Key Takeaways Investors must buy the picks-and-shovels and infrastructure stocks winning the AI spending spree. VRT's sales and EPS are soaring as the digital infrastructure firm keeps AI data centers running.Electrical construction and energy infrastructure stock EME is an under-the-radar AI winner. Investors aiming to buy into the artificial intelligence boom driving the economy and Wall Street for the foreseeable future might want to consider best-in-class, AI-boosted infrastructure stocks.
The two Zacks Rank #2 (Buy) stocks we explore today, Vertiv and EMCOR Group, have proven themselves to be big winners in the AI spending spree spanning everything from essential back-end data center technologies to critical energy and electricity infrastructure.
The two picks-and-shovels AI stocks are also rather AI agnostic. This means these proven AI infrastructure stocks will be winners no matter how the technologies evolve or which of the leading frontier models from Anthropic, OpenAI, Google, etc. come to dominate—and if open models continue to gain steam.
Image Source: Zacks Investment Research
VRT and EME shares have crushed the S&P 500 and the Zacks Technology sector over the past five years. Both stocks are projected to post double-digit earnings growth in 2026 and 2027.
Vertiv and EMCOR have pulled back from their peaks and are finding support heading into their second quarter earnings releases. VRT is set to report on Wednesday, July 29, with EME prepared to release its Q2 financials on Thursday, July 30.
Best Long-Term Buy and Hold Stocks: The AI Infrastructure Bull CaseDespite growing talks of an AI bubble, the hyperscalers alone are projected to spend roughly $700 billion or more in AI-related capex in 2026 and ramp up again in 2027, after spending $400 billion in 2025. Some of this money is going directly into the pockets of VRT and EME as they help build out the AI age.
Globally, companies will pour $7 trillion into data-center capex by 2030 (McKinsey), with $1.3 trillion aimed at energy. This backdrop makes sense considering that generative AI like ChatGPT uses 10X more energy than traditional Google searches, and large AI data centers can guzzle as much power as mid-sized cities.
Plus, the U.S. electricity grid was already desperate for investment before the AI boom pushed it to the brink—especially in AI data-center hubs.
AI growth, the reshoring of critical manufacturing such as semiconductors, electrification, and more are set to boost U.S. electricity demand 25% by 2030 and ~100% by 2050.
The explosive growth in AI demand is forcing hyperscalers and enterprises to pour hundreds of billions into power-hungry infrastructure, creating a powerful multi-year tailwind for companies that supply energy, chips, cooling systems, construction services, and more.
VRT: A Great Buy and Hold AI and Tech StockVertiv (VRT - Free Report) is one of the most surefire pick-and-shovels technology-heavy AI infrastructure stocks to buy. The company doubled its revenue between 2021 and 2025 and grew its GAAP EPS from $0.33 per share to $3.41 per share.
The dividend-paying tech stock has soared ~1,050% in the past three years to blow away Nvidia’s 360%. The company’s rapid growth helped it earn a spot in the S&P 500 in March.
Image Source: Zacks Investment Research
The Columbus, Ohio-based company provides critical digital infrastructure technologies that help AI data centers and beyond run as efficiently as possible around the clock.
Cutting-edge AI systems pack so many high-power GPUs into dense racks that traditional air cooling can no longer keep up, making VRT’s advanced liquid cooling portfolio essential to prevent overheating and maintain performance. It’s even working with AI chip powerhouse Nvidia (NVDA - Free Report) to help solve AI cooling challenges.
Image Source: Zacks Investment Research
Vertiv is actively expanding its manufacturing footprint to support “growing customer demand for AI, high-density computing, and other critical digital infrastructure applications.” It is projected to grow its adjusted EPS by 52% in 2026 and 34% in FY27, based on the most recent Zacks estimates, doubling its 2025 total in the process.
The chart above highlights its longer-term earnings upside. VRT is expected to grow its revenue by 34% in 2026 and 28% in 2027 to reach $17.64 billion, doubling 2024’s total.
Image Source: Zacks Investment Research
The proven AI infrastructure company’s upward earnings revisions land it a Zacks Rank #2 (Buy), and it has beaten our Zacks EPS estimates for over three years running. Vertiv outclimbed Nvidia over the past three years, and it's nearly neck and neck with it over the last five, up ~990%.
VRT could be ready for a larger pullback after its ~80% YTD climb, if it fails to hold the technical level highlighted above. But long-term investors should consider buying some shares now and then adding to their positions the next time Vertiv goes on sale because market timing is no easy task.
VRT reports before the market opens on Wednesday, July 29.
Buy this Under-the-Radar Picks-and-Shovels AI Stock NowElectrical construction and energy infrastructure stock EMCOR Group, Inc. (EME - Free Report) is profiting directly from the AI data center spending boom and the massive energy and infrastructure growth that's required to support the AI age and thriving growth economies.
Image Source: Zacks Investment Research
EMCOR is a standout provider of mechanical and electrical construction services, industrial and energy infrastructure, and building services. The company boasts that it handles everything from “constructing a hyperscale data center to providing 24/7 support for a cutting-edge hospital to implementing the latest energy efficiency technologies.”
EME’s growth (especially its earnings) skyrocketed over the last five years after rather steady expansion the prior 20 years as it benefits from converging megatrends. The AI data center infrastructure company has a great balance sheet with near-zero debt, and its shareholders’ equity is soaring.
Image Source: Zacks Investment Research
The leading mechanical contractor averaged 13.5% YoY revenue expansion over the last five years, with its GAAP EPS skyrocketing from $7.06 per share in 2021 to $28.19 per share in 2025. EMCOR’s adjusted earnings are projected to climb 14% in 2026 and 12% in 2027, on 12% and 8%, respective sales growth. EME’s upward EPS revisions land it a Zacks Rank #2 (Buy).
EMCOR stock has ripped 520% higher in the past five years as part of a stellar market and sector-crushing run over the last 25 years (up ~6,900%). EME has dropped ~20% from its early May peaks, and its average Zacks price target implies 26% upside from its current level.
EME stock is attempting to find support at its long-term 50-week moving average after holding ground at its 200-day and a key technical range over the last year.
Image Source: Zacks Investment Research
The downturn, mixed with its strong earnings outlook, has EMCOR trading at 24.5X forward 12-month earnings, down significantly from its recent highs of 32X. On the valuation front, EME is trading neck and neck with its highly ranked Building Products - Heavy Construction industry, even though it has doubled that increasingly critical group of companies over the last decade.
EME reports before the market opens on Thursday, July 30.
Emcor Group (EME - Free Report) closed the most recent trading day at $760.27, moving +2.18% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.89%. At the same time, the Dow added 0.74%, and the tech-heavy Nasdaq gained 1.29%.
Coming into today, shares of the construction and maintenance company had lost 14.37% in the past month. In that same time, the Construction sector lost 7.42%, while the S&P 500 lost 0.63%.
The investment community will be closely monitoring the performance of Emcor Group in its forthcoming earnings report. The company is scheduled to release its earnings on July 30, 2026. The company is expected to report EPS of $7.23, up 7.59% from the prior-year quarter. At the same time, our most recent consensus estimate is projecting a revenue of $4.73 billion, reflecting a 9.88% rise from the equivalent quarter last year.
EME's full-year Zacks Consensus Estimates are calling for earnings of $29.37 per share and revenue of $19.02 billion. These results would represent year-over-year changes of +13.53% and +11.97%, respectively.
Investors should also pay attention to any latest changes in analyst estimates for Emcor Group. These latest adjustments often mirror the shifting dynamics of short-term business patterns. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. Currently, Emcor Group is carrying a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that Emcor Group has a Forward P/E ratio of 25.34 right now. Its industry sports an average Forward P/E of 25.08, so one might conclude that Emcor Group is trading at a premium comparatively.
The Building Products - Heavy Construction industry is part of the Construction sector. At present, this industry carries a Zacks Industry Rank of 48, placing it within the top 20% of over 250 industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
Investors in EMCOR Group, Inc. (EME - Free Report) need to pay close attention to the stock based on moves in the options market lately. That is because the July 17, 2026 $360.00 Call had some of the highest implied volatility of all equity options today.
What is Implied Volatility?Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off. However, implied volatility is only one piece of the puzzle when putting together an options trading strategy.
What do the Analysts Think?Clearly, options traders are pricing in a big move for EMCOR shares, but what is the fundamental picture for the company? Currently, EMCOR is a Zacks Rank #1 (Strong Buy) in the Building Products - Heavy Construction industry that ranks in the Top 15% of our Zacks Industry Rank. Over the last 60 days, our Zacks Consensus Estimate for the current quarter has moved from $7.37 per share to $7.44 in that period.
Given the way analysts feel about EMCOR right now, this huge implied volatility could mean there’s a trade developing. Oftentimes, options traders look for options with high levels of implied volatility to sell premium. This is a strategy many seasoned traders use because it captures decay. At expiration, the hope for these traders is that the underlying stock does not move as much as originally expected.
Emcor Group (EME - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.
Over the past month, shares of this construction and maintenance company have returned -10.4%, compared to the Zacks S&P 500 composite's +0.5% change. During this period, the Zacks Building Products - Heavy Construction industry, which Emcor Group falls in, has lost 9.5%. The key question now is: What could be the stock's future direction?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Earnings Estimate RevisionsRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For the current quarter, Emcor Group is expected to post earnings of $7.23 per share, indicating a change of +7.6% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
For the current fiscal year, the consensus earnings estimate of $29.37 points to a change of +13.5% from the prior year. Over the last 30 days, this estimate has remained unchanged.
For the next fiscal year, the consensus earnings estimate of $32.83 indicates a change of +11.8% from what Emcor Group is expected to report a year ago. Over the past month, the estimate has remained unchanged.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Emcor Group is rated Zacks Rank #1 (Strong Buy).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
For Emcor Group, the consensus sales estimate for the current quarter of $4.73 billion indicates a year-over-year change of +9.9%. For the current and next fiscal years, $19.02 billion and $20.5 billion estimates indicate +12% and +7.8% changes, respectively.
Last Reported Results and Surprise HistoryEmcor Group reported revenues of $4.63 billion in the last reported quarter, representing a year-over-year change of +19.7%. EPS of $6.84 for the same period compares with $5.41 a year ago.
Compared to the Zacks Consensus Estimate of $4.22 billion, the reported revenues represent a surprise of +9.7%. The EPS surprise was +16.92%.
Over the last four quarters, Emcor Group surpassed consensus EPS estimates three times. The company topped consensus revenue estimates three times over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Emcor Group is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Emcor Group. However, its Zacks Rank #1 does suggest that it may outperform the broader market in the near term.
In the latest trading session, Emcor Group (EME - Free Report) closed at $750.04, marking a -2.56% move from the previous day. The stock fell short of the S&P 500, which registered a loss of 0.51% for the day. On the other hand, the Dow registered a loss of 0.2%, and the technology-centric Nasdaq decreased by 1.47%.
The stock of construction and maintenance company has fallen by 6.98% in the past month, lagging the Construction sector's loss of 4.14% and the S&P 500's gain of 0.53%.
The investment community will be closely monitoring the performance of Emcor Group in its forthcoming earnings report. The company's earnings per share (EPS) are projected to be $7.23, reflecting a 7.59% increase from the same quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $4.73 billion, indicating a 9.88% growth compared to the corresponding quarter of the prior year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $29.37 per share and a revenue of $19.02 billion, indicating changes of +13.53% and +11.97%, respectively, from the former year.
Investors should also take note of any recent adjustments to analyst estimates for Emcor Group. Recent revisions tend to reflect the latest near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Currently, Emcor Group is carrying a Zacks Rank of #1 (Strong Buy).
In terms of valuation, Emcor Group is currently trading at a Forward P/E ratio of 26.21. This represents no noticeable deviation compared to its industry average Forward P/E of 26.21.
