Shares of Argan broke out past a buy point Thursday, while Quanta Services beat estimates and raised its outlook. The moves helped feed a four-month rally by the No. 2 heavy construction industry group. Argan stock rose 1.5% in afternoon trading.
Argan stock broke out of a base-on-base pattern and traded near the 246.60 buy point in morning trading. The stock ceded some gains, however, as the general market faded. Argan trading was heavy, and the relative strength line is near new highs. Both are positive signs for the breakout.
Arlington, Va.-based Argan has the highest-possible EPS Rating of 99, after the company posted earnings gains of 39%, 400%, 149% and 176% the past four quarters. Sales grew 61%, 57%, 41% and 23% over the same period.
Its Composite Rating is 98 out of 99.
Meanwhile, Quanta reported its second-quarter sales climbed 21% to $6.77 billion and earnings rose 31% to $2.48 a share. Both numbers exceeded FactSet's analyst consensus estimates.
Quanta had already completed three acquisitions in the first half of 2025 and announced it concluded another one Thursday. It closed a deal for Austin, Texas-based construction firm Dynamic Systems.
With the acquisition completed, Houston-based Quanta raised its full-year sales guidance to $27.4 billion-$27.9 billion and moved up its profit forecast to $10.28 to $10.88 a share.
Argan Stock And Quanta Fade
Quanta stock rose almost to an all-time high early Thursday but reversed lower 2% as the stock market pared gains. The stock remains above its 21-day exponential and 50-day simple moving average. Shares are up 15% from a June 3 breakout at a 348.90 buy point.
Both Quanta and Argan provide services related to the construction of power plants and infrastructure, which are much in demand as artificial intelligence workloads increase demand for electricity. IBD's heavy construction industry group is ranked No. 2 and is up 85% from its April 7 low. Year to date, the group is up 34%, also boosted by rising construction of data centers and factories.
"Demand for our services remains resilient, fueled by our customers' multiyear programs to build the power grid, generation and energy infrastructure necessary to support load growth from technology adoption and manufacturing reshoring … .," Quanta CEO Duke Austin said in the earnings release.
JPMorgan On Argan Stock
On July 21, JPMorgan Chase initiated coverage on Argan stock with a neutral rating, saying the stock is fairly valued. It put the price target at 220. Analysts believe Argan is in a good position to benefit from rising U.S. energy demand and gas power plant expansions.
Argan stock has a 21-day average true range (ATR) of 4.79% and Quanta's is 2.56%. The average true range is a metric available on IBD's MarketSurge that gauges the characteristic breadth of a stock's behavior. Stocks with a high ATR tend to make large price moves that can trigger sell rules. Stocks with lower ATRs tend to make more incremental moves.
With the S&P 500 and Nasdaq now in a power trend, investors can buy stocks with ATRs up to 8%, though they should be wary of being too concentrated in high-octane names.
