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The underperformance in stock price led FPS to trade at a P/S multiple of 2.27x, lower than the industry P/S multiple of 3.15x.
FPS Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research
Given these dynamics, investors are wondering if it’s the right time to buy, sell or hold the stock. Let’s dive into the fundamentals and financials of the stock and discuss what investors should do with FPS right now.
Electrical Infrastructure Demand Is Supporting FPS’ Expansion
Forgent Power Solutions designs and manufactures electrical distribution equipment used in data centers, the power grid and energy-intensive industrial facilities. Its portfolio includes transformers, switchgear, panelboards, automatic transfer switches, power distribution units, generator connection cabinets and prefabricated electrical houses and power skids. Demand across these end markets supported an 89% increase in fiscal 2026 revenues to $1.42 billion compared with $753.2 million in fiscal 2025.
FPS’ data centers accounted for approximately 59% of revenue, Grid contributed 21%, Industrial 10% and other markets 10%. Data centers remain its largest end market. FPS’ offering is organized into Custom Products, Powertrain Solutions and Standard Products. FPS’ custom products are engineered for individual projects. Powertrain Solutions combine custom products into integrated systems, while Standard Products use common designs for basic applications.
In fiscal 2026, these categories contributed approximately 70%, 25% and 3% of revenue, respectively; services accounted for the remaining 2%. The company’s engineering-led approach is intended to address requirements involving power availability, uptime, equipment integration, thermal management and installation constraints. Its annual report describes early collaboration with customers to define system requirements and assess cost, performance and availability trade-offs. FPS’ design tools and reference designs support rapid customization, making them ideal for rapid data center and grid building.
Record Orders and Backlog Improve Revenue Visibility for FPS
FPS’ commercial activity accelerated in the fourth quarter of fiscal 2026. The company’s revenues reached $462 million, which increased 94% year over year, and bookings were $1.5 billion, which rose 375%. FPS’ book-to-bill ratio was 3.3 times. On June 30, 2026, backlog stood at approximately $3 billion, 256% above the prior-year level. The company stated that backlog covered more than 90% of its fiscal 2027 revenue guidance. However, FPS competes with Vertiv ((VRT - Free Report) ), Hubbell Inc. ((HUBB - Free Report) ) and Eaton Corporation plc ((ETN - Free Report) ). Vertiv is a leading provider of critical digital infrastructure and continuity solutions for data centers, communication networks and industrial facilities
Vertiv's portfolio includes power management, UPS systems, thermal management, cooling infrastructure and integrated data center solutions. Hubbell overlaps with Forgent in electrical components and power infrastructure, although its business has broader exposure to utility and grid modernization markets. Eaton competes with Forgent across several electrical infrastructure categories and benefits from rising investments in grid modernization and data center capacity.
However, FPS has its niche. FPS’ powertrain solutions are becoming more meaningful as revenues from this category increased 259% in fiscal 2026 and represented about one-quarter of annual revenue. FPS announced an additional $35 million investment at its Tijuana campus to increase Powertrain Solutions capacity by more than 50%. The expansion is expected to come online in the fourth quarter of fiscal 2027 and raise total revenue capacity to approximately $5.8 billion.
FPS’ first-quarter revenues are expected to be between $445 million and $465 million, and adjusted EBITDA to be $90 million to $100 million. For fiscal 2027, FPS expects revenues of $2.4 billion to $2.6 billion, adjusted EBITDA of $575 million to $625 million and adjusted EPS of $1.26 to $1.40. The Zacks Consensus Estimate for fiscal 2027 revenues and earnings is pegged at $2.6 billion and $1.34, respectively, indicating year-over-year growth of 79%.
Image Source: Zacks Investment Research
Conclusion: Buy FPS Stock Now
FPS’ strong revenue growth, record backlog, expanding Powertrain Solutions business and optimistic fiscal 2027 guidance support its long-term growth prospects. Moreover, its current P/S multiple below the industry average may offer an attractive entry point. However, investors should consider execution risks associated with capacity expansion, rising costs and dependence on data center demand. Given its growth outlook and valuation discount, investors may consider accumulating FPS gradually while monitoring quarterly execution and profitability. FPS sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
View the Zacks #1 Rank List
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FPS Declines 42% in a Month: Time to Buy the Stock Now?
Key Takeaways
Forgent Power Solution (FPS - Free Report) shares have plunged 42.1% in the past month, underperforming the Zacks Electronics - Miscellaneous Components industry and the Zacks Computer and Technology sector’s decline of 11.6% and 12.6%, respectively.
