ESCO Technologies (ESE) is back on investors' radar after strong first quarter 2026 results, a sharp uptick in Aerospace & Defense activity, and a raised full year revenue and earnings outlook.

Those earnings and guidance updates have come alongside a sharp move in the share price, with a 27.36% 1 month share price return and 38.02% year to date share price return. The 1 year total shareholder return of 66.09% and 3 year total shareholder return of about 2.9x indicate strong momentum that recent Aerospace & Defense strength and the raised outlook appear to have reinforced, despite a 3.68% 1 day pullback to US$272.76.

If strong order books and upgraded outlooks catch your attention, it could also be a good time to look at other industrial and infrastructure names through our 25 power grid technology and infrastructure stocks.

With ESCO now trading close to one analyst’s US$285 price target and carrying an elevated P/E versus many peers, investors may need to consider whether there is still upside potential or whether the market is already pricing in future growth.

Most Popular Narrative: 7% Overvalued

At a last close of $272.76 versus a narrative fair value of $255.00, ESCO Technologies is framed as trading at a premium, with that view built on detailed growth and margin assumptions discounted at 8.40%.

Strong multi-year backlog growth in Aerospace & Defense, anchored by substantial orders related to submarine programs and long-term military contracts, provides high revenue visibility and improved operating leverage, resulting in sustained organic growth and higher segment margins.

Read the complete narrative. Read the complete narrative.

Want to see what kind of revenue path and margin uplift would justify paying above fair value today? The most followed narrative leans on compounded earnings expansion and a premium future earnings multiple. Curious how those ingredients come together to still support an overvalued tag at today’s price? The full breakdown lays out the numbers in black and white.

Result: Fair Value of $255 (OVERVALUED)

However, that story depends on successful Maritime integration and steady utility and renewables demand, and setbacks in either could quickly challenge the current case for overvaluation.

Build Your Own ESCO Technologies Narrative

If you see the numbers differently or prefer to test your own assumptions against the same data, you can build a fresh ESCO view in just a few minutes, so why not Do it your way today.

A great starting point for your ESCO Technologies research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.