The Building Products - Heavy Construction industry is part of the Construction sector. With its current Zacks Industry Rank of 40, this industry ranks in the top 17% of all industries, numbering over 250.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
Key Takeaways EMCOR is expanding across AI data centers, healthcare, manufacturing and water infrastructure.Record RPOs of $15.62 billion reflect strong demand across multiple high-growth end markets.Network and communications revenues rose nearly 50% in electrical and 86% in mechanical construction. EMCOR Group, Inc. (EME - Free Report) continues to strengthen its position across some of the fastest-growing construction end markets, supported by robust demand for AI data centers, digital infrastructure, healthcare, institutional facilities, manufacturing and water infrastructure.
A key differentiator for EMCOR is its diversified exposure across multiple secular growth markets rather than dependence on a single industry. During the first quarter, the company's construction businesses generated strong growth from network and communications, institutional, manufacturing and industrial, healthcare, water and wastewater, and commercial projects as warehousing, distribution and logistics activity resumed. This broad end-market exposure allows EMCOR to benefit from several long-term infrastructure investment trends.
The AI infrastructure boom remains one of EMCOR's strongest growth drivers. Revenues from the network and communications market increased nearly 50% year over year in the electrical construction segment and 86% in the mechanical construction segment. Increasing cooling requirements and the adoption of advanced liquid-cooling technologies for AI data centers continue to create new opportunities, while the company sees no sign of slowing demand as investments in AI infrastructure, cloud computing and digital transformation accelerate.
Strong demand from healthcare, institutional, manufacturing, water and wastewater, and commercial projects continues to support the business, while institutional activity has remained more resilient than expected. Record remaining performance obligations of $15.62 billion further strengthen revenue visibility. Supported by disciplined project execution, geographic expansion and expanding customer relationships, EMCOR appears well positioned to benefit from multiple long-term construction growth trends.
High-Growth End Markets Intensify Industry CompetitionEMCOR’s expansion across high-growth end markets reflects a broader shift across the specialty construction industry, where contractors are increasing their exposure to data centers, advanced manufacturing and other mission-critical infrastructure. Competitors such as Sterling Infrastructure, Inc. (STRL - Free Report) and Comfort Systems USA, Inc. (FIX - Free Report) are also scaling their capabilities through geographic expansion, integrated service offerings, modular construction and disciplined project selection.
Sterling Infrastructure is strengthening its position in mission-critical construction through rapid growth in data centers, electrical services and semiconductor manufacturing. First-quarter E-Infrastructure revenues surged 174%, while mission-critical projects represented more than 90% of the segment’s signed backlog. STRL also secured the first phase of a semiconductor fabrication campus valued at more than $500 million and is combining site-development and electrical services on large data center projects.
Comfort Systems is also benefiting from sustained technology infrastructure demand. First-quarter revenues increased 56% to $2.9 billion, while the record backlog reached $12.5 billion. Advanced technology, led by data centers, accounted for 56% of revenues and remained the largest contributor to the company’s pipeline. Comfort Systems is investing heavily in modular capacity, targeting 4 million square feet by the end of 2026, while expanding its electrical capabilities through acquisitions. Its nationwide workforce, integrated mechanical and electrical solutions, and growing service opportunity position the company to capture a larger share of long-term data center spending.
EME Stock’s Price Performance & Valuation TrendShares of this Connecticut-based infrastructure service provider have gained 25.8% year to date, slightly underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the Construction sector and the S&P 500 Index.
EME YTD Share Price Performance
Image Source: Zacks Investment Research
EME stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 24.64, as evidenced by the chart below.
EME Valuation
Image Source: Zacks Investment Research
Earnings Estimate Revision of EME Stock
Image Source: Zacks Investment Research
EME’s earnings estimates for 2026 and 2027 have moved upward in the past 60 days. The estimates for 2026 and 2027 imply year-over-year growth of 13.5% and 11.8%, respectively.
EME’s Zacks Rank
EMCOR stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
NORWALK, Conn.--(BUSINESS WIRE)--EMCOR Group, Inc. (NYSE: EME) announced today that it will release its financial results for the second quarter ended June 30, 2026, on Thursday, July 30, 2026, prior to the market open. In conjunction with this release, the Company will host an earnings conference call and webcast reviewing these results and its operations on Thursday, July 30, 2026, at 10:30 am EDT. The call will be hosted by Tony Guzzi, Chairman, President and Chief Executive Officer, Jason N.
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The Trump administration is pressuring foreign memory chipmakers to expand their U.S. footprint, framing memory as a strategic asset for the AI era. According to a Benzinga report, Commerce Secretary Howard Lutnick has publicly pressed Samsung and SK Hynix, saying they will have “no choice but to follow” Micron Technology‘s (NASDAQ:MU | MU Price Prediction) domestic expansion, and adding that “strengthening America’s semiconductor supply chain” outweighs corporate rivalries.
The two Korean giants are reportedly in active expansion talks with Washington and reportedly plan $880 billion of combined investment in the coming years to serve AI memory demand. SK Hynix‘s (NASDAQ:SKHY) U.S.-listed ADR recently began trading on the NASDAQ exchange, signaling the memory supply chain is orienting west.
Tesla (NASDAQ:TSLA) CEO Elon Musk unveiled plans for “Terafab,” a vertically integrated chip mega-facility in Austin, Texas, pursued jointly by Tesla, xAI, and SpaceX (NASDAQ:SPCX). Musk described it as a “large-scale domestic production facility that includes logic, memory, and packaging,” targeting 1 terawatt of annual chip output. Terafab remains a stated vision with no disclosed timeline, but it reinforces the direction of travel.
Three publicly traded companies look positioned to benefit if U.S. memory investment accelerates. Each occupies a distinct point in the fab value chain, from lithography tools to metrology to physical construction.
1. ASML ASML (NASDAQ:ASML) holds a global monopoly on extreme ultraviolet (EUV) lithography, meaning no advanced memory or logic fab can be built without its systems. The company reported Q2 2026 revenue of $10.65 billion, up 21.3% year over year (YoY), with EPS of $8.67 and operating margin of 37.1%.
Management raised FY2026 revenue guidance to $43 billion to $45 billion and outlined plans to add 30% to low-NA EUV capacity for 2027, with a matching expansion planned for DUV immersion systems. ASML CEO Christophe Fouquet cited “ongoing AI-related investments” driving demand for advanced logic and memory chips.
ASML stock is up 64% year to date (YTD) and carries a trailing 12-month P/E ratio of 60x. The valuation is elevated, and the business is more logic and EUV-levered than pure memory. However, any U.S. memory fab wave necessarily pulls through ASML tools.
The risks include export control restrictions and tariff overhang, both flagged by management. A domestically focused U.S. policy could partly offset ASML’s lost China revenue, though not fully.
2. Onto Innovation Onto Innovation (NYSE:ONTO) specializes in process control, metrology, and inspection with heavy exposure to high-bandwidth memory (HBM) and advanced packaging, the exact segments driving AI memory capex. The company’s Q1 2026 revenue hit a record $291.95 million, up 9.5% YoY, with non-GAAP EPS of $1.42.
Onto Innovation’s advanced-nodes business grew 13% quarterly, and management guided Q2 revenue to $320 million to $330 million. A prior volume purchase agreement estimated at over $240 million with a leading HBM manufacturer runs through 2027, and Onto also holds a 27% ownership stake in Rigaku valued at $710 million.
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CEO Mike Plisinski stated that “global AI investment fueling a robust upcycle in semiconductor capital equipment spending” positions Onto’s portfolio across advanced packaging, advanced nodes, and specialty devices to capture high-growth segments.
Onto Innovation stock is up 89% YTD, but ONTO’s trailing 12-month P/E ratio sits near 132x, a rich level that leaves little room for execution slips. The consensus analyst target price is $369.60; Onto Innovation’s valuation and smaller-cap volatility are among the main risks.
3. EMCOR Group EMCOR Group (NYSE:EME) provides the electrical and mechanical construction that physically builds fabs, cleanrooms, data centers, and mission-critical facilities. The company’s Q1 2026 revenue was $4.63 billion, up 19.7% YoY, with EPS of $6.84 and operating margin of 8.7%.
EMCOR’s Remaining Performance Obligations reached a record $15.62 billion, up 32.9% YoY, and management raised FY2026 revenue guidance to $18.5 billion to $19.25 billion. Furthermore, the company’s U.S. Electrical Construction revenue jumped 33.1% and U.S. Mechanical Construction climbed 28.8%.
EMCOR stock is up 23% YTD with a trailing 12-month P/E ratio near 25x, a comparatively modest multiple among the three names. The consensus analyst price target sits at $1,000.14.
The risks are project-based rather than technological: tariffs on materials, skilled labor scarcity, and inflation. EMCOR isn’t a pure semiconductor play, so fab exposure competes with data centers, healthcare, and institutional work in its backlog.
The ETF Angle and Broader Takeaways Investors seeking diversified exposure could consider the VanEck Semiconductor ETF (NASDAQ:SMH), which holds ASML at around 8% of net assets as a top-tier position. The ETF excludes EMCOR entirely, and Onto Innovation falls outside its top ten holdings, so it delivers only partial coverage of the memory-fab construction theme.
The SMH ETF is a concentrated single-sector fund that carries sector-concentration risk. For context on how AI capex is reshaping adjacent industries, our research team’s briefing on 7 Stocks Powering the AI Boom (That Aren’t Chipmakers) explores that theme in depth.
The thesis for ASML, Onto Innovation, and EMCOR rests on a policy push and announced plans whose timelines and outcomes remain uncertain. Investors may want to watch fab groundbreaking announcements, HBM order flow, and further Commerce Department signals for confirmation, and should size their positions modestly given the elevated valuations in the equipment-segment businesses.
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Key Takeaways EMCOR raised 2026 guidance as record RPOs and infrastructure demand support long-term growth.Jacobs posted a record backlog, expanded AI and consulting capabilities, and increased expected PA synergies.EME's 35.19% trailing ROE exceeds Jacobs', reflecting stronger shareholder return efficiency. The demand for mission-critical industrial, government, healthcare and data center projects has ramped up across the United States over the past few years and is currently reaching its peak, given the public funding growth and market trends. Firms like EMCOR Group, Inc. (EME - Free Report) and Jacobs Solutions, Inc. (J - Free Report) sit at the juncture and are currently gaining from these market tailwinds.
EMCOR offers mechanical and electrical construction, industrial and energy infrastructure services for a diverse range of businesses, serving commercial, industrial, utility and institutional clients in the United States. Meanwhile, Jacobs offers professional, technical and construction services to industrial, commercial and governmental clients.
Let’s closely compare the fundamentals of the two infrastructure stocks to determine which one is a better investment now.
The Case for EMCOR StockFederal and state investments in water infrastructure, transportation, healthcare modernization, institutional facilities and energy-related projects are creating a healthy pipeline of opportunities for EMCOR. At the same time, AI-driven data center expansion and broader digital transformation continue to fuel commercial construction demand. Owing to these robust trends, EMCOR’s record remaining performance obligations (RPOs) reached $15.62 billion as of March 31, 2026, up 32.9% year over year and nearly 18% sequentially, providing exceptional visibility into future revenue generation. RPOs in the construction segments highlighted contributions of $8.56 billion in U.S. mechanical construction and $5.61 billion in U.S. electrical construction, with additional contributions from building services.
Management emphasized that it continues to see no signs of slowing demand as customers expand data center capacity and adopt advanced liquid cooling technologies. Reflecting this confidence, EME raised its full-year 2026 revenue guidance to $18.5-$19.25 billion from $17.75-$18.5 billion and increased its EPS guidance to $28.25-$29.75 from $27.25-$29.25 expected earlier. Supported by disciplined project selection, execution capabilities and broad market diversification, the company appears well-positioned to capitalize on multi-year infrastructure investment trends.
