Breaking Down Oshkosh Corporation (OSK) Financial Health: Key Insights for Investors

You're looking at Oshkosh Corporation, a powerhouse in purpose-built vehicles, and trying to see past the noise of a mixed 2025; honestly, the story is one of internal strength offsetting external caution. While the Access segment faced headwinds, leading to a Q3 sales dip of 1.9% to $2.69 billion, the Vocational segment is defintely picking up the slack, surging 18.9% in sales to $968.0 million for the quarter, driven by strong municipal demand. This internal rebalancing supports the company's full-year net sales guidance of $10.3 billion to $10.4 billion, plus the impressive adjusted earnings per share (EPS) forecast of $10.50 to $11.00. Here's the quick math: the massive consolidated backlog of over $14.2 billion acts as a powerful buffer, giving investors a clear line of sight on revenue for the next few years, but what this estimate hides is the continued pressure on the Access business, which saw sales drop 18.6% in Q3 alone. Still, the ramp-up of the Next Generation Delivery Vehicle (NGDV) in the Transport segment provides a long-term growth catalyst you shouldn't ignore.

Revenue Analysis

You need to know where Oshkosh Corporation's (OSK) money is coming from right now, and the picture for FY2025 is one of transition: overall revenue is facing near-term headwinds, but the underlying mix is shifting to more profitable segments. The trailing twelve months (TTM) revenue ending September 30, 2025, was approximately $10.33 billion, which represents a slight year-over-year decline of about -2.52%. The full-year 2025 revenue forecast has been revised to a range of $10.3 billion to $10.4 billion, down from earlier guidance, which is a clear signal of market softness in key areas. It's a mixed bag, so you defintely need to look under the hood.

Oshkosh Corporation's primary revenue streams flow from three major business segments-Access, Vocational, and Transport-which manufacture purpose-built vehicles and equipment. The Access segment, which includes JLG aerial work platforms (AWPs) and telehandlers, is typically the largest contributor. The Vocational segment builds fire apparatus, refuse/recycling collection vehicles, and airport equipment. Finally, the Transport segment handles defense contracts and specialty vehicles like the Next Generation Delivery Vehicle (NGDV) for the United States Postal Service (USPS).

Here's the quick math on how those segments are expected to contribute to the projected 2025 full-year revenue of roughly $10.6 billion (based on the Q2 outlook before the final revision, which still provides the best segment breakdown):

The real story isn't just the overall number, but the significant changes happening within each segment, which map to clear near-term risks and opportunities. The year-over-year revenue trend has reversed from the strong 11.1% increase seen in 2024, but that slowdown is not uniform across the company.

What this estimate hides is the dynamic shift in segment performance. You are seeing a deliberate pivot away from certain legacy programs and a ramp-up in new, high-value contracts. This is how the revenue streams are changing:

• Access Segment Headwinds: Revenue is declining due to lower North American sales volume and the expiration of the CAT agreement.
• Vocational Segment Strength: This segment is delivering robust growth, with sales increasing due to higher volume and favorable pricing, especially for refuse and recycling collection vehicles.
• Transport Segment Transition: Sales are declining primarily because of the wind-down of the domestic Joint Light Tactical Vehicle (JLTV) program, a major defense contract.
• NGDV Ramp-up: The decline in Transport is being partially offset by the ramp-up of the Next Generation Delivery Vehicle (NGDV) production for the USPS, a long-term, high-visibility contract.

So, while the top-line revenue growth is negative for the TTM, the strength in Vocational is helping to offset the cyclical weakness in Access and the strategic wind-down in Transport. This portfolio balance is a key factor to consider as you dive deeper into the company's valuation. You can find more on the institutional interest in this shift at Exploring Oshkosh Corporation (OSK) Investor Profile: Who's Buying and Why?

Profitability Metrics

You're looking for a clear picture of how efficiently Oshkosh Corporation (OSK) is turning its sales into profit, and honestly, the 2025 fiscal year data (ending September 30, 2025) shows a mixed but generally solid performance, especially when you look past the headline numbers.

