What Happened?

Shares of environmental solutions provider CECO Environmental (NASDAQ:CECO) jumped 18.3% in the afternoon session after the company reported strong first quarter 2025 results: its revenue surged past Wall Street's expectations, and adjusted EPS outpaced forecasts. The real story this quarter was a 40% jump in sales, fueled by record-breaking orders and a backlog that climbed 55%. Full-year guidance remained intact, with CECO expecting roughly 30% revenue growth and a 50% jump in adjusted EBITDA, showing confidence in its ability to execute despite macro uncertainties. Zooming out, we think this was a solid quarter.

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What The Market Is Telling Us

CECO Environmental’s shares are quite volatile and have had 16 moves greater than 5% over the last year. But moves this big are rare even for CECO Environmental and indicate this news significantly impacted the market’s perception of the business.

The biggest move we wrote about over the last year was 2 months ago when the stock gained 14.7% on the news that the company reported decent fourth-quarter results, surpassing analysts' expectations for revenue, EPS, and EBITDA. Revenue grew significantly, driven by record-high bookings and a 46% increase in backlog, signaling strong demand across its industrial and environmental businesses. On top of that, the company's full-year revenue and EBITDA guidance came in ahead of forecasts, adding to the positive momentum. Zooming out, we think this was a good quarter with some key areas of upside.

CECO Environmental is down 28% since the beginning of the year, and at $22.61 per share, it is trading 34.5% below its 52-week high of $34.51 from December 2024. Investors who bought $1,000 worth of CECO Environmental’s shares 5 years ago would now be looking at an investment worth $3,919.

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