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Powell (POWL) Stock Is Up, What You Need To Know

POWL Cover Image

What Happened?

Shares of electrical energy control systems manufacturer Powell (NYSE: POWL) jumped 4% in the morning session after the company announced a definitive agreement to acquire Remsdaq Ltd., a UK-based manufacturer of automation and control solutions for the electrical industry. The deal, valued at £12.2 million, or approximately $16.3 million, was announced after the market closed on Tuesday. The transaction is expected to be finalized in the fourth quarter of Powell's fiscal 2025. Remsdaq specializes in producing Remote Terminal Units (RTUs), which are crucial for control and automation in electrical substations for power generation, transmission, and distribution. This acquisition is a key strategic move for Powell, aimed at enhancing its automation platform. The company plans to integrate its technology with Remsdaq's Supervisory Control and Data Acquisition (SCADA) RTUs. This will better position Powell to meet the increasing demand for sophisticated automation solutions and predictive analytics within the utility sector and the broader electrical industry.

After the initial pop the shares cooled down to $215.16, up 1.9% from previous close.

Is now the time to buy Powell? Access our full analysis report here, it’s free.

What Is The Market Telling Us

Powell’s shares are extremely volatile and have had 51 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was about 1 month ago when the stock gained 5.8% on the news that the major indices rebounded (Nasdaq +1.5%, S&P 500 +1.0%) as reports pointed to easing tensions between Israel and Iran. The Wall Street Journal said senior Iranian officials had signaled a willingness to restart stalled nuclear talks, on the condition that Washington refrain from joining Israel's ongoing strikes. This development triggered a significant decline in oil prices, easing inflation concerns. Also, it is possible some investors were buying the dip following the sell-off at the end of the previous week.

Powell is down 5.9% since the beginning of the year, and at $215.16 per share, it is trading 38.9% below its 52-week high of $352.37 from November 2024. Investors who bought $1,000 worth of Powell’s shares 5 years ago would now be looking at an investment worth $7,824.

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