AAON: Shares Are Overheating (Downgrade)

AAON, Inc. is downgraded to a soft Sell due to extreme valuation despite strong operational performance and data center-driven growth. Q1 revenue surged 54.3% to $496.9M, with backlog doubling year-over-year to $2.13B, supporting management's 40–45% revenue growth guidance for 2026. All segments, especially BASX, delivered robust top-line growth, but rising raw material costs compressed gross margins from 26.8% to 25.1%.