The key takeaway is that while the company's overall profitability is expected to dip slightly from 2024 highs, its operational efficiency, particularly in its core segments, remains strong and competitive against industry peers. Here's the quick math on the trailing twelve months (TTM) ending September 30, 2025, using a TTM Revenue of $10.332 billion and a TTM Gross Profit of $1.842 billion.

• Gross Profit Margin: 17.83%
• Operating Profit Margin (Q3 2025): 9.7%
• Net Profit Margin (TTM): 6.45%

Margin Analysis and Industry Benchmarks

Oshkosh Corporation's gross profit margin of approximately 17.83% is a signal of strong cost management, but it sits within a tight band for the heavy equipment sector. To be fair, this is an asset-heavy industry, so margins are naturally lower than, say, software companies.

Comparing this to industry averages is crucial. For the broader Auto Manufacturers sector, the average Gross Profit Margin is around 18.1%, and for the Auto and Truck industry, it can be as low as 12.45%. Oshkosh is right in that competitive sweet spot. The Net Profit Margin of 6.45% is also healthy, beating the average for Auto Manufacturers at 4.5% and the Aerospace & Defense sector (where their Transport segment competes) at 5.7%.

Operational Efficiency and Profitability Trends

The trend for 2025 is one of margin resilience despite revenue headwinds. Management's full-year 2025 revenue guidance, with a midpoint of $10.35 billion, was lowered due to softer demand in the Access and Transport segments, and analysts anticipate a dip in full-year earnings compared to 2024. Still, the company is defintely managing costs well.

The reported Q3 2025 Operating Margin of 9.7% is a testament to operational efficiency (cost management, or how much profit is left after all operating expenses). The CEO highlighted maintaining double-digit adjusted operating margins in key segments like Vocational and Transport, even with lower sales volume. This suggests that pricing power and cost-saving initiatives are successfully offsetting the impact of lower production volume and one-time defense warranty costs. This focus on efficiency is what protects your bottom line in a challenging economic environment. For a deeper look at the company's long-term strategy, check out their Mission Statement, Vision, & Core Values of Oshkosh Corporation (OSK).

Debt vs. Equity Structure

Oshkosh Corporation (OSK) maintains a conservative and healthy capital structure, relying significantly more on shareholder equity than on debt to finance its operations and growth. This low-leverage approach is a clear signal of financial strength to investors.

As of September 30, 2025, the company's total debt stood at $1,206.4 million, which is a manageable figure when compared to its total shareholders' equity of $4,537.3 million. This debt includes both long-term obligations, which were approximately $1.100 billion for the quarter, and a smaller portion of short-term debt. The balance is defintely tilted toward equity, which limits financial risk.

The company's Debt-to-Equity (D/E) ratio, a key measure of financial leverage (how much debt is used to finance assets relative to equity), is exceptionally low. Here's the quick math:

• Oshkosh Corporation's D/E Ratio (September 30, 2025): 0.27

This means for every dollar of equity, Oshkosh Corporation uses only 27 cents of debt. Compare this to industry benchmarks in their operating segments:

Oshkosh Corporation's ratio of 0.27 is significantly lower than the average D/E for both the Aerospace & Defense industry (0.38) and the Specialty Industrial Machinery sector (0.85), indicating a much less leveraged position than its peers. This lower leverage is intentional; the company targets a debt to total capitalization ratio of 21.0%, which is well within the range favored by credit rating agencies.

The company's conservative financing strategy is validated by its investment-grade credit rating. S&P Global Ratings affirmed Oshkosh Corporation's long-term credit rating at 'BBB' with a stable outlook in March 2025. This rating is crucial because it lowers the cost of borrowing for future growth initiatives.