Meanwhile, strategic acquisitions remain an important pillar of EMCOR's long-term growth strategy, complementing its strong organic expansion. The company's acquisition of Miller Electric has strengthened its electrical construction capabilities, expanded its geographic presence and increased exposure to attractive end markets. Rather than pursuing scale for its own sake, EMCOR prioritizes disciplined capital deployment and integration, preserving its operational culture while creating cross-selling opportunities across its construction and services platforms.
EME ended the first quarter of 2026 with approximately $916 million in cash and about $1.25 billion in working capital, supporting organic investments, strategic acquisitions and operational needs. Management expects full-year 2026 operating cash flow to remain broadly in line with net income, reflecting the underlying strength of the business despite quarterly working-capital fluctuations.
The Case for Jacobs StockJacobs continues to benefit from long-term structural demand across data centers, semiconductors, water infrastructure, transportation and energy & power, reporting more than 100% year-over-year growth in its data center business, supported by accelerating AI investments and strong hyperscaler demand. PA Consulting acquisition is further enhancing growth through advisory, digital transformation and national security opportunities, creating meaningful cross-selling potential. Management has already increased expected annual cost synergies from the acquisition to more than $20 million within 24 months.
These demand drivers helped Jacobs deliver a record backlog of $27 billion, up 22% year over year, with a strong trailing 12-month book-to-bill ratio of 1.4x, providing excellent revenue visibility and supporting confidence in sustained long-term growth. The company is executing a strategy focused on expanding higher-margin consulting, digital and lifecycle solutions while strengthening its leadership in resilient infrastructure markets. Jacobs continues to invest in AI-enabled engineering solutions, including digital twins developed with NVIDIA Omniverse, reinforcing its competitive positioning in rapidly expanding AI infrastructure, advanced manufacturing and mission-critical facilities.
Besides, Jacobs continues to strengthen its global footprint through expanding operations across North America, Europe and the United Kingdom. Recent project wins with Ofwat, Scottish Hydro Electric Transmission and global hyperscale data center customers further demonstrate growing international opportunities. With diversified end markets, strong bookings, improving margins and an upgraded fiscal 2026 outlook, Jacobs appears well-positioned to capture expanding global infrastructure and digital transformation spending, even though execution risks and macroeconomic uncertainties pose a near-term threat.
Notably, Jacobs maintains a balanced capital allocation strategy that simultaneously funds long-term growth while delivering substantial shareholder returns. It repurchased $472 million of shares during the first half of fiscal 2026 and increased its quarterly dividend by 12.5%, reflecting confidence in future cash generation.
Stock Performance & ValuationAs witnessed from the chart below, in the past six months, EMCOR’s share price performance has been above Jacobs’ and the broader Construction sector.
Image Source: Zacks Investment Research
Considering valuation, over the last five years, EMCOR has been trading above Jacobs on a forward 12-month price-to-earnings (P/E) ratio basis.
Image Source: Zacks Investment Research
Overall, from these technical indicators, it can be deduced that EME stock offers an increasing growth trend but with a premium valuation, while J stock offers a declining growth trend with a discounted valuation.
Comparing EPS Estimate Trends: EME vs. JThe Zacks Consensus Estimate for EME’s 2026 and 2027 earnings has moved upward in the past 60 days. The revised estimates for 2026 and 2027 imply year-over-year growth of 13.5% and 11.8%, respectively.
EME's EPS Trend
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for J’s fiscal 2026 earnings has increased in the past 30 days, while the same for fiscal 2027 has edged down during the same time frame. The revised estimates for fiscal 2026 and fiscal 2027 imply year-over-year growth of 18.1% and 14.5%, respectively.
J's EPS Trend
Image Source: Zacks Investment Research
Return on Equity (ROE) of EME & J StocksEMCOR’s trailing 12-month ROE of 35.19% significantly exceeds Jacobs’ average, underscoring its efficiency in generating shareholder returns.
Image Source: Zacks Investment Research
Investment Decision: Should Investors Choose EME Stock or J Stock?EMCOR combines record remaining performance obligations, raised 2026 revenue and earnings guidance, disciplined acquisitions and broad exposure across mechanical, electrical, healthcare, institutional and industrial construction, providing exceptional earnings visibility. Its superior execution and industry-leading 35.2% ROE further strengthen the investment case. Although the stock trades at a premium, its recent price momentum, upward earnings estimate revisions and improving fundamentals justify the higher valuation.
Jacobs remains an attractive long-term infrastructure play, supported by record backlog, rapid data center growth, AI-enabled engineering capabilities and expanding consulting opportunities through PA Consulting. However, mixed earnings estimate revisions, greater exposure to consulting execution and slower share price momentum make its near-term outlook comparatively less compelling.
With a current Zacks Rank #1 (Strong Buy) compared with J stock’s Zacks Rank #2 (Buy), stronger technical indicators and more consistent operational momentum, EME stock stands out as the better investment choice for investors looking to capitalize on the current infrastructure and AI-driven construction cycle. You can see the complete list of today’s Zacks #1 Rank stocks here.
As infrastructure demands shift toward high-tech facilities and energy transition, choosing between EMCOR Group (EME +1.88%) and Fluor (FLR +1.41%) requires looking at how these engineering giants manage their project backlogs.
Both companies provide essential services to industrial and government clients, yet they operate at different scales of project complexity. While one specializes in electrical and mechanical systems for high-tech facilities, the other manages massive global infrastructure projects. Investors often compare them to see which management team handles cyclical swings better.
The case for EMCOREMCOR Group operates as a specialty construction firm and is frequently grouped among construction stocks due to its focus on mechanical and electrical systems. It serves high-growth areas like data centers, healthcare, and semiconductor manufacturing. Because no single customer represents more than 10% of revenue, the company maintains a highly diversified client base across many industries.
In FY 2025, revenue reached nearly $17.0 billion, which represents a 16.6% increase compared to the prior year. The company reported net income of approximately $1.3 billion for the same period. This upward trend in both sales and net income reflects steady demand in its core segments.
As of its December 2025 balance sheet, the debt-to-equity ratio is roughly 0.2x, which measures total debt against shareholder equity. The current ratio, comparing short-term assets to liabilities, is roughly 1.2x. Free cash flow for fiscal year 2025 was nearly $1.2 billion, representing the cash leftover after paying for operations and equipment.
The case for FluorFluor provides engineering, procurement, and construction services for global energy and urban infrastructure. It focuses heavily on reimbursable contracts where clients cover costs plus a fee to reduce financial uncertainty. U.S. government agencies are significant clients, accounting for roughly 17% of total revenue in 2025, and customer concentration like this adds a layer of risk to the business.
In FY 2025, revenue was close to $15.5 billion, representing a decline of roughly 5.0% from the previous year. The company reported a net loss of approximately $51.0 million during this period. While revenue dipped, Fluor continues to manage a massive backlog of long-term projects across several continents.
On its December 2025 balance sheet, the debt-to-equity ratio is approximately 0.3x. The current ratio is roughly 1.9x, indicating the company has $1.90 in short-term assets for every $1.00 in current debts. Free cash flow was negative during fiscal year 2025, totaling roughly -$437.0 million, which shows the company spent more than it generated from operations.
Risk profile comparisonEMCOR faces risks related to the cyclical nature of the non-residential construction market, particularly in the energy and data center sectors where spending can fluctuate. Because it uses fixed-price contracts, any unexpected inflation or supply chain delays can lead to cost overruns that the company must absorb without reimbursement. Furthermore, about 62% of its workforce is unionized, which exposes the company to potential work stoppages or material pension fund liabilities.
Fluor deals with significant legal exposure, including a recently revived lawsuit regarding a suicide bombing in Afghanistan and disputes over the LOGCAP government contract. Managing complex, high-value projects internationally also exposes the firm to political instability, trade sanctions, and regulatory changes in diverse global locations. Although it recently exited its position in NuScale Power, the company still faces execution risks where unforeseen delays could result in significant financial losses.
Valuation comparisonFluor appears to be the more value-oriented option based on its lower Forward P/E, which compares stock price to future earnings estimates, and its lower P/S ratio, which measures price against total revenue.
MetricEMCORFluorSector BenchmarkForward P/E26.7x19.5x242.8xP/S ratio2.1x0.5xSector benchmark uses the SPDR XLI sector ETF.
Valuation metrics sourced from Financial Modeling Prep (FMP) and may differ from other data providers.
Both companies carry impressive backlogs, but the stories behind those numbers look very different right now. I'd go with EMCOR.
EMCOR is firing on all cylinders. Revenue is growing at a double-digit rate and earnings are beating expectations by a wide margin. Its backlog just hit a record. The company is benefiting from a wave of data center construction, AI infrastructure build-out, and institutional demand that shows no sign of slowing. Management keeps raising guidance, and the balance sheet is in strong shape.
Fluor has a larger backlog in absolute terms, but its most recent quarter told a more complicated story. Revenue fell year over year and earnings missed estimates by a wide margin. And the company trimmed its profitability outlook after a litigation charge and cost overruns on a mining project. The long-term pipeline is encouraging, but executing on it is proving harder than the backlog size suggests.
A backlog only matters if you can execute on it, and right now I like how EMCOR is proving it can.
Emcor Group (EME - Free Report) closed at $783.41 in the latest trading session, marking a +1.88% move from the prior day. This change outpaced the S&P 500's 0.81% gain on the day. Elsewhere, the Dow saw an upswing of 0.27%, while the tech-heavy Nasdaq appreciated by 1.3%.
Shares of the construction and maintenance company witnessed a loss of 1% over the previous month, beating the performance of the Construction sector with its loss of 1.38%, and underperforming the S&P 500's gain of 1.13%.
The investment community will be paying close attention to the earnings performance of Emcor Group in its upcoming release. In that report, analysts expect Emcor Group to post earnings of $7.23 per share. This would mark year-over-year growth of 7.59%. Our most recent consensus estimate is calling for quarterly revenue of $4.73 billion, up 9.88% from the year-ago period.
EME's full-year Zacks Consensus Estimates are calling for earnings of $29.37 per share and revenue of $19.02 billion. These results would represent year-over-year changes of +13.53% and +11.97%, respectively.
It's also important for investors to be aware of any recent modifications to analyst estimates for Emcor Group. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Emcor Group is holding a Zacks Rank of #1 (Strong Buy) right now.
Investors should also note Emcor Group's current valuation metrics, including its Forward P/E ratio of 26.19. For comparison, its industry has an average Forward P/E of 26.09, which means Emcor Group is trading at a premium to the group.
The Building Products - Heavy Construction industry is part of the Construction sector. With its current Zacks Industry Rank of 45, this industry ranks in the top 19% of all industries, numbering over 250.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
Key Takeaways EMCOR expects to keep growing faster than nonresidential construction, led by data center gains.EMCOR lifted 2026 revenue guidance to $18.5B-$19.25B after record Q1 sales of $4.63B.EMCOR is seeing demand across institutional, healthcare, manufacturing, water and logistics projects. EMCOR Group, Inc. (EME - Free Report) appears well positioned to outperform the broader U.S. nonresidential construction market again in 2026, supported by strong demand across multiple end markets, a record project backlog and continued share gains in mission-critical infrastructure. While industry growth is expected to remain moderate, the company continues to benefit from exposure to structural growth markets such as data centers, healthcare, institutional facilities, water infrastructure and advanced manufacturing.
Management remains confident that the company will continue growing meaningfully faster than the broader nonresidential construction market. During the first-quarter earnings call, EMCOR stated that it expects to "continue to grow in excess of nonresidential construction" while expanding its presence across existing and adjacent geographies, particularly within the data center market.
