AAON (AAON) Backlog Strengthens From Data Centre Buildout and Margin Improvement

AAON (AAON) Backlog Strengthens From Data Centre Buildout and Margin Improvement

Fri, July 31, 2026 at 5:06 PM GMT+3 3 min read

• AAON +3.95%

Spyglass Capital Management LLC, an investment management firm, released its second-quarter investor letter for "Spyglass Growth Strategy". A copy of the letter can be downloaded here. Spyglass Growth Strategy appreciated 24.63% in the second quarter, significantly outperforming the Bloomberg Midcap Growth Index's 14.05% increase, the Bloomberg 2500 Growth Index's 19.01% gain, and the Bloomberg 500 Index's 15.61% return for the same period. The Strategy's performance in Q2 was a reversal from Q2 driven by easing geopolitical tensions, notably a US-Iran ceasefire, declining oil prices, and a rebound in software stocks after early-year volatility. Small caps and growth stocks outperformed, with Technology, Industrials, and Financials leading sectors. The portfolio's earnings growth remains above 40%, while current valuations do not yet reflect this performance. Despite recent portfolio success—85% of companies exceeding revenue estimates—the overall portfolio faces multiple compression with a slight negative year-to-date return. However, the firm remains confident that fundamentals will prevail over volatility, emphasizing that the market's short-term inefficiencies may present opportunities for value extraction. In addition, please check the Firm's top five holdings to know its best picks in 2026.

In its Q2 2026 investor letter, Spyglass Growth Strategy highlighted AAON, Inc. (NASDAQ:AAON) as a material contributor. AAON, Inc. (NASDAQ:AAON) designs and manufactures high-efficiency air conditioning and heating equipment. On July 30, 2026, AAON, Inc. (NASDAQ:AAON) closed at $87.59 per share, reflecting a market capitalization of $7.17 billion. AAON, Inc. (NASDAQ:AAON) posted a one-month return of -15.50%, while its shares gained 11.38% over the past 52 weeks.

Spyglass Growth Strategy stated the following regarding AAON, Inc. (NASDAQ:AAON) in its Q2 2026 investor update:

"AAON, Inc. (NASDAQ:AAON), a commercial and industrial HVAC solutions provider, was a top contributor during the second quarter. AAON reported first-quarter results in May, exceeding consensus expectations for both revenue and earnings, and materially raising its full-year datacenter revenue targets, which seemed to help improve investor sentiment. We were encouraged by the Company's backlog, driven by continued strength from the datacenter buildout, as well as improving margins, which we expect to build as capacity absorption improves. We continue to believe the depth of the data center opportunity is not fully understood by most investors."

AAON, Inc. (NASDAQ:AAON) is not on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 30 hedge fund portfolios held AAON, Inc. (NASDAQ:AAON) at the end of the first quarter, compared to 36 in the previous quarter. While we acknowledge the potential of AAON, Inc. (NASDAQ:AAON) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on thebest short-term AI stock.

In another article, we covered AAON, Inc. (NASDAQ:AAON) and shared Wasatch Small Cap Growth Strategy's views on the company. In addition, please check out our hedge fund investor letters Q2 2026 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.