In terms of recent activity, the company is actively managing its debt portfolio. For the first half of 2025, they reported $2,838.0 million in proceeds from debt issuance alongside $2,302.2 million in debt repayments, showing high activity in a dynamic interest rate environment. Plus, in March 2025, they secured a new $500 million unsecured term loan to pay down their revolving credit facility, which gives them more flexibility. This constant refinancing and debt management ensures they are using debt strategically, primarily for working capital and targeted acquisitions, rather than simply piling it on.

If you want to dive deeper into the full picture of their financial health, check out the full post at Breaking Down Oshkosh Corporation (OSK) Financial Health: Key Insights for Investors.

Liquidity and Solvency

Oshkosh Corporation (OSK) demonstrates a strong overall liquidity position, primarily driven by a healthy Current Ratio and significant free cash flow generation projected for the 2025 fiscal year. You should see this as a clear sign of the company's ability to cover its near-term obligations, but the Quick Ratio suggests a reliance on inventory that we need to watch.

Here's the quick math on their short-term financial health, based on recent 2025 data:

• Current Ratio: The ratio stands at a robust 1.98. This means Oshkosh Corporation has almost two dollars in current assets (cash, receivables, inventory) for every dollar of current liabilities, a very comfortable buffer.
• Quick Ratio (Acid-Test Ratio): This is at 0.92. This ratio excludes inventory, so it's a more stringent test of immediate liquidity. Honestly, a ratio below 1.0 is common for manufacturers like Oshkosh Corporation, but it defintely highlights that a significant portion of their current assets is tied up in inventory-a key point for a capital-intensive business.

Working Capital and Inventory Reliance

The difference between the Current Ratio (1.98) and the Quick Ratio (0.92) is substantial, which means inventory is a massive component of their working capital (current assets minus current liabilities). For the trailing twelve months (TTM) ended June 2025, the change in other working capital was reported as $0 million, suggesting stability in the non-inventory components of working capital. Still, the strong Free Cash Flow (FCF) of $464 million in the third quarter of 2025 was largely attributed to favorable working capital changes, indicating management is actively optimizing this area to free up cash. What this estimate hides, however, is the risk if a market slowdown forces them to liquidate that high inventory at a discount.

Cash Flow Statement Trends (Operating, Investing, Financing)

The cash flow statement for 2025 paints a picture of a company investing heavily but also generating significant cash from its core operations. The full-year 2025 FCF guidance is strong, projected to be between $400 million and $550 million. This cash generation is the real strength of the balance sheet, as cash flow is what ultimately pays the bills, not just accounting ratios.

The Q1 2025 operating cash flow was negative at $(394.9) million, which is not unusual for a manufacturing company's first quarter as they build inventory for the year. But, the Investing Cash Flow shows disciplined capital allocation, with Q1 CapEx down significantly year-over-year. The Financing Cash Flow is a net outflow, which is healthy, as the company is using cash to pay a dividend of $0.51 per share and buy back stock, like the $91 million in repurchases during Q3 2025. This signals management confidence in future cash generation. For a deeper dive into the company's long-term philosophy, look at their Mission Statement, Vision, & Core Values of Oshkosh Corporation (OSK).

The key takeaway is that while the Quick Ratio suggests an inventory-heavy liquidity profile, the projected FCF of up to $550 million for 2025 provides a huge safety net. The company is generating enough cash to fund its capital spending and still return capital to you, the shareholder.

Valuation Analysis

You're looking at Oshkosh Corporation (OSK) right now and asking the core question: is the market pricing this heavy-duty manufacturer correctly? Based on the latest fiscal year 2025 data, the stock appears to be trading at a slight discount to its historical and industry peers, suggesting it may be undervalued right now, but you need to look closer at the growth trajectory.

The core valuation multiples tell a clear story. Oshkosh Corporation's trailing twelve-month (TTM) Price-to-Earnings (P/E) ratio sits at 12.15 as of mid-November 2025, and its forward P/E is even lower at 10.49. Here's the quick math: this is well below the S&P 500 average, and it suggests investors are paying relatively less for each dollar of Oshkosh Corporation's current and projected earnings. For a capital-intensive business, the Price-to-Book (P/B) ratio of 1.70 is also compelling, sitting just below the industry median of 1.715.

