Graham Corporation exhibits a robust margin profile that stands well above its historical averages and peers. All three profitability metrics—gross, operating, and net margins—are not only higher than the 10‑year averages (21.7%, 1.7% and 1.5% respectively) but also sit in the upper quartile of their long‑term distributions, with percentiles ranging from the 74th to the 78th. Moreover, each margin has shown consistent year‑over‑year improvement—gross margin up 3.3%, operating margin up 3.5%, and net margin up 3.4%—and strong three‑year cumulative gains of 17.8%, 16.5% and 13.0% respectively, indicating an accelerating profitability trend. There are no structural erosion signals; the multi‑year trajectory is clearly upward, suggesting that recent improvements are not merely cyclical rebounds but reflect sustainable operational enhancements. The absence of alerts underscores a clean margin profile, positioning Graham Corporation favorably for continued earnings expansion over the next 12‑18 months.

Graham Corporation (GHM) exhibits a very low debt profile, with its current Debt-to-Equity ratio of 0.06x matching the ten‑year average and sitting at the 20th percentile of its historical range. The net‑debt to EBITDA metric is negative (-0.7x), indicating that cash flow from operations more than offsets interest‑bearing liabilities; this figure also outperforms the ten‑year average of -3.2x and resides in the 70th percentile, reflecting a strong balance sheet relative to historical norms. There are no active alerts on leverage or solvency, and trends suggest modest improvement in Debt-to-Equity while net‑debt/EBITDA remains stable, underscoring a clear and sustainable debt position for the next 6‑18 months.

Graham Corporation’s cash generation profile is markedly weak, with both operating cash flow and free cash flow reported at $0.0 billion for the current period. Year‑over‑year changes of -$3.8 million in operating cash flow and -$13.5 million in free cash flow underscore a transition from positive cash generation to outright negative output, eroding the firm’s ability to fund capital expenditures or debt service without external financing. Liquidity metrics further accentuate stress: the current ratio has slipped to 1.04×—well below its 10‑year average of 2.41× and trending downward for four consecutive years—while the quick ratio is only 0.74× versus a historic average of 2.06×, indicating insufficient liquid assets to cover near‑term obligations. Although the cash ratio remains stable at 0.16×, it is far beneath the 0.65× ten‑year norm, offering little cushion against sudden cash outflows.

Graham Corporation’s earnings quality exhibits mixed signals. The operating cash flow to net income ratio has slipped to 1.99x from a ten‑year average of 2.52x, indicating that each dollar of reported profit is now supported by less than two dollars of cash—a clear deterioration and a potential red flag for sustainability. Meanwhile, the company’s capital intensity has surged, with capex consuming 78% of operating cash flow versus a historical norm of 16%, suggesting that a large share of cash generation is being reinvested rather than retained for dividends or debt reduction. On the positive side, the accrual ratio remains modestly negative at –0.046, close to its ten‑year average and well within comfortable bounds, implying limited earnings manipulation through aggressive accruals.