Espey Mfg. & Electronics Corp (ESP)
AMEXIndustrialsElectrical Equipment & PartsSnapshot 2026-09-04
$63.35+1.26%
Close 2026-09-04 · 1-day change
AMEXIndustrialsElectrical Equipment & PartsSnapshot 2026-09-04
Intact: The reason to own it still holds.
Espey Mfg. grows revenue about 25% next year. Profit margins stay stable with a PE near 16, well below peers at 40. The company pays a steady dividend and has stable management. Free cash flow yield is positive, supporting financial health.
The recent 7-day selloff shows investor concern. Revenue growth or earnings could disappoint given fragile quality. The legal and auditor changes add uncertainty. The sector faces headwinds that may pressure margins and demand.
The price is about 19% below our fair value near $78. Analysts expect 25% revenue growth next year, which is reflected in the price. Our view aligns with this but we see risk from sector headwinds and recent volatility.
Breaks if: dividend yield falls below 2% or dividend is cut
Breaks if: free cash flow yield falls below 1%
Breaks if: profit margins decline causing PE to rise above 20 without growth
Breaks if: revenue growth falls below 15% YoY in FY27
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a durable compounder with a stable management team and recent strong financial performance. The current thesis state is intact, supported by a medium confidence level and a favorable recent price reaction.
The market appears to have priced in a cheap valuation compared to peers, with an expectations gap indicating that investors may not fully anticipate future performance. The current valuation is justified, suggesting that there is room for growth if fundamentals improve.
Fundamentals are expected to remain stable, given the recent strong financial performance. However, there is an elevated risk due to the company's smaller size and the high miss rate in its industry, which could impact future results.
The long-term thesis hinges on the performance of sector bellwethers like ETN, VRT, and BE, which could influence ESP's momentum. Additionally, the trajectory of inflation and its impact on Federal Reserve rate cuts will be crucial for the company's outlook.
Over the next 1 to 3 years, ESP's performance will depend on external sector dynamics and inflation trends. Not investment advice.
The most important moves since the prior daily snapshot.
Our read on the company is unchanged since the prior snapshot.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.