POWL · Technology(switchgear & switchboard apparatus) · 10 years of annual accounts filed with the SEC · latest fiscal year ended 2025-09-30
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Powell Industries Inc reported revenue of $1.1 billion in fiscal 2025, after growing 7.7% a year over the previous 9 years. Its operating margin widened from 2.8% in 2016 to 19.7%. Of the $649.4 million its operations generated over 10 years, 18.8% went to dividends and 9.1% back into the business; the share count rose 6.4%. On the accounting screens, it passes 6 of 8 Piotroski tests, its Altman Z'' of 7.48 is in the safe zone and its Beneish M-score is below the -1.78 line; none of the six cross-checks between its statements fires.
Revenue, fiscal 20251.1B+7.7% a year over 9 years
Operating margin19.7%gross margin 29.4%
Return on invested capital—0.8% on average over 2 years
Free cash flow after stock pay150.2M13.6% of revenue
Net debt ÷ EBITDA—net debt —
Piotroski F-score6/8tests of improvement passed
Is it growing?
Revenue and the operating income it turns into. Growth that does not reach operating income is growth bought with margin.
RevenueOperating income
-500.0M0500.0M1.0B1.5B
2016Revenue 565.2MOperating income 15.8M
2017Revenue 395.9MOperating income -19.3M
2018Revenue 448.7MOperating income -9.1M
2019Revenue 517.2MOperating income 11.5M
2020Revenue 518.5MOperating income 19.1M
2021Revenue 470.6MOperating income 1.0M
2022Revenue 532.6MOperating income 7.2M
2023Revenue 699.3MOperating income 62.5M
2024Revenue 1.0BOperating income 178.8M
2025Revenue 1.1BOperating income 217.9M
2016201720182019202020212022202320242025
Compound growth a year
3 yrs
5 yrs
9 yrs
Revenue
+27.5%
+16.3%
+7.7%
Operating income
+211.3%
+62.8%
+33.9%
Net income
+136.1%
+61.1%
+31.4%
Earnings per share
+134.6%
+59.8%
+30.5%
Free cash flow per share
—
+17.2%
+8.1%
Dividend per share
+1.1%
+0.5%
+0.2%
Shares
+0.6%
+0.8%
+0.7%
Falling shares are buybacks: each remaining share owns more of the company.
Does it earn more than its capital costs?
Margins say how much of each sale is kept; return on invested capital says how much the business earns on the money it needs to operate. Growth only creates value when that return is above the cost of the capital.
Return on invested capitalCost of capital today · 10.2%
-10.0%-5.0%0.0%5.0%10.0%15.0%
2016Return on invested capital 4.1%
2017Return on invested capital -8.6%
2018Return on invested capital -3.2%
2019Return on invested capital 3.1%
2020Return on invested capital 5.1%
2021Return on invested capital 0.2%
2022Return on invested capital 1.5%
2023
2024
2025
2016201720182019202020212022202320242025
Economic profit
Economic profit
-80.0M-60.0M-40.0M-20.0M0
2016Economic profit -20.6M
2017Economic profit -60.7M
2018Economic profit -40.6M
2019Economic profit -21.4M
2020Economic profit -15.6M
2021Economic profit -30.1M
2022Economic profit -25.9M
2023
2024
2025
2016201720182019202020212022202320242025
(return on capital − cost of capital) × capital invested: the profit left after paying for the money used. Today's cost of capital is applied to every year, since a past one cannot be rebuilt honestly.
Return on equity
28.2%
Return on assets
16.3%
Asset turnover
1.00×
Research & development
1.0% of revenue
Overheads (SG&A)
8.6% of revenue
Is the profit cash, and where does the cash go?
Net income is an accounting opinion; free cash flow is what was left in the bank after investing. Stock-based pay does not leave the bank — shareholders pay it through dilution — so it is shown taken off as well.