The company has already demonstrated that momentum. First-quarter 2026 revenues increased 19.7% year over year to a record $4.63 billion, or 16.8% on an organic basis. Strong execution prompted management to raise its full-year 2026 revenue guidance to $18.5-$19.25 billion from the prior range of $17.75-$18.5 billion, while also increasing its diluted EPS outlook. Importantly, management indicated that growth is extending beyond data centers.
One reason EMCOR appears capable of sustaining above-market growth is the breadth of its end-market exposure. Rather than relying on a single growth engine, the company continues to benefit from multiple construction verticals. Network and communications, which includes data centers, remains the largest contributor to growth as artificial intelligence (AI), cloud computing and digital infrastructure investments continue to accelerate. At the same time, EMCOR is experiencing strong activity in institutional construction, manufacturing and industrial facilities, healthcare projects and water and wastewater infrastructure. Mechanical construction also benefited from the recovery in warehousing, distribution and logistics projects during the quarter.
Although macroeconomic uncertainty, labor availability and project timing remain industry risks, EMCOR's diversified project portfolio, expanding backlog and exposure to long-term infrastructure investment appear to position the company to continue outperforming broader nonresidential construction trends. If demand across data centers, institutional facilities, healthcare and water infrastructure remains healthy, EMCOR could again deliver growth that exceeds the overall nonresidential construction market in 2026.
Peers Also Positioned to Outgrow the MarketEMCOR is not the only contractor benefiting from resilient demand across high-growth nonresidential construction markets. Industry peers Sterling Infrastructure, Inc. (STRL - Free Report) and Comfort Systems USA, Inc. (FIX - Free Report) are also capitalizing on sustained investment in mission-critical facilities, advanced manufacturing and data center infrastructure, positioning themselves to outpace broader construction industry growth.
Sterling continues to benefit from robust demand in its E-Infrastructure business, where data centers remain the primary growth driver. The company reported that mission-critical projects, including data centers, semiconductor facilities and advanced manufacturing, accounted for more than 90% of its E-Infrastructure signed backlog. Sterling also highlighted expanding opportunities across new geographies, growing cross-selling between its site development and electrical businesses, and increasing project size and complexity — all of which are expected to support above-market growth over the long term.
Comfort Systems is similarly benefiting from structural demand across technology and institutional markets. Management noted that advanced technology, led primarily by data center projects, accounted for 56% of first-quarter revenues and remained the company's largest driver of pipeline and backlog growth. At the same time, healthcare, education and government projects continued to provide a solid base of institutional demand, while ongoing investments in modular manufacturing capacity are expected to support future expansion and execution.
EME Stock’s Price Performance & Valuation TrendShares of this Connecticut-based infrastructure service provider have gained 25.7% year to date, slightly underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
EME stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 24.67, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EME StockEME’s earnings estimates for 2026 and 2027 have moved upward in the past 60 days. The estimates for 2026 and 2027 imply year-over-year growth of 13.5% and 11.8%, respectively.
Image Source: Zacks Investment Research
EMCOR stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Emcor Group (EME - Free Report) closed the most recent trading day at $787.29, moving +1.63% from the previous trading session. This change outpaced the S&P 500's 0.72% gain on the day. Elsewhere, the Dow saw an upswing of 0.3%, while the tech-heavy Nasdaq appreciated by 1.12%.
Prior to today's trading, shares of the construction and maintenance company had lost 5.23% lagged the Construction sector's gain of 0.11% and the S&P 500's loss of 0.9%.
Market participants will be closely following the financial results of Emcor Group in its upcoming release. The company is expected to report EPS of $7.23, up 7.59% from the prior-year quarter. At the same time, our most recent consensus estimate is projecting a revenue of $4.73 billion, reflecting a 9.88% rise from the equivalent quarter last year.
For the full year, the Zacks Consensus Estimates project earnings of $29.37 per share and a revenue of $19.02 billion, demonstrating changes of +13.53% and +11.97%, respectively, from the preceding year.
Any recent changes to analyst estimates for Emcor Group should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. Emcor Group is holding a Zacks Rank of #2 (Buy) right now.
In terms of valuation, Emcor Group is presently being traded at a Forward P/E ratio of 26.38. This indicates no noticeable deviation in contrast to its industry's Forward P/E of 26.38.
The Building Products - Heavy Construction industry is part of the Construction sector. At present, this industry carries a Zacks Industry Rank of 44, placing it within the top 18% of over 250 industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
Emcor Group (EME - Free Report) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.
Shares of this construction and maintenance company have returned -5.2% over the past month versus the Zacks S&P 500 composite's -0.9% change. The Zacks Building Products - Heavy Construction industry, to which Emcor Group belongs, has lost 5.5% over this period. Now the key question is: Where could the stock be headed in the near term?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Earnings Estimate RevisionsHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
Emcor Group is expected to post earnings of $7.23 per share for the current quarter, representing a year-over-year change of +7.6%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
For the current fiscal year, the consensus earnings estimate of $29.37 points to a change of +13.5% from the prior year. Over the last 30 days, this estimate has remained unchanged.
For the next fiscal year, the consensus earnings estimate of $32.83 indicates a change of +11.8% from what Emcor Group is expected to report a year ago. Over the past month, the estimate has remained unchanged.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Emcor Group.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.
For Emcor Group, the consensus sales estimate for the current quarter of $4.73 billion indicates a year-over-year change of +9.9%. For the current and next fiscal years, $19.02 billion and $20.5 billion estimates indicate +12% and +7.8% changes, respectively.
Last Reported Results and Surprise HistoryEmcor Group reported revenues of $4.63 billion in the last reported quarter, representing a year-over-year change of +19.7%. EPS of $6.84 for the same period compares with $5.41 a year ago.
Compared to the Zacks Consensus Estimate of $4.22 billion, the reported revenues represent a surprise of +9.7%. The EPS surprise was +16.92%.
Over the last four quarters, Emcor Group surpassed consensus EPS estimates three times. The company topped consensus revenue estimates three times over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Emcor Group is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Emcor Group. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
Key Takeaways EMCOR's electrical construction revenues rose 33.1% to a record $1.45B in first-quarter 2026.Network and communications revenues surged nearly 50% on AI infrastructure and data-center demand.EMCOR's remaining performance obligations reached a record $15.62B on strong market bookings. EMCOR Group's (EME - Free Report) electrical construction business continues to build strong momentum, supported by robust demand for mission-critical infrastructure and the company's ability to execute complex projects at scale. In the first quarter of 2026, the segment delivered record revenues of $1.45 billion, up 33.1% year over year, while maintaining an industry-leading operating margin of 12.1%. Although margins eased slightly due to acquisition-related amortization, profitability remained strong, highlighting the resilience of EMCOR's operating model.
The biggest growth driver remains network and communications, where revenues surged nearly 50% as hyperscalers and enterprises accelerated investments in AI infrastructure and data centers. Beyond this, EMCOR benefited from healthy demand across institutional projects, hospitality and entertainment, including stadium construction, as well as higher volumes of short-duration projects and service work. This broad-based demand reduces reliance on any single end market and supports sustainable long-term growth.
Looking ahead, management expects the momentum to continue. Remaining performance obligations climbed to a record $15.62 billion, driven by strong bookings across data centers, healthcare, institutional, water and wastewater and manufacturing markets. The company also continues expanding its geographic footprint while leveraging prefabrication, virtual design, workforce training and disciplined contract management to improve execution on increasingly complex projects.
With AI-driven data center construction showing no signs of slowing and diversified demand across multiple infrastructure markets, EMCOR's electrical construction segment appears well-positioned to remain a key contributor to the company's growth throughout 2026 and beyond.
How Do EMCOR's Peers Compare in Electrical Construction?Two of EMCOR's closest competitors in electrical and mechanical contracting are Quanta Services (PWR - Free Report) and Comfort Systems USA (FIX - Free Report) . Both companies are benefiting from the same secular drivers, including AI data center construction, grid modernization and expanding infrastructure investment.
Quanta continues to strengthen its electrical construction business through large-scale transmission, substation and renewable energy projects, while also increasing its exposure to data centers and communications infrastructure. Quanta has leveraged its engineering expertise and nationwide workforce to secure long-duration projects, giving it strong revenue visibility. As AI-related power demand rises, Quanta is expected to remain a key beneficiary of utility and hyperscaler spending.
Comfort Systems is also expanding its presence in mission-critical facilities through electrical, mechanical and building automation services. Comfort Systems has steadily increased its exposure to data centers, semiconductor manufacturing and advanced industrial facilities, supported by strategic acquisitions. Comfort Systems further benefits from higher-margin service work and prefabrication capabilities that improve execution and profitability.
While both Quanta and Comfort Systems are well-positioned, EMCOR's diversified project portfolio, disciplined contract management and broad geographic reach provide it with a strong competitive position in the rapidly growing electrical construction market.
EME’s Price Performance, Valuation & EstimatesShares of EMCOR have gained 26.6% year to date (YTD), underperforming the Zacks Building Products - Heavy Construction industry, as shown below.
EME YTD Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, EME stock trades at a forward 12-month price-to-earnings ratio of 24.9, below the industry’s average.
EME Valuation - P/E (F12M)
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for EME’s 2026 sales and earnings implies year-over-year growth of 12% and 13.5%, respectively. Earnings per share estimates for 2026 have increased to $29.37 in the past 30 days, as shown below.
Image Source: Zacks Investment Research
EMCOR currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Key Takeaways EMCOR raised 2026 revenue and EPS guidance amid strong demand across infrastructure end markets.EME ended Q1 2026 with record remaining performance obligations of $15.62B, up 32.9% year over year.EME continues investing through selective acquisitions while supporting growth with a strong balance sheet. EMCOR Group, Inc. (EME - Free Report) is currently trading below the Zacks Building Products - Heavy Construction industry, with a forward 12-month price-to-earnings (P/E) ratio of 25.86, but above the broader Zacks Construction sector. The industry’s average currently is 26.35, while the sector’s valuation is 21.59.
Image Source: Zacks Investment Research
This Connecticut-based infrastructure service provider continues to trade below its industry, despite what its durable earnings growth, execution capabilities and cash-generation profile suggest. This reflects that the market may not be fully pricing in EMCOR's multi-year growth runway and resilient business model. Currently, the company is benefiting from powerful secular growth drivers, including AI-driven data center construction, cloud infrastructure expansion, public infrastructure modernization, healthcare upgrades, water and wastewater investments, and advanced manufacturing projects.
Moreover, these trends have fueled record growth in backlog and prompted management to raise its 2026 revenue and earnings guidance, supporting strong long-term visibility. Although margin pressures from large contracts, acquisition integration risks, macroeconomic pressures and uncertainties in federal infrastructure spending are looming over EME, the ongoing growth-supporting aspects are more than likely to beat the odds in the upcoming term.
In the past six months, EME stock has gained 23.1%, underperforming the industry but outperforming the sector and the S&P 500 Index, as evidenced by the chart below.
Image Source: Zacks Investment Research
Let’s decode the factors backing EMCOR stock’s growth prospects in the upcoming terms.
Favorable Infrastructure Trends & Long-Term GrowthEMCOR continues to benefit from favorable macroeconomic and structural trends that are driving demand across public and private infrastructure markets. Federal and state investments in water infrastructure, transportation, healthcare modernization, institutional facilities and energy-related projects are creating a healthy pipeline of opportunities. At the same time, AI-driven data center expansion and broader digital transformation continue to fuel commercial construction demand.
Management noted sustained momentum across several key end markets with no meaningful slowdown in customer spending, particularly in mission-critical projects. Reflecting this confidence, EMCOR raised its full-year 2026 revenue guidance to $18.5-$19.25 billion from $17.75-$18.5 billion and increased its EPS guidance to $28.25-$29.75 from $27.25-$29.25 expected earlier. Supported by disciplined project selection, execution capabilities and broad market diversification, the company appears well-positioned to capitalize on multi-year infrastructure investment trends.
