Arxis, Inc. (ARXS)

Price$54.01Cached quoteAs of 2026-09-04 16:23 UTC

AI: Overvalued

Price checkThe shares look expensive even after strong growth and a much healthier balance sheet.

Using roughly 431 million known common shares after the Omnetics closing and the latest close, Arxis has about $22.8 billion of equity value. Adding June net debt of roughly $1.22 billion gives an approximate $24.0 billion enterprise value, before later balance-sheet changes. Trailing net income is about $144 million and free cash flow—cash left after running and investing in the business—is about $263 million. That is roughly 158 times earnings and 87 times free cash flow. Against July’s adjusted profit guidance, enterprise value is still about 30 times the midpoint.

Big pictureRevenue and cash generation are rising fast, but reported profits remain less durable.

Revenue rose from $743 million in 2024 to $1.59 billion in 2025, then reached $960 million in the first half of 2026, up 23% from the prior-year period. Trailing operating cash flow is about $306 million and free cash flow about $263 million. Yet second-quarter net income was a $4.9 million loss, while stock-based compensation was about $100 million. Because stock compensation is added back in cash flow but can dilute shareholders, per-share cash durability is weaker than the headline cash number suggests.

Business strengthStrong pricing, volume growth, and debt reduction give Arxis real operating momentum.

Gross margin improved from about 44.6% in 2024 to 47.4% in 2025 and reached 52.4% in the second quarter, versus 49.3% a year earlier. Second-quarter organic revenue, meaning growth excluding recent acquisitions, rose 21%, helped by mid-teens volume growth and mid-single-digit pricing. Cash reached $495 million while net debt fell to about $1.22 billion after IPO proceeds repaid $946 million of borrowings. Current assets were more than five times current liabilities, although $2.80 billion of goodwill makes the asset base heavily acquisition-dependent.

What could change the storySustained twenty-percent growth could justify more, while slower growth would expose the valuation.

The bull case is continued near-20% organic growth, rising cash conversion and successful acquisitions. The bear case is slower defense spending, aerospace production or industrial automation demand while the valuation stays high. Capital allocation also matters: Omnetics added about 3.1% new shares; June filings showed 58.9 million incentive-plan shares available and 13.4 million other potentially dilutive securities. No buybacks or dividends appeared in the supplied history. At the current equity value, free cash flow would need to approach roughly $760 million—almost three times the trailing level—to reach about 30 times free cash flow.

AI: News

Q2 beat and guidance raiseSecond-quarter growth accelerated, and management raised its full-year revenue and profit outlook substantially.

On July 29, Arxis reported second-quarter revenue of $501 million, up 25%, including 21% organic growth, while adjusted EBITDA rose 38% to $211 million. Management raised 2026 revenue guidance by $100 million at the midpoint to $1.96-$1.98 billion and adjusted EBITDA guidance by $70 million to $790-$800 million. The shares rose 15.3% in the next regular session. That timing is consistent with a positive earnings reaction, although price movement alone cannot prove the report caused the entire gain.

Omnetics acquisition closesArxis completed a large stock-funded acquisition, adding capabilities but also immediate shareholder dilution.

On August 18, Arxis announced completion of the Omnetics acquisition at an agreed enterprise value of about $770 million. It issued 13,351,964 Class A shares to the sellers, equal to roughly 3.1% of total common stock at closing. Management said the combined Omnetics and MagCanica purchase price was about 12 times estimated fiscal-2027 adjusted EBITDA. The deal can add high-reliability connector earnings, but shareholders must weigh that growth against dilution and integration risk. The stock fell about 1.8% that session; attribution is uncertain.

Acquisition program expandsThe Omnetics and MagCanica deals confirmed acquisitions remain a central growth engine.

On June 2, Arxis announced a combined purchase price of about $890 million for Omnetics and MagCanica, equal to roughly 12 times estimated fiscal-2027 adjusted EBITDA. Omnetics was structured mainly as an all-stock transaction, while MagCanica was purchased for cash. The strategy broadens Arxis in defense, space, aerospace and precision sensing, but it also makes future value creation depend on disciplined purchase prices and integration. The announcement established that acquisition spending, not only organic growth, will remain a major driver of reported results.