Net incomeFree cash flowAfter stock-based pay
-100.0M0100.0M200.0M
2016Net income 15.5MFree cash flow 71.9MAfter stock-based pay 67.0M
2017Net income -9.5MFree cash flow 33.2MAfter stock-based pay 30.5M
2018Net income -7.2MFree cash flow -33.0MAfter stock-based pay -36.1M
2019Net income 9.9MFree cash flow 64.5MAfter stock-based pay 60.7M
2020Net income 16.7MFree cash flow 67.2MAfter stock-based pay 63.8M
2021Net income 631,000Free cash flow -33.4MAfter stock-based pay -36.0M
2022Net income 13.7MFree cash flow -6.0MAfter stock-based pay -10.1M
2023Net income 54.5MFree cash flow 174.7MAfter stock-based pay 170.1M
2024Net income 149.8MFree cash flow 96.7MAfter stock-based pay 91.9M
2025Net income 180.7MFree cash flow 154.8MAfter stock-based pay 150.2M
2016201720182019202020212022202320242025
Where 10 years of operating cash went, 2016–2025
649.4M generated by the business. Each band is its share of that total.
Reinvested in the business 9%58.8M
Acquisitions 2%11.5M
Dividends 19%122.0M
Share buybacks 1%3.7M
Kept, or used to pay down debt 70%453.4M
Over the same years it paid 38.7M in stock. The share count rose 6.4%. The buybacks did not even cover what was handed out in stock.
Per share
Earnings per shareFree cash flow per shareDividend per share
$-5.00$0.00$5.00$10.00$15.00
2016Earnings per share $1.36Free cash flow per share $6.29Dividend per share $1.04
2017Earnings per share $-0.83Free cash flow per share $2.90Dividend per share $1.04
2018Earnings per share $-0.62Free cash flow per share $-2.86Dividend per share $1.04
2019Earnings per share $0.85Free cash flow per share $5.54Dividend per share $1.03
2020Earnings per share $1.42Free cash flow per share $5.75Dividend per share $1.03
2021Earnings per share $0.05Free cash flow per share $-2.83Dividend per share $1.03
2022Earnings per share $1.15Free cash flow per share $-0.51Dividend per share $1.02
2023Earnings per share $4.50Free cash flow per share $14.42Dividend per share $1.02
2024Earnings per share $12.29Free cash flow per share $7.93Dividend per share $1.04
2025Earnings per share $14.86Free cash flow per share $12.72Dividend per share $1.06
2016201720182019202020212022202320242025
Shares outstanding
Diluted shares
11.4M11.6M11.8M12.0M12.2M
2016Diluted shares 11.4M
2017Diluted shares 11.5M
2018Diluted shares 11.5M
2019Diluted shares 11.6M
2020Diluted shares 11.7M
2021Diluted shares 11.8M
2022Diluted shares 11.9M
2023Diluted shares 12.1M
2024Diluted shares 12.2M
2025Diluted shares 12.2M
2016201720182019202020212022202320242025
How strong is the balance sheet?
Debt is not bad in itself; debt the business cannot service in a bad year is. Net debt is debt minus cash, and below zero the company holds more cash than it owes.
Net debt
-200.0M-150.0M-100.0M-50.0M0
2016Net debt -95.3M
2017Net debt -66.4M
2018Net debt -35.0M
2019Net debt -117.4M
2020Net debt -159.4M
2021Net debt -113.9M
2022Net debt -102.0M
2023
2024
2025
2016201720182019202020212022202320242025
Net debt ÷ EBITDA
—
Interest coverage
— operating income ÷ interest
Current ratio
2.09 current assets ÷ current liabilities
Cash conversion cycle
80 days collects in 72d, stock 40d, pays in 31d
Three classic screens of the accounts
Each asks a different question of the same statements — is it improving, does it look like a company heading for distress, do the accounts resemble ones that were manipulated. None is a verdict; each shows what moves it.