FPS One-Month Performance Chart
Image Source: Zacks Investment Research
The underperformance in stock price led FPS to trade at a P/S multiple of 2.27x, lower than the industry P/S multiple of 3.15x.
FPS Forward 12-Month (P/S) Valuation Chart
Image Source: Zacks Investment Research
Given these dynamics, investors are wondering if it’s the right time to buy, sell or hold the stock. Let’s dive into the fundamentals and financials of the stock and discuss what investors should do with FPS right now.
Electrical Infrastructure Demand Is Supporting FPS’ Expansion
Forgent Power Solutions designs and manufactures electrical distribution equipment used in data centers, the power grid and energy-intensive industrial facilities. Its portfolio includes transformers, switchgear, panelboards, automatic transfer switches, power distribution units, generator connection cabinets and prefabricated electrical houses and power skids. Demand across these end markets supported an 89% increase in fiscal 2026 revenues to $1.42 billion compared with $753.2 million in fiscal 2025.
FPS’ data centers accounted for approximately 59% of revenue, Grid contributed 21%, Industrial 10% and other markets 10%. Data centers remain its largest end market. FPS’ offering is organized into Custom Products, Powertrain Solutions and Standard Products. FPS’ custom products are engineered for individual projects. Powertrain Solutions combine custom products into integrated systems, while Standard Products use common designs for basic applications.
In fiscal 2026, these categories contributed approximately 70%, 25% and 3% of revenue, respectively; services accounted for the remaining 2%. The company’s engineering-led approach is intended to address requirements involving power availability, uptime, equipment integration, thermal management and installation constraints. Its annual report describes early collaboration with customers to define system requirements and assess cost, performance and availability trade-offs. FPS’ design tools and reference designs support rapid customization, making them ideal for rapid data center and grid building.
Record Orders and Backlog Improve Revenue Visibility for FPS
FPS’ commercial activity accelerated in the fourth quarter of fiscal 2026. The company’s revenues reached $462 million, which increased 94% year over year, and bookings were $1.5 billion, which rose 375%. FPS’ book-to-bill ratio was 3.3 times. On June 30, 2026, backlog stood at approximately $3 billion, 256% above the prior-year level. The company stated that backlog covered more than 90% of its fiscal 2027 revenue guidance. However, FPS competes with Vertiv ((VRT - Free Report) ), Hubbell Inc. ((HUBB - Free Report) ) and Eaton Corporation plc ((ETN - Free Report) ). Vertiv is a leading provider of critical digital infrastructure and continuity solutions for data centers, communication networks and industrial facilities
Vertiv's portfolio includes power management, UPS systems, thermal management, cooling infrastructure and integrated data center solutions. Hubbell overlaps with Forgent in electrical components and power infrastructure, although its business has broader exposure to utility and grid modernization markets. Eaton competes with Forgent across several electrical infrastructure categories and benefits from rising investments in grid modernization and data center capacity.
However, FPS has its niche. FPS’ powertrain solutions are becoming more meaningful as revenues from this category increased 259% in fiscal 2026 and represented about one-quarter of annual revenue. FPS announced an additional $35 million investment at its Tijuana campus to increase Powertrain Solutions capacity by more than 50%. The expansion is expected to come online in the fourth quarter of fiscal 2027 and raise total revenue capacity to approximately $5.8 billion.
FPS’ first-quarter revenues are expected to be between $445 million and $465 million, and adjusted EBITDA to be $90 million to $100 million. For fiscal 2027, FPS expects revenues of $2.4 billion to $2.6 billion, adjusted EBITDA of $575 million to $625 million and adjusted EPS of $1.26 to $1.40. The Zacks Consensus Estimate for fiscal 2027 revenues and earnings is pegged at $2.6 billion and $1.34, respectively, indicating year-over-year growth of 79%.
Image Source: Zacks Investment Research
Conclusion: Buy FPS Stock Now
FPS’ strong revenue growth, record backlog, expanding Powertrain Solutions business and optimistic fiscal 2027 guidance support its long-term growth prospects. Moreover, its current P/S multiple below the industry average may offer an attractive entry point. However, investors should consider execution risks associated with capacity expansion, rising costs and dependence on data center demand. Given its growth outlook and valuation discount, investors may consider accumulating FPS gradually while monitoring quarterly execution and profitability. FPS sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.