Record Backlog & Data Center InvestmentsEMCOR's record remaining performance obligations (RPOs) of $15.62 billion as of March 31, 2026, were up 32.9% year over year and nearly 18% sequentially, providing exceptional visibility into future revenue generation. RPOs in the construction segments highlighted contributions of $8.56 billion in U.S. mechanical construction and $5.61 billion in U.S. electrical construction, with additional contributions from building services. Backlog growth was broad-based, with notable gains in network and communications, healthcare, institutional, and water and wastewater markets. The network and communications segment remains a standout growth engine, supported by unprecedented investments in AI infrastructure, cloud computing and digital transformation.
Management emphasized that it continues to see no signs of slowing demand as customers expand data center capacity and adopt advanced liquid cooling technologies. EMCOR is also broadening its geographic footprint and service offerings to capture additional opportunities. Combined with diversified end markets, the record backlog strengthens confidence in sustained revenue growth over the coming years.
Disciplined Acquisition StrategyStrategic acquisitions remain an important pillar of EMCOR's long-term growth strategy, complementing its strong organic expansion. The company's acquisition of Miller Electric has strengthened its electrical construction capabilities, expanded its geographic presence and increased exposure to attractive end markets such as data centers and advanced manufacturing. Management continues to pursue acquisitions selectively, focusing on businesses that enhance technical expertise, broaden customer relationships and fit EMCOR's decentralized operating model. Rather than pursuing scale for its own sake, EMCOR prioritizes disciplined capital deployment and integration, preserving its operational culture while creating cross-selling opportunities across its construction and services platforms. This measured acquisition strategy enables the company to strengthen competitive positioning, diversify revenue streams and support sustainable earnings growth without materially compromising profitability or financial flexibility.
Strong Balance Sheet & Shareholder ApproachEMCOR maintains one of the strongest balance sheets in the engineering and construction industry, providing ample financial flexibility to fund growth initiatives while rewarding shareholders. The company ended the first quarter of 2026 with approximately $916 million in cash and about $1.25 billion in working capital, supporting organic investments, strategic acquisitions and operational needs. Management expects full-year 2026 operating cash flow to remain broadly in line with net income, reflecting the underlying strength of the business despite quarterly working-capital fluctuations.
EME complements its financial strength with a balanced capital allocation strategy that combines disciplined acquisitions with consistent shareholder returns through dividends and share repurchases. This long-term approach has supported years of value creation while preserving the flexibility to invest in future growth opportunities as market conditions evolve.
EMCOR’s ROE PositionEMCOR’s superior return on equity (ROE) indicates its growth potential. It provides solid investment returns relative to the industry average, as reflected in its current trailing 12-month ROE of 35.19%. This compares favorably with the industry's ROE of 22.65%. The factor mentioned above indicates the company’s efficiency in using its shareholders’ funds, along with its ability to generate profit with minimum capital usage.
Image Source: Zacks Investment Research
EME vs Peers: Who Wins the Infrastructure Race?EMCOR, alongside Comfort Systems USA, Inc. (FIX - Free Report) , Quanta Services, Inc. (PWR - Free Report) and MasTec, Inc. (MTZ - Free Report) , continues to benefit from powerful infrastructure spending trends, but EME appears particularly well-positioned due to its diversified exposure across data centers, healthcare, institutional, water and wastewater, manufacturing and building services.
While Comfort Systems is also capitalizing on AI-driven data center demand, its operations are more concentrated in mechanical contracting. Meanwhile, Quanta enjoys strong utility and power transmission tailwinds, whereas MasTec remains more exposed to energy, communications and large infrastructure projects that can be more cyclical. Although Quanta, Comfort Systems and MasTec each possess attractive long-term opportunities, EME’s broader end-market diversification, operational discipline and balanced capital allocation provide a competitive edge, positioning it to deliver more resilient earnings growth across varying economic cycles.
Earnings Estimate Revision of EMEEME’s earnings estimates for 2026 and 2027 have moved upward in the past 30 days to $29.37 per share and $32.83 per share, respectively. The revised estimates for 2026 and 2027 imply year-over-year growth of 13.5% and 11.8%, respectively.
Image Source: Zacks Investment Research
Should Investors Dive Into EMCOR Stock Now?EMCOR presents a compelling investment opportunity for investors seeking exposure to long-term U.S. infrastructure spending. The benefits from strong secular tailwinds, including AI-driven data center construction, healthcare modernization, water infrastructure upgrades and advanced manufacturing investments, are encouraging. Besides, EME’s disciplined acquisition strategy, robust balance sheet, healthy cash generation and shareholder-friendly capital allocation further reinforce its long-term growth profile. Additionally, its diversified end-market exposure reduces dependence on any single sector, enhancing earnings resilience across economic cycles.
While macroeconomic uncertainty, margin pressures on large projects and acquisition integration remain risks, EME stock’s forward P/E multiple below the industry average suggests its long-term growth potential is not fully reflected in its valuation.
Analysts’ optimism regarding EME stock is reflected in seven of eleven recommendations, pointing to a "Strong Buy”, representing 63.6% of all recommendations.
Image Source: Zacks Investment Research
Thus, backed by a Zacks Rank #1 (Strong Buy), EMCOR stock appears attractively positioned, making the stock worth buying at current levels rather than waiting for a better entry opportunity. You can see the complete list of today’s Zacks #1 Rank stocks here.
Emcor Group (EME - Free Report) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #1 (Strong Buy). An upward trend in earnings estimates -- one of the most powerful forces impacting stock prices -- has triggered this rating change.
The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system.
Individual investors often find it hard to make decisions based on rating upgrades by Wall Street analysts, since these are mostly driven by subjective factors that are hard to see and measure in real time. In these situations, the Zacks rating system comes in handy because of the power of a changing earnings picture in determining near-term stock price movements.
Therefore, the Zacks rating upgrade for Emcor Group basically reflects positivity about its earnings outlook that could translate into buying pressure and an increase in its stock price.
Most Powerful Force Impacting Stock PricesThe change in a company's future earnings potential, as reflected in earnings estimate revisions, and the near-term price movement of its stock are proven to be strongly correlated. That's partly because of the influence of institutional investors that use earnings and earnings estimates for calculating the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their bulk investment action then leads to price movement for the stock.
Fundamentally speaking, rising earnings estimates and the consequent rating upgrade for Emcor Group imply an improvement in the company's underlying business. Investors should show their appreciation for this improving business trend by pushing the stock higher.
Harnessing the Power of Earnings Estimate RevisionsEmpirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, so it could be truly rewarding if such revisions are tracked for making an investment decision. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.
The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>> .
Earnings Estimate Revisions for Emcor GroupFor the fiscal year ending December 2026, this construction and maintenance company is expected to earn $29.37 per share, which is unchanged compared with the year-ago reported number.
Analysts have been steadily raising their estimates for Emcor Group. Over the past three months, the Zacks Consensus Estimate for the company has increased 4%.
Bottom LineUnlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of "buy" and "sell" ratings for its entire universe of more than 4,000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a "Strong Buy" rating and the next 15% get a "Buy" rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.
You can learn more about the Zacks Rank here >>>
The upgrade of Emcor Group to a Zacks Rank #1 positions it in the top 5% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.
NORWALK, Conn.--(BUSINESS WIRE)--EMCOR Group, Inc. (NYSE: EME) today announced that its Board of Directors has declared a regular quarterly cash dividend of $0.40 per common share. The dividend will be paid on July 31, 2026 to stockholders of record as of July 15, 2026. A Fortune 500 company and a member of the S&P 500, EMCOR Group, Inc. is a leader in mechanical and electrical construction services, industrial and energy infrastructure and building services. This press release and other pr.
Emcor Group (EME - Free Report) closed the most recent trading day at $829.88, moving +1.9% from the previous trading session. The stock exceeded the S&P 500, which registered a gain of 0.79% for the day. Elsewhere, the Dow gained 0.26%, while the tech-heavy Nasdaq added 1.52%.
Prior to today's trading, shares of the construction and maintenance company had lost 1.99% lagged the Construction sector's gain of 5.5% and the S&P 500's loss of 1.82%.
The investment community will be closely monitoring the performance of Emcor Group in its forthcoming earnings report. The company is predicted to post an EPS of $7.23, indicating a 7.59% growth compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $4.73 billion, showing a 9.88% escalation compared to the year-ago quarter.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $29.37 per share and revenue of $19.02 billion. These totals would mark changes of +13.53% and +11.97%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for Emcor Group. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 1.3% increase. At present, Emcor Group boasts a Zacks Rank of #2 (Buy).
With respect to valuation, Emcor Group is currently being traded at a Forward P/E ratio of 27.73. This indicates no noticeable deviation in contrast to its industry's Forward P/E of 27.73.
The Building Products - Heavy Construction industry is part of the Construction sector. This industry, currently bearing a Zacks Industry Rank of 62, finds itself in the top 26% echelons of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
Key Takeaways EMCOR is seeing rising institutional demand across universities, healthcare and public-sector projects.EME's record $15.62B RPOs reflect continued customer investment across institutional infrastructure.Institutional projects help diversify EMCOR's end markets and support long-term growth resilience. EMCOR Group, Inc. (EME - Free Report) is benefiting from rising institutional infrastructure investment, an area that is becoming increasingly important within its project portfolio. Demand from universities, healthcare facilities and public-sector projects is providing another avenue of growth while helping diversify the company's exposure beyond traditional commercial and industrial markets.
Institutional activity gained momentum across multiple parts of the business during the first quarter. Revenues from institutional projects more than doubled year over year within the U.S. Mechanical Construction segment, while the U.S. Electrical Construction segment also benefited from higher activity on certain public-sector projects. Demand for upgraded laboratory space at certain colleges and universities, along with continued healthcare facility modernization, supported new project awards.
Institutional and healthcare markets were also among the largest contributors to sequential growth in remaining performance obligations (RPOs). As of March 31, 2026, EMCOR's RPOs reached a record $15.62 billion, reflecting continued customer investment across several end markets, including institutional infrastructure.
Unlike many private construction projects, institutional infrastructure spending is often supported by long-term capital investment priorities rather than short-term economic conditions. The company also indicated that the institutional market has been more resilient than expected over the past several quarters, supported by spending from certain colleges and universities. These trends continue to create opportunities for complex mechanical and electrical construction services, where EMCOR has established expertise.
The increasing contribution from institutional projects also broadens EMCOR's end-market mix. Continued investment in upgraded laboratory space at certain colleges and universities, healthcare facility modernization and certain public-sector projects could support additional project opportunities. If these trends persist, institutional infrastructure could become a more meaningful contributor to EMCOR's long-term growth while strengthening its diversified project portfolio.
EMCOR’s Competitive Standing in Infrastructure MarketsEMCOR operates in a competitive infrastructure and mission-critical construction market alongside companies such as Sterling Infrastructure, Inc. (STRL - Free Report) and Quanta Services, Inc. (PWR - Free Report) .
Sterling has been gaining momentum in large-scale site development and electrical infrastructure projects tied to hyperscale data centers, semiconductor facilities and manufacturing expansion. It continues to benefit from rising project complexity, vertical integration capabilities and growing demand across newer geographies, particularly as Sterling’s customers prioritize speed and execution certainty on mission-critical projects.
Quanta, meanwhile, maintains a strong position in power infrastructure, utility transmission and large-load connectivity markets. The company has been expanding its fabrication, supply-chain and manufacturing capabilities to support growing power demand linked to AI infrastructure, electrification and grid modernization. Quanta’s integrated solutions model and scale across transmission, generation and technology infrastructure markets continue to strengthen its ability to execute large multiyear projects while supporting schedule certainty for customers.
