We recently compiled a list of the Why These 15 Stocks Are Skyrocketing in 2025. In this article, we are going to take a look at where Powell Industries, Inc. (NASDAQ:POWL) stands against the other stocks that are skyrocketing now.
The market has started to favor smaller companies in 2025, and stocks between $1 billion and $5 billion in market value are attracting renewed interest. These stocks had a forgettable stretch over the past few years, but investors now see evidence that underperformance among mid-cap and small-cap names could end soon.
The S&P MidCap 400 and S&P 600 indexes still trail large caps by a wide margin, yet smaller firms have held up well even as interest rates remain elevated. The valuation gap between these groups and the biggest names in the market has also widened to levels that analysts consider unusually attractive.
Investors now expect momentum to build for select companies in this sweet spot, and many of them are in fast-growing industries with strong fundamentals.
Methodology
For this article, I screened the top-performing stocks year-to-date in the $1 billion to $5 billion market capitalization bracket. Stocks that I have covered this week will be excluded from this list.
I will also mention the number of hedge fund investors for these stocks. Why are we interested in the stocks that hedge funds invest in? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
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Powell Industries, Inc. (NASDAQ:POWL)
Number of Hedge Fund Holders In Q3 2024: 26
Powell Industries (NASDAQ:POWL) makes custom electrical power solutions, and some of these are used in data centers.
POWL stock has been surging this year due to stellar performance and upbeat guidance for 2025. Revenue jumped 45% year-over-year to $1 billion, and net income rose 175% to $150 million.
Gross margins have also improved, and the company is seeing a lot of demand in petrochemical and oil & gas markets. The data centers could also fuel huge demand down the line.
Powell Industries noted that its backlog is at $1.3 billion. The cash balance is at $358 million with no debt.
The analyst consensus price target of $312 implies flat upside.
The stock is up 36.12% year-to-date.
Overall POWL ranks 7th on our list of the stocks that are skyrocketing in 2025. While we acknowledge the potential of POWL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than POWL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 10 Hottest Mid-Cap Stocks So Far in 2025 and 10 Hottest Smid-Cap Stocks So Far In 2025
Disclosure: None. This article was originally published at Insider Monkey.
