Graham Corporation is a Trump trade, analyst says

Trump admin 2.0 hasn’t exactly been a boon for the stock market, in fact the opposite is true.

But one analyst has identified a stock he thinks will benefit from the administration.

Beacon Securities analyst Russell Stanley thinks Graham Corporation (Graham Corporation Stock Quote, Chart, News, Analysts, Financials NYSE:GHM) will benefit from Trump’s plans for the shipbuilding industry.

Stanley says the stock, which is down more than 40%, could soon gain some big tailwinds.

“During last night’s address to Congress, President Trump announced plans to establish a shipbuilding office within the White House, adding he wants to “resurrect the American shipbuilding industry” commercially and militarily,” the analyst wrote. “He predicted that the US is going to build ships “very vast, very soon, and it will have a huge impact.” The Wall Street Journal reported reviewing a draft of an executive order featuring 18 measures, including raising fees on Chinese built ships/cranes entering the US, establishing a new office at the National Security Council, raising wages for nuclear shipyard workers, and instructions to the Department of Government Efficiency to review government (including the Navy) procurement processes. The WSJ added that that an unnamed shipping industry official indicated the order was influenced by National Security Adviser Mike Waltz, who is generally considered hawkish on China. We view the announcement/reporting as bullish for US Navy demand and supportive of our GHM thesis. Major shipbuilders are responding positively, with General Dynamics (GD-NYSE, Not Rated) up 2%, and Huntington Ingalls (HII-NYSE, Not Rated) up 10%, as of writing.”

In a research update to clients March 5, Stanley maintained his “Buy” rating and price target of $55.00 on GHM, implying a return of 84% at the time of publication.

The analyst thinks the company will post Adjsuted EBITDA of $19.0-million on revenue of $206.0-million in fiscal 2025. He expects those numbers will improve to Adjusted EBITDA of $25.0-million on a topline of $226.0-million in fiscal 2026.

“GHM is now trading at 8.4x our F2027 adj EBITDA forecast (equivalent to C2026 given the March 31 FYE),” Stanley added. “That multiple represents a 44% discount to the 15.1x at which DRS trades, though we expect GHM to deliver 3x the growth (an EBITDA CAGR of 39% v. DRS consensus at 13%). Potential GHM-specific catalysts include contract wins, M&A activity and the Q4 results in June.”