EME Stock’s Price Performance & Valuation TrendShares of this Connecticut-based infrastructure service provider have gained 33.1% in the past six months, underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
EME stock is currently trading at a discount compared with the industry, with a forward 12-month price-to-earnings (P/E) ratio of 26.2, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EMEEME’s earnings estimates for 2026 and 2027 have moved upward in the past 30 days. The estimates for 2026 and 2027 imply year-over-year growth of 13.5% and 11.8%, respectively.
Image Source: Zacks Investment Research
EMCOR currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Key Takeaways EMCOR benefits from strong demand, record RPOs and growth across AI, healthcare and infrastructure markets.Fluor's $2.7B Q1 2026 awards and expanding front-end pipeline support long-term EPC opportunities.EME appears better positioned with stronger momentum, improving EPS estimates and diversified end markets. Growing investment in mission-critical infrastructure, advanced manufacturing, power systems and data center development continues to create attractive opportunities across the engineering and construction industry. Customers are increasingly prioritizing experienced contractors with strong technical expertise, disciplined execution and the ability to deliver large and complex projects from planning through completion. Within this backdrop, EMCOR Group, Inc. (EME - Free Report) and Fluor Corporation (FLR - Free Report) have emerged as two well-positioned companies, supported by healthy project pipelines and sustained demand across several end markets.
EMCOR focuses on mechanical and electrical construction, building services and industrial solutions, leveraging strong field leadership, contract discipline and execution capabilities across diverse end markets. Fluor specializes in engineering, procurement and construction services for large-scale infrastructure, energy, advanced manufacturing and government projects, with an emphasis on early project engagement, quality backlog and disciplined project selection. Both companies are investing in execution capabilities and workforce development while maintaining a selective approach to new opportunities, making them compelling infrastructure stocks to compare.
Let's dive deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.
The Case for EMCOR StockThis Connecticut-based infrastructure service provider continues to benefit from favorable trends across several end markets. Strong demand for healthcare and institutional projects, improving activity in warehousing and logistics facilities, and a growing contribution from higher-margin service work are supporting business momentum. Ongoing investments in workforce development, prefabrication and project execution capabilities are also enhancing the company's ability to capitalize on opportunities across complex construction markets.
Record Remaining Performance Obligations continue to reinforce EMCOR's long-term growth outlook. At the end of the first quarter of 2026, RPOs reached $15.62 billion, up 32.9% year over year and 17.9% sequentially, supported by healthy project awards across AI infrastructure, cloud infrastructure, healthcare, institutional, and water and wastewater markets. The strong project pipeline, together with continued investments in workforce training, virtual design technologies and advanced project planning, strengthens the company's ability to execute large, mission-critical projects over multiple years.
Continued investments in fabrication facilities, workforce expansion and operational capabilities remain necessary to support growth, while customer project timing and the pace of commercial construction activity could create periodic variability across certain end markets. Maintaining disciplined execution will also remain critical as the company pursues increasingly large and complex infrastructure projects.
Healthcare modernization, institutional construction, logistics infrastructure and mission-critical projects continue to provide multiple avenues for long-term growth. Combined with ongoing investments in productivity, execution capabilities and operational excellence, EMCOR remains well positioned to capitalize on favorable construction spending trends across its core end markets.
The Case for Fluor StockThis Texas-based engineering and construction company continues to benefit from growing investment across energy, power, mining, advanced manufacturing and critical infrastructure markets. Expanding demand for LNG, nuclear power, life sciences, data centers and critical minerals is supporting a robust opportunity pipeline, while the company's disciplined approach to project selection and early client engagement strengthens its ability to pursue large, complex engineering, procurement and construction (“EPC”) projects.
Front-end engineering awards and disciplined project selection continue to strengthen Fluor's long-term growth outlook. During the first quarter of 2026, consolidated new awards totaled $2.7 billion, with 98% reimbursable, while backlog rose slightly sequentially to $25.7 billion and remained 82% reimbursable. The company also noted that its prospect pipeline expanded 50% over the past 12 months, with more than $60 billion of front-end work representing potential backlog and an additional $40 billion of opportunities expected over the next three years. This disciplined approach to bidding and contract selection positions Fluor to build a higher-quality backlog while supporting long-term execution.
Commercial negotiations, final investment decisions and geopolitical developments can influence the timing of project awards and the conversion of front-end work into full EPC contracts. The company also remains selective when pursuing data center opportunities, prioritizing favorable commercial terms and disciplined risk allocation over project volume.
Growing investments across power generation, LNG, nuclear energy, mining and advanced technologies continue to expand Fluor's addressable market. Combined with its deep EPC expertise, strong client relationships and increasing pipeline of front-end opportunities, the company remains well positioned to capitalize on long-term infrastructure and energy investment trends.
Stock Performance & ValuationAs witnessed from the chart below, in the past year, EMCOR’s share price performance has stood above that of Fluor and the Zacks Construction sector, as shown in the chart below.
Image Source: Zacks Investment Research
Considering valuation, EMCOR is currently trading at a premium compared with Fluor on a forward 12-month price-to-earnings (P/E) ratio basis.
Image Source: Zacks Investment Research
Comparing EPS Estimate Trends of EME & FLRThe Zacks Consensus Estimate for EMCOR’s 2026 earnings per share has increased to $29.37 in the past 30 days, as shown below. The revised estimates for fiscal 2027 imply year-over-year growth of 13.5%.
EME’s EPS Trend
Image Source: Zacks Investment Research
Fluor’s earnings estimates for 2026 have remained unchanged at $2.65 in the past 30 days. This indicates expected earnings growth of 21% year over year.
FLR’s EPS Trend
Image Source: Zacks Investment Research
EMCOR vs. Fluor: Which Stock Looks Better Positioned?Both companies are well positioned to benefit from long-term investment across infrastructure, advanced manufacturing and mission-critical construction markets. Fluor offers a compelling long-term opportunity pipeline, deep engineering expertise and meaningful exposure to power, LNG, nuclear and other large-scale infrastructure projects, making it an attractive name to watch as project activity expands.
However, EMCOR appears to offer the stronger investment case today. The company combines solid business momentum with improving earnings estimate revisions and a stronger execution profile, while its diversified exposure across healthcare, institutional, industrial and data center-related markets provides multiple avenues for sustained growth.
Although EMCOR trades at a valuation premium to Fluor, that premium appears justified given its stronger operating momentum, favorable estimate revisions and higher Zacks Rank. EMCOR currently carries a Zacks Rank #2 (Buy), while Fluor has a Zacks Rank #4 (Sell). For investors seeking the better combination of execution, earnings visibility and overall investment quality, EMCOR looks like the better buy right now.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Many stocks have benefited from the generative artificial intelligence (AI) revolution, not just the "Magnificent Seven" or tech stocks in general. Companies across many other industries have also benefited greatly from the growth bonanza driven by this revolutionary technology.
A prime example of this is EMCOR Group (EME 7.30%). With a $37.3 billion market cap, EMCOR is a fairly large company, but it is hardly a household name. However, this is about to change. Even as shares have surged, the AI data center build-out boom remains in its early stages. This leaves this industrial stock well-positioned to keep winning, and for more investors to take notice.
Image source: Getty Images.
EMCOR Group at a glance Based in Norwalk, Connecticut, EMCOR Group is a provider of construction, engineering, and property management services. Since its formation in 1994, the company has grown into one of the largest names in the space. EMCOR achieved this scale in large part due to the aggressive acquisition of smaller competitors.
That said, the main driver of growth lately hasn't come from roll-up acquisitions or other financial engineering strategies. Rather, chalk it up to the AI data center boom. Between 2023 and 2025, revenues zoomed from $12.6 billion to nearly $17 billion, thanks to robust demand for electrical, mechanical, and other construction work. During this time frame, earnings more than doubled, from $13.37 to $28.30 per share.
This growth wave has yet to slow down. During Q1 2026, EMCOR reported 19.7% year-over-year revenue growth, with quarterly earnings rising 30%. Alongside strong results, management also issued an upward revision to full-year 2026 guidance, raising its revenue guidance from between $17.8 billion and $18.5 billion to between $18.5 billion and $19.3 billion, with earnings per share (EPS) guidance raised from between $27.25 and $29.25 per share to $28.25 to $29.75 per share.
Better yet, some sell-side analysts anticipate an even stronger 2026 performance. For 2026, the high end of analyst forecasts calls for revenue of $19.2 billion and earnings of over $30 per share.
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Why this AI infrastructure stock has more room to run Even as the market has yet to fully catch on, EMCOR's AI growth has already driven the stock higher. Trading at around $175 per share in mid-2023, the stock now trades at around $845 per share. With this big run-up, EMCOR has also climbed toward a premium valuation.
At current prices, the stock trades for around 28.5 times forward earnings. While reasonable compared to other construction stocks, shares may seem at risk of a de-rating due to slowing earnings growth. However, taking a closer look, don't assume this is imminent.
For instance, consider EMCOR's reported earnings growth last quarter, plus the fact that it beat consensus by $0.94 per share last quarter, the latest forecasts appear too conservative. Comps could prove tough in the coming quarters, but as long as growth merely normalizes rather than screeches to a halt, shares will likely sustain a premium valuation and continue to rise in tandem with earnings growth.
AI data center growth could slow, but EMCOR could still maintain elevated growth. Data center construction and electrical work today translates into maintenance and property management work for EMCOR tomorrow. As high growth continues, and the broad market becomes aware of EMCOR's "AI growth" bona fides, shares could reach even loftier price levels. Given this opportunity, it's prime time to make this AI stock a long-term holding and build a position on any major weakness.
In the latest trading session, Emcor Group (EME - Free Report) closed at $847.17, marking a +1.02% move from the previous day. The stock's change was more than the S&P 500's daily loss of 0.1%. At the same time, the Dow added 0.35%, and the tech-heavy Nasdaq lost 0.43%.
The construction and maintenance company's stock has dropped by 2.65% in the past month, falling short of the Construction sector's gain of 5.84% and the S&P 500's loss of 1.34%.
The investment community will be paying close attention to the earnings performance of Emcor Group in its upcoming release. The company's earnings per share (EPS) are projected to be $7.23, reflecting a 7.59% increase from the same quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $4.7 billion, indicating a 9.08% increase compared to the same quarter of the previous year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $29.37 per share and revenue of $18.83 billion, which would represent changes of +13.53% and +10.86%, respectively, from the prior year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Emcor Group. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.76% higher within the past month. Emcor Group is currently a Zacks Rank #2 (Buy).
Investors should also note Emcor Group's current valuation metrics, including its Forward P/E ratio of 28.56. This signifies a premium in comparison to the average Forward P/E of 21.69 for its industry.
The Building Products - Heavy Construction industry is part of the Construction sector. With its current Zacks Industry Rank of 47, this industry ranks in the top 20% of all industries, numbering over 250.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
Emcor Group (EME - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.
Over the past month, shares of this construction and maintenance company have returned +2.4%, compared to the Zacks S&P 500 composite's +0.1% change. During this period, the Zacks Building Products - Heavy Construction industry, which Emcor Group falls in, has gained 5.6%. The key question now is: What could be the stock's future direction?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Earnings Estimate RevisionsHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For the current quarter, Emcor Group is expected to post earnings of $7.24 per share, indicating a change of +7.7% from the year-ago quarter. The Zacks Consensus Estimate has changed +3.1% over the last 30 days.
