidiary Barber-Nichols, and the January 2026 acquisition of FlackTek, whose MEGA platform serves defense, battery, and industrial customers.
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Graham's growth strategy has concentrated its revenue behind a single government buyer: the 10-K states that while Defense sales are spread across multiple contractors and programs, the end customer -- primarily the U.S. Navy -- is the same, and that this could add risk if Navy program funding is disrupted. That exposure is compounded by the mechanics of federal budgeting, since Defense orders depend on annual appropriations and a government shutdown could delay Graham's ability to ship products or process export licenses; the company also flags that reduced federal spending, including actions by the Department of Government Efficiency, could shrink demand for its Navy-related equipment.
See also: Industrials · Specialty Industrial Machinery
From Graham Corporation's most recent 10-K filing, extracted July 6, 2026.
Recent developments
updated 2026-10-29Recent Developments — Graham Corporation
Latest news
- NEWS Watching Graham; Hearing Zacks Alternative Energy Newsletter Mentions Stock As A Buy — benzinga Oct 28, 2026 positive
- NEWS Oppenheimer Maintains Outperform on Graham, Lowers Price Target to $115 — benzinga Oct 8, 2026 positive
- NEWS JP Morgan Initiates Coverage On Graham with Overweight Rating, Announces Price Target of $120 — benzinga Oct 2, 2026 positive
- NEWS Graham Affirms FY2027 Sales Guidance of $285.000M-$295.000M vs $289.148M Est — benzinga Aug 6, 2026 neutral
- NEWS Graham Q1 Adj. EPS $0.49 Beats $0.36 Estimate, Sales $71.342M Beat $65.604M Estimate — benzinga Aug 6, 2026 positive
Generated 2026-10-29T11:48:39Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHCustomerDefense industry / U.S. Navy60%10-K Item 1A: 'sales to the Defense industry continued to grow and represented 60% of our business ... the end customer for these projects, primarily the U.S. Navy, is the same.'
- HIGHCustomertop ten customers60%10-K Item 1A: 'sales to our top ten customers, who can vary each year, accounted for 60%, 60%, and 57% of consolidated net sales in fiscal 2026, fiscal 2025, and fiscal 2024, respectively.'
- MEDIUMCustomertwo largest customers10-K Item 1A: 'we may have only two customers that each represent over 10% of revenue in any single year'
- HIGHGeographicdomestic (United States)85%10-K Item 1: 'Domestic sales accounted for approximately 85% of total sales in fiscal 2026, while sales to the Defense industry were 60%.'
Material Events(8-K, last 90d)
- 2026-06-17Item 5.02MEDIUMOn June 15, 2026, Daniel J. Thoren resigned as Executive Chairman and director, not due to any disagreement with the Company; he transitions to a Strategic Advisor role through June 15, 2027 under a retirement agreement paying a $150,000 annual base salary.SEC filing →
- 2026-06-05Item 5.02LOWOn June 1, 2026, the Compensation Committee renewed the Fiscal 2027 Annual Long-Term Incentive Award Plan, approving time-vesting RSU and performance-vesting PSU grants to named executive officers under the 2020 Equity Incentive Plan.SEC filing →
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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Rating Breakdown
1 floor-breaker
Quality below the gate floor. Component breakdown shows what dragged the score down.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. Engine safety override at $71.16: a dimension score below its floor triggers a hard block regardless of the otherwise-positive setup — overall score 5.2/10 and A.R:R 4.5:1 is above the 1.5:1 BUY gate. Specifically: Below-average business quality; Below long-term trend. Chart setup: No clear chart pattern; technical signals are mixed. Prior stop was $66.18. Score 5.2/10, moderate confidence.
Analyst target: $109.27 (+53.6% upside). Prior stop was $66.18. Stop-loss: $66.18.
Concentration risk — Customer: Defense industry / U.S. Navy (60.0%); Concentration risk — Customer: top ten customers (60.0%); Quality below floor (2.9 < 4.0).
Graham Corporation trades at a P/E of 69.1 (forward 31.3). TrendMatrix value score: 4.7/10. Verdict: Sell.
9 analysts cover GHM with a consensus score of 4.0/5. Average price target: $126.
What does Graham Corporation do?Graham Corporation designs and manufactures mission-critical fluid, heat transfer, vacuum, and advanced mixing...
Graham Corporation designs and manufactures mission-critical fluid, heat transfer, vacuum, and advanced mixing equipment for the Defense, Energy & Process, and Space industries. Defense industry sales reached 60% of fiscal 2026 revenue, driven largely by U.S. Navy programs, while domestic sales made up about 85% of the total; the company ended fiscal 2026 with a $532.6 million backlog, up from $412.3 million a year earlier.