Piotroski F-score
Is the business improving? Nine yes-or-no tests, this year against last.
6of 8 tests passed
✓ProfitableReturn on assets above zeropassed
✓Cash from operationsOperating cash flow above zeropassed
✓Profitability improvedReturn on assets higher than a year beforepassed
✕Profit backed by cashOperating cash flow above net income (low accruals)failed
–Less long-term debtLong-term debt as a share of assets fell — not reportedno data
✓More liquidCurrent ratio higher than a year beforepassed
✓No new sharesShare count did not growpassed
✓Better gross marginGross margin higher than a year beforepassed
✕Sells more per assetAsset turnover higher than a year beforefailed
Where it misleads: it measures change, not level. An excellent business that stood still for a year scores low; a poor one recovering from a disaster scores high.
Altman Z''-score
Does the balance sheet look like those of companies that went bankrupt?
7.48safe zone
1.12.6
Working capital ÷ assets 0.44 × 6.56+2.87
Retained earnings ÷ assets 0.57 × 3.26+1.85
Operating income ÷ assets 0.20 × 6.72+1.32
Equity ÷ liabilities 1.37 × 1.05+1.44
Where it misleads: buybacks. A company that returns so much cash that its equity turns small or negative sinks the last two ratios without being anywhere near bankruptcy. Banks and insurers do not fit the model at all.
Beneish M-score
Do the accounts resemble those of companies that manipulated their earnings?
-2.36below the -1.78 line
-1.78
Receivables vs sales 0.93+0.85
Gross margin slipping 0.92+0.48
Soft assets 1.15+0.46
Sales growth 1.09+0.97
Slower depreciation 1.01+0.12
Overheads vs sales 1.03-0.18
Profit not in cash 0.01+0.05
Leverage rising 0.87-0.29
Where it misleads: fast growth and acquisitions. Sales growth carries a heavy weight, so a company growing 50% a year scores like a suspect without having done anything. It is a screen from a 1999 study, not an accusation.
Where the statements disagree
Cross-checks between the income statement, the balance sheet and the cash flow for the latest year, each with the benign reading and the worrying one.
None of the six cross-checks fires for the latest year: receivables and inventory move with revenue, profit turns into cash, investment keeps up with depreciation, the tax rate is ordinary and debt is moderate.
What is it worth, under which assumptions?
A company is worth the cash it will generate, brought back to today. This model projects revenue with growth that fades over the years, applies a free cash flow margin, and discounts the result at the cost of capital. Every assumption says where it came from, and all of them can be changed.
Value per share, with these assumptions$141.93discounted at 10.2% a year · 53% of it from after year 10
Type a share price on the left to ask the reverse questions: what growth, what margin or what discount rate that price implies.
What the value implies, in the usual multiples
At this model's value
Price ÷ earnings
9.6×
Enterprise value ÷ EBITDA
7.7×
Enterprise value ÷ revenue
1.6×
Free cash flow yield
8.7%
From cash flows to a value per share
10 years of cash flow, today803.4M
Everything after, today923.5M
The whole business1.7B
Minus net debt-0
What belongs to shareholders1.7B
Divided among 12.2M shares: <strong>$141.93</strong> each.
The projection next to its history
Reported free cash flow after stock pay, then the model's. A projection that looks nothing like the past needs a reason.