The consensus earnings estimate of $29.22 for the current fiscal year indicates a year-over-year change of +13%. This estimate has changed +1.9% over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $32.48 indicates a change of +11.2% from what Emcor Group is expected to report a year ago. Over the past month, the estimate has changed +3.6%.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Emcor Group.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
For Emcor Group, the consensus sales estimate for the current quarter of $4.7 billion indicates a year-over-year change of +9.1%. For the current and next fiscal years, $18.83 billion and $20.29 billion estimates indicate +10.9% and +7.8% changes, respectively.
Last Reported Results and Surprise HistoryEmcor Group reported revenues of $4.63 billion in the last reported quarter, representing a year-over-year change of +19.7%. EPS of $6.84 for the same period compares with $5.41 a year ago.
Compared to the Zacks Consensus Estimate of $4.22 billion, the reported revenues represent a surprise of +9.7%. The EPS surprise was +16.92%.
Over the last four quarters, Emcor Group surpassed consensus EPS estimates three times. The company topped consensus revenue estimates three times over this period.
ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Emcor Group is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Emcor Group. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the "long context," investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.
Even though momentum is a popular stock characteristic, it can be tough to define. Debate surrounding which are the best and worst metrics to focus on is lengthy, but the Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.
Below, we take a look at Emcor Group (EME - Free Report) , which currently has a Momentum Style Score of B. We also discuss some of the main drivers of the Momentum Style Score, like price change and earnings estimate revisions.
It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Emcor Group currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of "A or B" outperform the market over the following one-month period.
You can see the current list of Zacks #1 Rank Stocks here >>>
Set to Beat the Market? In order to see if EME is a promising momentum pick, let's examine some Momentum Style elements to see if this construction and maintenance company holds up.
Looking at a stock's short-term price activity is a great way to gauge if it has momentum, since this can reflect both the current interest in a stock and if buyers or sellers have the upper hand at the moment. It's also helpful to compare a security to its industry; this can show investors the best companies in a particular area.
For EME, shares are up 1.65% over the past week while the Zacks Building Products - Heavy Construction industry is up 2.45% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 2.35% compares favorably with the industry's 5.83% performance as well.
Considering longer term price metrics, like performance over the last three months or year, can be advantageous as well. Shares of Emcor Group have increased 23.93% over the past quarter, and have gained 75.67% in the last year. In comparison, the S&P 500 has only moved 15.12% and 26.7%, respectively.
Investors should also pay attention to EME's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. EME is currently averaging 388,295 shares for the last 20 days.
Earnings OutlookThe Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends remain at the core of Zacks Rank as well. A nice path here can help show promise, and we have recently been seeing that with EME.
Over the past two months, 3 earnings estimates moved higher compared to none lower for the full year. These revisions helped boost EME's consensus estimate, increasing from $28.24 to $29.22 in the past 60 days. Looking at the next fiscal year, 2 estimates have moved upwards while there have been no downward revisions in the same time period.
Bottom LineGiven these factors, it shouldn't be surprising that EME is a #2 (Buy) stock and boasts a Momentum Score of B. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep Emcor Group on your short list.
Key Takeaways EMCOR is targeting electrical construction deals to expand reach and deepen market density.Electrical Construction's revenues rose 33.1% YoY to a record $1.45B in Q1 2026.AI and cloud demand helped lift Network and Communications revenues nearly 50%. EMCOR Group, Inc. (EME - Free Report) appears to be doubling down on electrical construction acquisitions as it seeks to strengthen its competitive position in some of the fastest-growing end markets, particularly data centers and other mission-critical infrastructure projects.
During the company’s first-quarter 2026 earnings call, management identified electrical construction as EMCOR’s primary M&A focus, targeting low- and medium-voltage contractors to expand its geographic reach and strengthen market density. Rather than paying premium valuations for firms with significant data center exposure, EMCOR aims to acquire well-run electrical businesses and leverage its scale, expertise and customer relationships to enter faster-growing infrastructure markets.
This acquisition strategy is amplifying a segment that is already delivering exceptional organic results. In the first quarter of 2026, EMCOR’s Electrical Construction segment generated a record-breaking $1.45 billion in revenues, representing an extraordinary 33.1% increase year over year. Segment operating income climbed 28.2% to a record $174.5 million. Even with rapid scaling and an incremental month of expenses from its major Miller Electric acquisition, the segment maintained a premier operating margin of 12.1%, underscoring the pricing power and execution discipline of EMCOR's decentralized operating model.
EMCOR’s expanding electrical capabilities are becoming increasingly valuable as demand for AI infrastructure accelerates. Electrical construction’s revenues benefited from nearly 50% growth in network and communications, which includes the company’s data center business, driven by continued investment in AI, cloud computing and digital transformation. The strategy is already translating into stronger visibility, with remaining performance obligations reaching a record $15.62 billion, up 32.9% year over year. Network and Communications was a key contributor, while continued wins across electrical and mechanical scopes reinforce EMCOR’s position in mission-critical infrastructure projects.
With robust demand, a growing acquisition pipeline and a disciplined approach to expanding its electrical platform, EMCOR appears focused on widening its competitive moat. If the company can continue integrating acquisitions and converting them into higher-value opportunities, its edge in mission-critical construction markets may continue to strengthen.
EMCOR’s Competitive Position: Electrical Deals in FocusEMCOR has increasingly focused on expanding its electrical construction capabilities, positioning itself to benefit from growing investments in AI infrastructure, cloud computing, electrification and mission-critical facilities. It competes with established infrastructure players such as Sterling Infrastructure, Inc. (STRL - Free Report) and Quanta Services, Inc. (PWR - Free Report) , which are also benefiting from strong demand tied to data centers, electrification and large-scale infrastructure spending.
The strategy comes as electrical capabilities have become a critical competitive advantage across the industry. Sterling recently highlighted the transformational impact of its acquisition of CEC Facilities Group, an electrical contractor that has enabled the company to offer integrated site development and electrical services on large data center projects. Management noted that cross-selling opportunities are materializing faster than expected and that demand for electricians remains exceptionally strong. Sterling also continues to evaluate acquisitions that can expand its electrical footprint and service offerings.
Quanta, meanwhile, has built one of the industry's largest electrical infrastructure platforms through years of acquisitions and organic investments. The company continues to expand its craft workforce, manufacturing capabilities and supply-chain footprint to support rising power and data center demand. Management emphasized that customers increasingly value execution certainty, labor availability and integrated electrical solutions, helping Quanta secure larger negotiated projects and long-term capital programs.
EME Stock’s Price Performance & Valuation TrendShares of this Connecticut-based infrastructure service provider have gained 36.4% year to date, slightly underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
EME stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 27.18, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EME StockEME’s earnings estimates for 2026 and 2027 have moved upward in the past 30 days. The estimates for 2026 and 2027 imply year-over-year growth of 13% and 11.2%, respectively.
Image Source: Zacks Investment Research
EMCOR stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price. Do they really matter, though?
Before we discuss the reliability of brokerage recommendations and how to use them to your advantage, let's see what these Wall Street heavyweights think about Emcor Group (EME - Free Report) .
Emcor Group currently has an average brokerage recommendation (ABR) of 1.73, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 11 brokerage firms. An ABR of 1.73 approximates between Strong Buy and Buy.
Of the 11 recommendations that derive the current ABR, seven are Strong Buy, representing 63.6% of all recommendations.
Brokerage Recommendation Trends for EME
Check price target & stock forecast for Emcor Group here>>>
While the ABR calls for buying Emcor Group, it may not be wise to make an investment decision solely based on this information. Several studies have shown limited to no success of brokerage recommendations in guiding investors to pick stocks with the best price increase potential.
Are you wondering why? The vested interest of brokerage firms in a stock they cover often results in a strong positive bias of their analysts in rating it. Our research shows that for every "Strong Sell" recommendation, brokerage firms assign five "Strong Buy" recommendations.
In other words, their interests aren't always aligned with retail investors, rarely indicating where the price of a stock could actually be heading. Therefore, the best use of this information could be validating your own research or an indicator that has proven to be highly successful in predicting a stock's price movement.
With an impressive externally audited track record, our proprietary stock rating tool, the Zacks Rank, which classifies stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), is a reliable indicator of a stock's near-term price performance. So, validating the Zacks Rank with ABR could go a long way in making a profitable investment decision.
ABR Should Not Be Confused With Zacks RankIn spite of the fact that Zacks Rank and ABR both appear on a scale from 1 to 5, they are two completely different measures.
Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
Analysts employed by brokerage firms have been and continue to be overly optimistic with their recommendations. Since the ratings issued by these analysts are more favorable than their research would support because of the vested interest of their employers, they mislead investors far more often than they guide.
In contrast, the Zacks Rank is driven by earnings estimate revisions. And near-term stock price movements are strongly correlated with trends in earnings estimate revisions, according to empirical research.
Furthermore, the different grades of the Zacks Rank are applied proportionately across all stocks for which brokerage analysts provide earnings estimates for the current year. In other words, at all times, this tool maintains a balance among the five ranks it assigns.
Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.
Should You Invest in EME?Looking at the earnings estimate revisions for Emcor Group, the Zacks Consensus Estimate for the current year has increased 1.9% over the past month to $29.22.
Analysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason for the stock to soar in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Emcor Group. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Therefore, the Buy-equivalent ABR for Emcor Group may serve as a useful guide for investors.
For those looking to find strong Construction stocks, it is prudent to search for companies in the group that are outperforming their peers. Has Emcor Group (EME - Free Report) been one of those stocks this year? A quick glance at the company's year-to-date performance in comparison to the rest of the Construction sector should help us answer this question.
Emcor Group is one of 88 individual stocks in the Construction sector. Collectively, these companies sit at #15 in the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors.
The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. Emcor Group is currently sporting a Zacks Rank of #2 (Buy).
Over the past 90 days, the Zacks Consensus Estimate for EME's full-year earnings has moved 3.5% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.
Based on the latest available data, EME has gained about 35.3% so far this year. Meanwhile, stocks in the Construction group have gained about 14.8% on average. This means that Emcor Group is performing better than its sector in terms of year-to-date returns.
Knife River (KNF - Free Report) is another Construction stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 18.6%.
In Knife River's case, the consensus EPS estimate for the current year increased 3.3% over the past three months. The stock currently has a Zacks Rank #2 (Buy).
To break things down more, Emcor Group belongs to the Building Products - Heavy Construction industry, a group that includes 8 individual companies and currently sits at #52 in the Zacks Industry Rank. Stocks in this group have gained about 37.4% so far this year, so EME is slightly underperforming its industry this group in terms of year-to-date returns.
In contrast, Knife River falls under the Building Products - Miscellaneous industry. Currently, this industry has 33 stocks and is ranked #191. Since the beginning of the year, the industry has moved +2.8%.
Going forward, investors interested in Construction stocks should continue to pay close attention to Emcor Group and Knife River as they could maintain their solid performance.
Emcor Group (EME - Free Report) ended the recent trading session at $836.59, demonstrating a +1.1% change from the preceding day's closing price. The stock outperformed the S&P 500, which registered a daily gain of 1.09%. Elsewhere, the Dow saw an upswing of 0.14%, while the tech-heavy Nasdaq appreciated by 1.91%.
Heading into today, shares of the construction and maintenance company had lost 3.01% over the past month, lagging the Construction sector's gain of 3.92% and the S&P 500's gain of 0.29%.
The investment community will be paying close attention to the earnings performance of Emcor Group in its upcoming release. The company is expected to report EPS of $7.24, up 7.74% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $4.7 billion, indicating a 9.08% increase compared to the same quarter of the previous year.
EME's full-year Zacks Consensus Estimates are calling for earnings of $29.22 per share and revenue of $18.83 billion. These results would represent year-over-year changes of +12.95% and +10.86%, respectively.
It's also important for investors to be aware of any recent modifications to analyst estimates for Emcor Group. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 1.9% higher. As of now, Emcor Group holds a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that Emcor Group has a Forward P/E ratio of 28.32 right now. This expresses a premium compared to the average Forward P/E of 20.71 of its industry.