The Enterprise Value-to-EBITDA (EV/EBITDA) ratio, which is a better measure for comparing global industrial companies because it neutralizes debt and taxes, is 7.41. This is an attractive figure, especially when its 10-year median is 8.79. The stock is defintely not expensive on a multiple basis.

• P/E (TTM): 12.15
• P/B: 1.70
• EV/EBITDA: 7.41

Stock Performance and Analyst Sentiment

To be fair, the market has already recognized some of this value. Over the last 52 weeks, Oshkosh Corporation's stock price has climbed by +12.61%. This upward trend saw the stock hit a 52-week high of $144.30 in August 2025, a solid recovery from its 52-week low of $76.82 in April 2025. The recent closing price is around $124.52.

Wall Street analysts are largely bullish, with a consensus rating of Buy or Moderate Buy. The average price target is $145.15, implying a significant upside from the current trading range. Still, the range is wide, with targets spanning from a low of $91 to a high of $188. This spread reflects the uncertainty around the timing of capital expenditure cycles in the Access Equipment segment and the delivery schedule for the Defense segment.

Dividend Health and Payout

For income-focused investors, Oshkosh Corporation offers a modest but very secure dividend. The current annual dividend is $2.04 per share, resulting in a dividend yield of approximately 1.68%. What's important here is the safety of that payment, which is excellent. The earnings payout ratio-the percentage of earnings paid out as dividends-is a low 19.24%. This means Oshkosh Corporation is retaining over 80% of its earnings to reinvest in the business or weather any economic downturns, which is a sign of financial stability and confidence in future growth.

For more detail on who is driving the stock's price and why, check out Exploring Oshkosh Corporation (OSK) Investor Profile: Who's Buying and Why?

Risk Factors

You need to look past Oshkosh Corporation's (OSK) overall resilience-which is defintely there-and focus on where the cracks are showing. The company revised its full-year 2025 guidance downward, a clear signal that near-term market and operational risks are materializing. Specifically, the full-year Net Sales guidance was cut to a range of $10.3 billion to $10.4 billion, down from the prior estimate of $10.6 billion.

Here's the quick math: that lower revenue expectation directly translates to a revised full-year Adjusted Earnings Per Share (EPS) of $10.50 to $11.00, down from the initial $11.00. That's a clear map of risk to financial results.

Market and Economic Headwinds

The biggest external risk right now is the combination of economic uncertainty and trade policy, specifically tariffs. Oshkosh Corporation is seeing a clear softening in its largest segment, Access (aerial work platforms and telehandlers). In Q3 2025, Access segment sales dropped by a significant 18.6% year-over-year to $1.11 billion.

This decline is a direct result of customer caution and delayed equipment purchases, plus higher discounting to move inventory. Plus, the tariff impact is a direct financial hit. Management estimates the full-year cost of tariffs to be between $30 million and $40 million, with the bulk hitting in the fourth quarter. That's a pure margin headwind.

• Tariff costs: $30M to $40M expected for full-year 2025.
• Access segment sales: Down 18.6% in Q3 2025.
• Mitigation: Aggressively pursuing cost levers and planning price increases for 2026.

Operational and Contract Execution Risks

Even with a strong backlog of $13.69 billion at the end of Q3 2025, execution on major contracts carries risk. The ramp-up of the Next Generation Delivery Vehicle (NGDV) production for the U.S. Postal Service (USPS) has faced acknowledged challenges, though the goal remains full-rate production by year-end. Production hurdles always pressure margins and cash flow.

We also saw a one-time financial risk emerge in the Defense segment during Q3 2025: a warranty charge. The CFO clarified this was tied to legacy supply chain disruptions and is not expected to recur, but it highlights the lingering risk from past supply chain volatility.