ReportedProjected
-100.0M0100.0M200.0M
2016Reported 67.0M
2017Reported 30.5M
2018Reported -36.1M
2019Reported 60.7M
2020Reported 63.8M
2021Reported -36.0M
2022Reported -10.1M
2023Reported 170.1M
2024Reported 91.9M
2025Reported 150.2M
2026Projected 86.3M
2027Projected 99.2M
2028Projected 112.5M
2029Projected 125.8M
2030Projected 138.7M
2031Projected 150.8M
2032Projected 161.6M
2033Projected 170.7M
2034Projected 177.6M
2035Projected 182.0M
2016201820202022202420262028203020322034
Year by year
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
Revenue
1.3B
1.5B
1.7B
1.9B
2.1B
2.2B
2.4B
2.5B
2.6B
2.7B
Growth
16.5%
14.9%
13.4%
11.8%
10.3%
8.7%
7.2%
5.6%
4.1%
2.5%
Cash margin
6.7%
6.7%
6.7%
6.7%
6.7%
6.7%
6.7%
6.7%
6.7%
6.7%
Free cash flow
86.3M
99.2M
112.5M
125.8M
138.7M
150.8M
161.6M
170.7M
177.6M
182.0M
Worth today
78.3M
81.7M
84.1M
85.4M
85.5M
84.3M
82.0M
78.6M
74.3M
69.1M
If the least-known inputs move
Value per share as two inputs change at a time. Neighbouring cells that differ a lot are the conclusion: the value depends on numbers nobody knows to a point.
The discount rate and growth forever
discount ↓ · forever →
1.5%
2.0%
2.5%
3.0%
3.5%
9.2%
147
155
165
176
190
9.7%
137
144
153
162
173
10.2%
128
135
142
150
159
10.7%
121
126
133
140
148
11.2%
114
119
124
130
137
Year-one growth and the final margin
margin ↓ · growth →
12.5%
14.5%
16.5%
18.5%
20.5%
5.4%
103
111
120
129
139
6.0%
112
121
131
141
152
6.7%
121
131
142
153
166
7.4%
131
142
153
166
179
8.1%
140
152
164
178
192
All the inputs moving at once
5,000 valuations, each with growth, final margin, discount rate and growth forever drawn at random around the values on the left (spreads of 3.0%, 2.0%, 1.0% and 0.5%). Not a probability — the spreads are assumptions too — but an honest picture of how wide the answer is.
10th percentile$93.95
Median$141.77
90th percentile$205.92
$100.00$200.00
Half of the simulations land between <b>$115.55</b> and <b>$172.62</b>; one in ten below $93.95, one in ten above $205.92.
Does the long run make sense?
4.4×The terminal value prices the business in year 10 at 4.4 times that year's EBITDA.
4%To grow 2.5% forever while reinvesting 56% of its after-tax operating profit, the business must earn 4% on the new capital — it has earned 1% on average over the last five years.
53%of the value comes from after year 10. The more of it, the more the answer depends on the part nobody can see.
What lenders charge, after the tax saving on interest: 6.67% × (1 − 22.6%) = <strong>5.16%</strong>.
Weighted by how much of each the company uses (book value (no price given)): <strong>10.17%</strong>, the rate every future cash flow is discounted at.
What it has filed lately
The last twelve months at the SEC, most important first: annual and quarterly reports, events, large holders and insiders.
Every Form 4 filed in the last twelve months, read line by line: 6 filings by 4 people. Open-market purchases and sales are counted apart from awards, option exercises and shares withheld for taxes.
Bought on the open market—none in the period
Sold on the open market$3.7M12 sale(s) by 3 insider(s)
Under pre-arranged plans92%of the sales followed a 10b5-1 plan set months earlier
A Form 4 says what happened, when, how many shares and at what price. It does not say why: a sale can be diversification, a tax bill or a plan fixed months earlier, and an award is pay, not a purchase. Nothing here is a reason to buy or sell anything.
Which large funds report holding it
From the Form 13F of the 28 institutions followed on this site, as of the end of their last reported quarter. A 13F is filed up to 45 days later and shows only long positions in US-listed shares.
Accounts from the company's own SEC filings; lines some companies do not report are shown as a dash rather than estimated. The risk-free rate is the 10-year US Treasury yield. A DCF is a way of making assumptions explicit, not a forecast: it states what the company would be worth if the assumptions held. The scores are screens that point where to look, not verdicts. Nothing here is a recommendation to buy or sell.
