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what it is
CECO sells the filters, pumps, scrubbers, and exhaust systems factories need to keep air and water clean.
how it gets paid
Last year Ceco Environmental made $774M in revenue. Air pollution control was the main engine at $270M, or 35% of sales.
why it's growing
Revenue grew 38.8% last year. The 34.6% gross margin matters most because it shows whether CECO's project mix is getting richer or just bigger.
what just happened
Latest results showed $560M in revenue, $1.29 in EPS, and a 34.6% gross margin.
At a glance
B+ balance sheet — decent shape, but not bulletproof
30/100 earnings predictability — expect surprises
11.7x trailing p/e — the market's not buying it — or you found a deal
4.2% return on capital — nothing to write home about
$0.36 fy2024 eps est
xvary composite: 63/100 — average
What they do
CECO sells the filters, pumps, scrubbers, and exhaust systems factories need to keep air and water clean.
When your plant needs emissions control or fluid handling, failure is expensive and visible. CECO sells custom hardware across 40+ countries and runs with 1,600 employees, which matters because buyers do not casually replace mission-critical filtration and exhaust systems once they are installed.
How they make money
$774M
annual revenue · their business grew +38.8% last year
Air pollution control
$270M
Fluid handling
$170M
Air and liquid filtration
$150M
Product recovery equipment
$104M
Engineered components and fabrication
$80M
The products that matter
industrial air pollution control
Peerless & Kirk & Blum
$329.3M in quarterly orders
This business booked $329.3M in orders last quarter, up 50% from a year ago. That's the clearest evidence the demand side is working. It is also why the stock gets no patience if that pace fades.
orders drove the quarter
water and wastewater systems
Kemco Systems
$~300M business line
This is roughly a $300M exposure in the snapshot data, tied to industrial and battery-related buildouts. In human-speak: when customers build plants, this helps. When they wait, this feels it fast.
industrial capex exposure
electrification and transition projects
Energy Transition Solutions
$~145M exposure
At about $145M, it's smaller than the core air and water businesses. It still matters because investors hunting for a reason to pay 40.4x forward earnings tend to look here first.
valuation hinge
Key numbers
$774M
annual revenue
That is the scale you are buying today, and it grew 38.8% vs. prior year based on the latest annual filing.
4.2%
capital return
Return on capital means profit generated from the money tied up in the business, so 4.2% says growth is real but efficiency is still weak.
9.8%
operating margin
Operating margin means profit after running the business, before interest and taxes, so 9.8% tells you CECO is profitable but not exactly printing money.
$219M
long-term debt
Debt equals 10% of capital, which is manageable now, but it gives CECO less room if project execution slips.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 2 — safer than 80% of stocks
- price stability 25 / 100
- long-term debt $219M (10% of capital)
B+ — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for CECO right now.
source: institutional data · return history unavailable
What just happened
beat estimates
Latest results showed $560M in revenue, $1.29 in EPS, and a 34.6% gross margin.
Revenue jumped 183% vs. prior year in the latest reported quarter, while EPS surged 3125%. Jargon check: gross margin → money left after direct costs → so what, CECO kept 34.6 cents of each sales dollar before overhead.
$560M
revenue
$1.29
eps
34.6%
gross margin
the number that mattered
The 34.6% gross margin matters most because it shows whether CECO's project mix is getting richer or just bigger.
source: company earnings report, 2026
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What could go wrong
CECO's risk is not abstract. You are underwriting a company at 40.4x forward earnings that just raised the bar to $925M–$975M of 2026 revenue while preparing for a $2.2B Thermon merger.
high
Thermon merger integration
CECO is taking on a $2.2B deal expected to close mid-2026, with current shareholders owning 62.5% of the combined company. If integration gets messy, the story shifts from growth to complexity very quickly.
high-impact
high
backlog conversion risk
More than $1.5B of 2026 orders sounds great. It only counts if those orders become revenue, margin, and cash. If bookings miss or conversion slows, the premium multiple has less to stand on.
high-impact
med
margin slippage
Gross margin was 35.1% in the quarter, down 70 basis points. When return on capital is only 4.2%, even small leaks matter because there is not much excess profitability to absorb them.
med-impact
med
industrial and energy spending cycles
The story leans on industrial buildouts, water projects, and transition spending. The snapshot flags roughly $300M of water exposure and about $145M of transition exposure. If customers pause projects, those lines feel it first.
med-impact
What would change our mind: if 2026 orders fail to clear the $1.5B target, if revenue falls short of $925M–$975M, or if the Thermon close slips and margin keeps fading, the execution thesis breaks. That's the whole game here.
source: institutional data · regulatory filings · risk analysis
Pay attention to
orders
the $1.5B bookings test
Management's 2026 outlook calls for more than $1.5B of orders. If quarterly bookings cool off, the valuation argument cools off with them.
calendar
mid-2026 Thermon close
The deal is expected to close mid-2026. That date matters because investors are already judging CECO as if the combined-company story arrives on schedule.
margin
gross margin after the growth burst
Q4 gross margin was 35.1%, down 70 basis points. You want the next prints to show growth is still high quality, not merely high volume.
earnings
Q1 2026 follow-through
Expected around May 5, 2026. After a guide-up quarter, the next report has one job: prove Q4 was a trend and not a single loud quarter.
Analyst rankings
earnings predictability
30 / 100
Low predictability means the quarterly numbers can move around more than you'd like. In human-speak: this is not the kind of industrial stock you buy for a smooth ride.
risk rank
2
This measure says CECO screens safer than many stocks on balance-sheet and stability factors. Useful context. It does not erase merger risk.
price stability
25 / 100
The stock has not been calm. With a 52-week range of $18–$82, the market has been voting in all caps.
source: institutional data
Institutional activity
institutional ownership data for CECO is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$68
current price
n/a
target midpoint · n/a from current
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