Strategic and Government Funding Exposure

Oshkosh Corporation's core strength is its exposure to government and infrastructure-driven markets, but this is also its biggest strategic risk. The revenue stream, especially in Defense, is highly susceptible to shifting government priorities, funding levels, and political cycles. A major contract delay or cancellation would hit hard.

However, the company has structured key defense contracts, like the Family of Heavy Tactical Vehicles (FHTV) V, with an Economic Price Adjustment clause. This is crucial, as it protects margins from inflation and cost overruns, which is a significant structural hedge against macroeconomic risks. It buys them visibility on revenue through 2031. For a deeper dive into the company's full financial picture, check out Breaking Down Oshkosh Corporation (OSK) Financial Health: Key Insights for Investors.

Growth Opportunities

You're looking for where Oshkosh Corporation (OSK) can generate real returns, and the story is simple: they are successfully pivoting toward next-generation technology while leaning heavily on their core strength in government and infrastructure-driven markets. For the 2025 fiscal year, the company projects net sales between $10.3 billion and $10.4 billion, with adjusted earnings per share (EPS) expected to land between $10.50 and $11.00.

This near-term outlook, while showing some pressure in the Access and Transport segments, is underpinned by a clear, long-term strategy built on three pillars: Innovate. Serve. Advance. This isn't corporate jargon; it maps directly to their investment in future-proof technology and their robust backlog of government work. Honestly, the biggest growth driver right now is their commitment to electrification and autonomy.

Key Growth Drivers: Electrification and Government Contracts

Oshkosh is making concrete moves to capitalize on major market shifts. Their growth isn't just organic; it's driven by strategic investments in megatrends like electrification and autonomy & active safety. They are putting real money behind this, having allocated $52.4 million for autonomous vehicle technology development and $37.6 million for electric vehicle research and development in 2023 alone. That's a serious commitment.

Product innovations are already emerging, like the HARR-E autonomous refuse robot, which won a CES Picks Award, showing their technological edge. Plus, their strong ties to the U.S. Department of Defense remain a powerful, stable revenue source, evidenced by contracts like the $29.9 million deal to integrate advanced technologies into the ROGUE-Fires system for the U.S. Marine Corps.

• Electrification and autonomy are the future.
• Vocational segment shows strong backlog.
• Infrastructure spending is a tailwind.

Future Projections and Strategic Initiatives

While the 2025 numbers reflect some cyclical headwinds, the long-term guidance is defintely bullish. Management anticipates a significant acceleration in the coming years. They are targeting 2028 revenue between $13 billion and $14 billion, with adjusted EPS soaring to a range of $18.00 to $22.00. That kind of jump requires more than just market recovery; it needs transformative execution.

A key initiative is the strengthening of the Vocational segment, which includes municipal vehicles like fire apparatus and concrete mixers. This segment is poised to benefit from the projected $1.2 trillion in U.S. infrastructure investment by 2025. The company expects the Vocational segment's contribution to adjusted operating income to be on par with the Access segment by 2028, which increases portfolio resilience.

Here's the quick math on their long-term view:

What this estimate hides is the margin expansion they are targeting, moving from a 2025 operating margin to a 12%-14% adjusted operating income margin by 2028. This is a story about both top-line growth and operational efficiency, including the use of autonomous technologies and AI to improve throughput companywide.

Competitive Advantages in a Shifting Market

Oshkosh Corporation's competitive position is rock-solid in its niche markets. They hold a dominant position and market leadership in North American access equipment and specialty vehicles. This isn't a commodity business; their brand is synonymous with the quality and reliability that is critical in defense and construction. They've also been consistently recognized for their corporate reputation, being named to Fortune's World's Most Admired Companies list for 2025, which matters for attracting talent and securing government work.

Their dual focus-specialty commercial vehicles and defense-provides a natural hedge against economic cycles. When commercial construction slows, the Defense segment, with its robust contracts, provides stability. You can read more about their core philosophy here: Mission Statement, Vision, & Core Values of Oshkosh Corporation (OSK).