Forgent Power Solutions: FQ3 Beats on Stronger Topline, Another $0.5B Backlog Pads Visibility

Research evidence excerpt

Forgent Power Solutions: FQ3 Beats on Stronger Topline, Another $0.5B Backlog Pads Visibility

Update

May 14, 2026 12:11 PM GMT

Morgan Stanley & Co. LLCMForgent Power Solutions | North America Christopher Snyder, CFA

Equity Analyst

FQ3 Beats on Stronger Topline, Chris.Snyder@morganstanley.comBrandon Knutson +1 212 761-4470

Brandon.Knutson@morganstanley.com +1 212 761-4168

Another $0.5B Backlog Pads Toby Okwara

Toby.Okwara@morganstanley.com +1 212 761-1693

Visibility Christine Yao

Research Associate

Christine.Yao@morganstanley.com +1 212 761-4193

Reaction to earnings

Forgent Power Solutions (FPS.N, FPS UN)

Unchanged Meaningful upside Modest revision higher

Multi-Industry | United States of America

Impact to our thesis Financial results versus consensus Direction of next 12-month

consensus EPS Stock Rating Equal-weight

Source: Company data, Morgan Stanley Research Industry View Attractive

Price target $38.00

Shr price, close (May 13, 2026) $45.52

Exhibit 1: FPS Quarterly Backlog Build ($mil) and Backlog as % of NTM Revenue: Mkt cap, curr (mm) $13,893

FPS added another $0.5B of backlog, derisking FY'27 topline. The analysis below 52-Week Range $46.08-25.99

assumes orders return to the LTM avg starting in the June Q (~$600M/Q) and

even in this conservative scenario, FPS continues to build backlog & sustain

~100% NTM coverage

Source: Morgan Stanley Research, Company Reports, Visible Alpha

FPS posted FQ3 EBITDA of $85M, outpacing MSe $79M and Cons $78M as a mid-

teens topline beat more than offset a ~140 bps margin miss. While the FQ3

mechanics matched our preview (topline upside, strong bookings, margin risk - link),

the sales beat came in much stronger than we anticipated & would peg buyside

bogeys calling for a 7-10% beat (vs 15% delivered). While the demand strength in