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Revenue

2023

2024

2025

Net income

2023

2024

2025

Free cash flow

2023

2024

2025

Total cash / debt

CashTotal debt

2024

2025

Financial statements

	2025	2024	2023
Revenue	$1.59B	$743.0M	$424.5M
Gross profit	$754.7M	$331.1M	$194.0M
Gross margin	47.44%	44.57%	45.71%
Operating expenses	$650.2M	$228.5M	$139.7M
Operating income	$107.9M	$102.6M	$54.3M
Operating margin	6.78%	13.81%	12.80%
EBITDA	$314.0M	$204.4M	$120.5M
EBITDA margin	19.73%	27.50%	28.38%
Net income	$62.3M	−$53.0M	−$69.3M
Net profit margin	3.92%	−7.13%	−16.33%
Basic EPSper basic share	-$0.12	-$0.14	-$0.15
Diluted EPSper diluted share	-$0.12	-$0.14	-$0.15

Review official source filings ↗

Owners

Reported shareholders

Reference date Jun 30, 2026

6.68%of listed shares

T. Rowe Price Investment Management, Inc.5.13M shares · Jun 30, 2026

View holders

Top 20 reported holders of ARXS
Holder	% owned
T. Rowe Price Investment Management, Inc.	6.68%5.13M shares
Jupiter Topco LLC	5.88%4.52M shares
Capital International Investors	4.69%3.6M shares
Capital Research Global Investors	4.68%3.6M shares
Perhamus Kevin Scott	≈4.65%3.57M shares
PRICE T ROWE ASSOCIATES INC /MD/	4.04%3.11M shares
AMERIPRISE FINANCIAL INC	3.46%2.66M shares
BlackRock, Inc.	2.86%2.2M shares
VANGUARD CAPITAL MANAGEMENT LLC	2.43%1.86M shares
Invesco Ltd.	2.39%1.83M shares
CITADEL ADVISORS LLC	2.09%1.61M shares
MASSACHUSETTS FINANCIAL SERVICES CO /MA/	2.00%1.54M shares
VANGUARD PORTFOLIO MANAGEMENT LLC	1.95%1.5M shares
Capital World Investors	1.89%1.45M shares
RAYMOND JAMES FINANCIAL INC	1.84%1.41M shares
Temasek Holdings (Private) Ltd	1.79%1.37M shares
FMR LLC	1.69%1.3M shares
ARES MANAGEMENT LLC	1.63%1.25M shares
NORGES BANK	1.63%1.25M shares
Sealfon Ross Bradley	≈1.44%1.1M shares

Percentages use 76.8M shares of this listed class outstanding on Jun 30, 2026. ≈ compares the latest reported holding with a share total from a different date; it is not a confirmed current stake.

Gray completes the 100% scale. Reported positions may overlap; holders have different reporting dates.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys7$5.64M disclosed value

Sells (SEC code S)0$0.00 disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Apr 17, 2026Form 4	Jankowski Ryan AnthonyChief Accounting Officer	BuyClass A Common Stock	4.5K	$28.00	$125.0K	51.3K
Apr 17, 2026Form 4	Badakhsh Azad SidSee Remarks	BuyClass A Common Stock	36.0K	$28.00	$1.01M	403.9K
Apr 17, 2026Form 4	Sealfon Ross BradleySee Remarks	BuyClass A Common Stock	12.5K	$28.00	$350.0K	1.10M
Apr 17, 2026Form 4	Oetgen Stephen DuaneDirector	BuyClass A Common Stock	25.0K	$28.00	$700.0K	30.4K
Apr 17, 2026Form 4	ALLEN PATRICK EDirector	BuyClass A Common Stock	10.0K	$28.00	$280.0K	15.4K

Review ownership filings at SEC.gov ↗

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Arxis, Inc. (ARXS)

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