SKS Technologies Group Ltd (ASX: SKS) shares are having a strong session on Thursday.
In morning trade, the ASX 300 stock is up 13% to $4.00.
Why is this ASX 300 stock jumping?
Firstly, if you are not familiar with SKS Technologies, it is a specialist in electrical technologies and digital infrastructure. It offers a diverse range of services across audio visual, communications, and electrical solutions throughout Australia.
It highlights that it supports a broad spectrum of industry sectors, including data centres, defence, mining, healthcare, retail, and commercial buildings.
This morning, the ASX 300 stock revealed that it has been awarded a range of contracts totalling $60 million across data centre and corporate clients. In light of this, it has upgraded its earnings guidance for FY 2026.
The recent contract awards include a package for the NextDC Ltd (ASX: NXT) M3 (Stage 4) data centre project and the full suite of SKS Technologies services for the new Melbourne office of Ernst and Young.
The company points out that the NextDC M3 project has been awarded by Kapitol Group, which is a Melbourne-based construction group that specialises in high-tech sectors.
The 150MW Tier IV facility will support rapidly growing artificial intelligence (AI) and cloud computing demand through high-density, fault-tolerant infrastructure.
Management believes this contract award endorses the reputation that SKS Technologies has built as a dominant provider of critical electrical solutions for the data centre sector over a short period of time. In addition, it supports the company's consistently high level of repeat business, which sat at 94% for FY 2025.
The commercial office project for Ernst and Young is in the landmark, 20 level tower at 111 Bourke Street, Melbourne. It was awarded by Shape Australia, which is a large modular construction and fitout company.
The contract requires a fully integrated solution across audio visual, communications, and electrical solutions. Management feels that this demonstrates SKS Technologies' continued and unwavering pursuit of work across all of its traditional sectors.
Guidance upgrade
In light of the above, the ASX 300 stock has upgraded its revenue and earnings guidance for FY 2026.
Revenue is expected to increase to $340 million (from $320 million previously), while its net profit before tax margin is expected to lift from 9% to 10%. These increases are expected to produce a profit before tax of $34 million (from $28.8 million previously).
The company's CEO, Matthew Jinks, said:
The revised outlook is based on a combination of new contract awards, a further record level of $325 million of work on hand, and a realistic confidence in future conversions from pipeline to contract award.
The post This ASX 300 stock is jumping 13% on earnings guidance upgrade appeared first on The Motley Fool Australia.
Motley Fool contributor James Mickleboro has positions in Nextdc. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Sks Technologies Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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