Esco Technologies Inc Dossier - Source-backed chat

Esco Technologies Inc

ESENYSE

SectorInformation Technology

IndustryScientific & Technical Instruments

Beta (adjusted)1.08

Intrinsic Value $371.15median of 6 methods · middle span $160-$738based on filings through 30 Jun 2026

Market Price $269.92Price as of 1 Oct 2026

UndervaluedIntrinsic value is 38% above the market price

−50% · IV below pricenear fair value ±15%IV above price · +50%

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Market Cap $7B

Enterprise Value $7B

Shares Outstanding 26M diluted

Moat Rating None

Next Earnings Date19 Nov 2026

Last ex-dividend1 Oct 2026

All prices and values are periodic snapshots, not live quotes. Source dates are shown for reference.

Thesis

Street consensus, scenarios, merits, risks, and invalidation triggers

AI-assisted

Thesis Summary

ESCO entered the final quarter of fiscal 2026 with broad-based organic growth, expanding adjusted profitability, a record $1.54 billion backlog and management's second guidance increase of the fiscal year. Aerospace and defense, utility diagnostics and RF test markets provide durable demand, while the pending Megger acquisition could materially expand the Utility Solutions platform. The principal offsets are Megger closing, financing and integration risk, equity dilution, and pronounced weakness at NRG after U.S. renewable-energy tax credits expired.

This section is the 12-month view: analyst targets and the probability-weighted scenarios built from them. The intrinsic value at the top of this page answers a different question: what the business is worth today.

Street view · analyst 12-month targets4 analysts · as of 18 Aug 2026

Low · most bearish analyst$345.00

Mean target$390.75

High · most bullish analyst$420.00

Our research · scenarios, merits, risks, and invalidation triggersResearch as of 2 Sep 2026

Scenarios · 12-month scenario targetsAnchored at research date

Bear CaseDownside scenario

$345.0023%

Megger closing or integration is delayed, debt and dilution weigh on per-share value, NRG weakness persists, and backlog conversion slows as government funding, supply-chain or customer timing pressures emerge. Underperformance against fiscal 2026 guidance would further weaken confidence in execution.

Base CaseCentral scenario

$390.7558%

Matches the consensus mean

ESCO delivers fiscal 2026 adjusted EPS within its $8.30-$8.40 guidance range, maintains positive book-to-bill performance and closes Megger near the stated fiscal Q1 2027 timetable.

Bull CaseUpside scenario

$420.0019%

Backlog converts without material delays, aerospace and Navy demand remains strong, data-center filter and shielding orders sustain Test growth, and Megger closes during fiscal Q1 2027 with a credible integration path. Continued operating leverage and stronger-than-guided organic growth support a premium outcome.

Scenarios are anchored to street consensus at the research date, with our probabilities and rationale.

Key Investment Merits

Record consolidated backlog of $1.54 billion and a Q3 FY2026 book-to-bill ratio of 1.21 provide substantial forward demand visibility.
Q3 FY2026 organic sales increased 8%, adjusted EBIT margin expanded by 90 basis points and adjusted EPS increased 38%.
Management raised fiscal 2026 adjusted EPS guidance to $8.30-$8.40 and narrowed sales guidance upward to $1.30-$1.33 billion.
Aerospace and Defense, Doble utility diagnostics, and Test data-center applications each contributed identifiable order or revenue momentum.
The pending Megger acquisition could create a utility-test platform of substantially greater scale and expand ESCO's capabilities with global power-infrastructure customers.

Key Investment Risks

Megger introduces material regulatory, financing, equity-dilution and post-closing integration risk.
NRG revenue declined 29% in Q3 FY2026 following expiration of U.S. renewable-energy tax credits.
A significant portion of backlog is concentrated in Aerospace and Defense, exposing conversion timing to government appropriations, contract awards and program schedules.
Inflation, unfavorable product mix, supply-chain disruption and acquisition-related costs could limit margin conversion despite revenue growth.

All scenarios are estimates and subject to change. Past performance is not indicative of future results.

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Explore this dossier

ValuationIntrinsic value, the six-method breakdown, peer medians, and your assumptions sandbox.Financial SnapshotRevenue, profitability, returns, balance sheet, dividends, and the filing-level detail.Qualitative AnalysisBusiness overview, strategic initiatives, and mergers, acquisitions & partnerships.Outlook & Key DatesForward estimates, reporting calendar, and the monitoring framework.