CECO Environmental Corp. (NASDAQ:CECO) shares surged 8.57% in pre-market trading on Monday after the environmental technology company delivered second-quarter results that comfortably exceeded Wall Street expectations and raised its full-year outlook.
Adjusted earnings per share reached $0.47, beating the analyst consensus of $0.27 by $0.20. Revenue came in at $285 million, ahead of the $272 million expected by analysts and up 54% from $185.4 million in the same quarter last year.
On a GAAP basis, however, CECO reported a loss of $0.80 per share, compared with earnings of $0.26 per share in the second quarter of 2025.
CECO raises 2026 revenue and EBITDA forecasts
Following the stronger-than-expected quarter, CECO increased the lower end of its full-year revenue forecast.
The company now expects 2026 revenue of between $1.300 billion and $1.375 billion, compared with its previous guidance range of $1.275 billion to $1.375 billion.
The midpoint of the revised range stands at approximately $1.338 billion, above the analyst consensus forecast of $1.312 billion.
CECO also raised its adjusted EBITDA guidance to a range of $200 million to $225 million, compared with its previous forecast of $195 million to $225 million.
The improved outlook reflects growing confidence in the performance of the enlarged business following its acquisition of Thermon.
Thermon acquisition drives orders and backlog sharply higher
The second quarter represented CECO’s first reporting period as a combined company following the completion of its Thermon acquisition on June 1, 2026.
Orders climbed 191% to $798.5 million, providing a substantial pipeline of future business, while backlog increased 164% to $1.82 billion.
Adjusted EBITDA rose 73% year-on-year to $40.2 million, corresponding to an adjusted EBITDA margin of 14.1%.
“We delivered an exceptional second quarter, with numerous financial records led by tremendous growth in both orders and backlog,” said Todd Gleason, Chairman and Chief Executive Officer. “Early synergy capture is proceeding ahead of our pre-acquisition integration objectives, and we are driving strong execution across the combined organization.”
The early progress on integration and synergies following the Thermon transaction provides an important indication of whether the acquisition can deliver the financial benefits anticipated by management.
Free cash flow improves substantially
CECO also reported a significant improvement in cash generation during the quarter.
Adjusted free cash flow reached $53.2 million, representing a $56.2 million improvement from the negative $3.0 million recorded in the corresponding quarter last year.
The combination of stronger revenue, accelerating orders, a significantly larger backlog and improved cash generation helped underpin the positive market reaction.
With CECO also raising its 2026 revenue and adjusted EBITDA forecasts, investors are now looking for the company to sustain its operating momentum while continuing to capture integration benefits from the Thermon acquisition.
Ceco Environmental stock price
