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Astec Industries: Backlog Is Strong, But The Margin Story Needs More Proof

Writer: Brigette Mwaura
Brigette Mwaura
Sep 19
7 min read

Updated: Sep 21

Summary

  • I am downgrading Astec from a BUY to HOLD. Astec Industries reported Q2 2026 sales of $408.1Mn, up 23.6%, and adjusted EBITDA of $42.6Mn, up 26.0%. Adjusted EPS of $0.94 missed the $1.04 consensus estimate.


  • The demand pillar strengthened as backlog rose 57.9% to $601.1Mn and parts and service revenue grew 34.8%. The earnings-conversion pillar weakened because Infrastructure margins compressed and management reduced 2026 adjusted EBITDA guidance.


  • My base case values 2027 adjusted EPS of $4.10 at 12.0x, producing a $49.20 future value and a $43.50 present target after a 10% discount rate.

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Source: Astec

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