The Building Products - Heavy Construction industry is part of the Construction sector. This industry, currently bearing a Zacks Industry Rank of 52, finds itself in the top 22% echelons of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
Emcor Group (EME - Free Report) closed at $823.05 in the latest trading session, marking a +1.42% move from the prior day. This move outpaced the S&P 500's daily gain of 0.5%. Meanwhile, the Dow gained 0.7%, and the Nasdaq, a tech-heavy index, added 0.31%.
Heading into today, shares of the construction and maintenance company had lost 12.74% over the past month, lagging the Construction sector's loss of 1.37% and the S&P 500's loss of 0.23%.
The upcoming earnings release of Emcor Group will be of great interest to investors. The company is expected to report EPS of $7.24, up 7.74% from the prior-year quarter. In the meantime, our current consensus estimate forecasts the revenue to be $4.7 billion, indicating a 9.08% growth compared to the corresponding quarter of the prior year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $29.22 per share and revenue of $18.83 billion, which would represent changes of +12.95% and +10.86%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Emcor Group. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 1.9% higher. Emcor Group presently features a Zacks Rank of #2 (Buy).
Investors should also note Emcor Group's current valuation metrics, including its Forward P/E ratio of 27.78. This expresses a premium compared to the average Forward P/E of 27.09 of its industry.
The Building Products - Heavy Construction industry is part of the Construction sector. With its current Zacks Industry Rank of 50, this industry ranks in the top 21% of all industries, numbering over 250.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
The surge of artificial intelligence (AI) and the resulting boom in new data centers are benefiting several pick-and-shovel stock plays, especially electrical infrastructure companies that both help get data centers up and running and keep them running.
Emcor Group (EME +1.33%), Schneider Electric (SBGSY 2.47%), and Quanta Services (PWR +3.64%) may not be well known outside of their sector, but all three are seeing dependable revenue growth, thanks to the data center build-out.
Image source: Getty Images.
1. Emcor: Double-digit growth, big backlog of orders Emcor, based in Norwalk, Connecticut, focuses on mechanical and electrical construction and facilities services in the United States and the United Kingdom. Data centers require massive cooling systems and complex electrical layouts to handle high-density computing. Emcor's recent guidance hike was largely driven by a record $15.6 billion backlog, up 32.9% year over year, much of which is tied to these high-margin, technically demanding projects.
In the first quarter, Emcor reported record revenue, record earnings per share (EPS), and a record backlog. The company said it had quarterly revenue of $4.63 billion, up 19.7% year over year; EPS of $6.84, up 30% over the same period last year; and a backlog of $15.62 billion, up 32.9% year over year.
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The numbers were good enough that Emcor raised its yearly revenue guidance to $18.5 billion to $19.25 billion, up from prior guidance of $17.75 billion to $18.5 billion. It also lifted its yearly EPS estimate to between $28.25 and $29.75, up from a range of $27.25 to $29.25.
Over the last decade, Emcor has used its strong free cash flow to buy back shares, including a recent $500 million buyback pledge, and acquire smaller, specialized firms, effectively growing its EPS even when the broader economy is flat.
2. Schneider is seeing diversified growth by region Based in France, Schneider is a global powerhouse in energy management and industrial automation. It provides software, circuit-protected devices, and uninterruptible power supply products for the grid. Its Aveva software suite allows companies to monitor energy efficiency in real time.
Schneider has massive exposure to North America, Europe, and Asia. This multi-hub model protects it against regional downturns. In the first quarter, it was doing well in all regions, led by North America, which saw revenue climb by 14.4% on an organic (growth generated from its own internal operations and existing businesses) basis year over year, and by China and East Asia, which reported revenue rising by 14.2% organically over the first quarter of 2025.
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Overall, revenue rose 4.7%, year over year, to 9.77 billion euros, led by a double-digit increase in demand for data center services. The company reaffirmed its 2026 guidance of 7% to 10% organic revenue growth and an organic increase of 50 to 80 basis points in the adjusted earnings before interest, taxes, and appreciation (EBITA) margin. It has a dividend yield of around 0.89% and has increased its dividend by 163% over the past decade.
3. Quanta Services is becoming a go-to player for data centers This Houston-based company builds physical transmission lines and substations that connect power plants (and wind/solar farms) to the end user. It reported a record backlog of $39.2 billion in the first quarter as one of the few companies with the scale and specialized labor to handle massive, multi-state transmission projects.
In the first quarter, Quanta reported EPS of $1.45, up 51%, year over year, and revenue of $7.9 billion, up 26% over the same period a year ago. The company has shifted into more manufacturing, making its own power transformers, which allows it to manage its own supply chain.
It also boosted nearly all of its guidance. It said it expects yearly revenue between $34.7 billion and $35.2 billion, up 22.8% at the midpoint, and yearly EPS between $9.17 and $9.87, an increase of 40% at the midpoint.
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One concern to watch While these stocks aren't household names, investors have noticed their growth. Their shares are up between 18% and 78% so far this year. For that reason, their valuations are relatively high for the electrical infrastructure sector, especially Quanta Services.
I like all three stocks, but among the trio, Emcor's valuation is the most reasonable. In the long term, Quanta Services appears to have the most growth potential. Schneider is also priced reasonably and presents the most diversification of the three, though with slower growth.
Key Takeaways EMCOR's RPOs rose 32.9% year over year to a record $15.62B as of March 31, 2026.EME is seeing strong demand across data centers, healthcare and water infrastructure projects.EMCOR raised 2026 revenue guidance to $18.5B-$19.25B on strong execution and project momentum. EMCOR Group, Inc. (EME - Free Report) is benefiting from strong project demand across key construction and infrastructure markets, with record Remaining Performance Obligations (“RPO”) improving revenue visibility for 2026. The company’s expanding RPO base reflects steady project awards, healthy execution trends and continued investment activity in areas such as data centers, healthcare and water infrastructure.
As of March 31, 2026, RPOs reached $15.62 billion, increasing 32.9% year over year from $11.75 billion and rising from $13.25 billion at the end of 2025. The increase was mainly driven by the construction business. U.S. mechanical construction accounted for $8.56 billion of RPOs, while U.S. electrical construction contributed $5.61 billion. Building services also added to the overall total.
The growing RPO base reflects sustained customer spending across network and communications, water and wastewater, institutional and healthcare projects. Data center activity remains one of the largest growth drivers as investments tied to artificial intelligence infrastructure, cloud infrastructure and digital transformation continue to expand. Additional awards across both core and adjacent geographies are also improving visibility into future project activity.
RPO growth across healthcare, institutional and manufacturing markets suggests that demand is not concentrated in a single vertical. Spending on upgraded lab space, facility modernization and logistics infrastructure continues to support project opportunities across multiple end markets. At the same time, investments in prefabrication, workforce development and project planning capabilities may help EMCOR improve execution efficiency as project scale and complexity increase.
Healthy demand trends and early-year project execution supported management’s decision to raise full-year 2026 guidance. EMCOR now expects revenues between $18.5 billion and $19.25 billion, higher than the prior expectation of $17.75-$18.50 billion. With strong RPO growth and continued project momentum across several end markets, EMCOR appears positioned to maintain steady revenue growth through 2026.
EMCOR’s Competitive Position: Scale and Infrastructure Demand in FocusEMCOR Group operates in a highly competitive engineering and construction market, competing with infrastructure-focused companies such as MasTec, Inc. (MTZ - Free Report) and Sterling Infrastructure, Inc. (STRL - Free Report) . Similar to EMCOR, both companies are benefiting from rising investments tied to data centers, artificial intelligence infrastructure, power systems and large-scale construction projects. However, differences in project mix, execution strategy and visibility into future work continue shaping the competitive landscape.
MasTec is seeing strong momentum across communications, power delivery and infrastructure markets, supported by rising investments in AI-driven data centers, grid modernization and energy infrastructure. In the first quarter of 2026, backlog reached a record $20.3 billion, increasing $1.4 billion sequentially. The company also raised full-year guidance following strong execution and continued demand across telecom, clean energy and infrastructure markets. MasTec highlighted growing opportunities tied to data center interconnectivity, transmission projects and turnkey construction services, positioning it as a strong competitor in mission-critical infrastructure projects.
Sterling Infrastructure is also benefiting from accelerating demand across mission-critical and data center projects. Combined backlog reached $5.2 billion in the first quarter, increasing 131% year over year, supported by semiconductor fabrication campuses, data centers and electrical infrastructure projects. Sterling also continues expanding geographically as customers increase spending on large and complex infrastructure projects. Growth in E-Infrastructure, along with rising project scale and integrated execution capabilities, continues strengthening Sterling’s position in high-growth construction markets.
EME Stock’s Price Performance & Valuation TrendShares of this Connecticut-based infrastructure service provider have gained 49.2% in the past six months, underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
EME stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 31.2, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EMEEME’s earnings estimates for 2026 and 2027 have moved upward in the past 30 days. The estimates for 2026 and 2027 imply year-over-year growth of 10.8% and 9.3%, respectively.
Image Source: Zacks Investment Research
EMCOR stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Emcor Group (EME - Free Report) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.
Shares of this construction and maintenance company have returned +17.4% over the past month versus the Zacks S&P 500 composite's +7.7% change. The Zacks Building Products - Heavy Construction industry, to which Emcor Group belongs, has gained 10.5% over this period. Now the key question is: Where could the stock be headed in the near term?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Earnings Estimate RevisionsHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
For the current quarter, Emcor Group is expected to post earnings of $7.02 per share, indicating a change of +4.5% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.5% over the last 30 days.
The consensus earnings estimate of $28.67 for the current fiscal year indicates a year-over-year change of +10.8%. This estimate has changed +1.5% over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $31.34 indicates a change of +9.3% from what Emcor Group is expected to report a year ago. Over the past month, the estimate has changed +1.3%.
With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Emcor Group.
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Revenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.
For Emcor Group, the consensus sales estimate for the current quarter of $4.65 billion indicates a year-over-year change of +8.1%. For the current and next fiscal years, $18.72 billion and $19.92 billion estimates indicate +10.2% and +6.4% changes, respectively.
Last Reported Results and Surprise HistoryEmcor Group reported revenues of $4.63 billion in the last reported quarter, representing a year-over-year change of +19.7%. EPS of $6.84 for the same period compares with $5.41 a year ago.
Compared to the Zacks Consensus Estimate of $4.22 billion, the reported revenues represent a surprise of +9.7%. The EPS surprise was +16.92%.
Over the last four quarters, Emcor Group surpassed consensus EPS estimates three times. The company topped consensus revenue estimates three times over this period.
ValuationNo investment decision can be efficient without considering a stock's valuation. Whether a stock's current price rightly reflects the intrinsic value of the underlying business and the company's growth prospects is an essential determinant of its future price performance.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Emcor Group is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Emcor Group. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
When deciding whether to buy, sell, or hold a stock, investors often rely on analyst recommendations. Media reports about rating changes by these brokerage-firm-employed (or sell-side) analysts often influence a stock's price, but are they really important?
Let's take a look at what these Wall Street heavyweights have to say about Emcor Group (EME - Free Report) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.
Emcor Group currently has an average brokerage recommendation (ABR) of 1.60, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 10 brokerage firms. An ABR of 1.60 approximates between Strong Buy and Buy.
Of the 10 recommendations that derive the current ABR, seven are Strong Buy, representing 70% of all recommendations.
Brokerage Recommendation Trends for EME
Check price target & stock forecast for Emcor Group here>>>
While the ABR calls for buying Emcor Group, it may not be wise to make an investment decision solely based on this information. Several studies have shown limited to no success of brokerage recommendations in guiding investors to pick stocks with the best price increase potential.
Are you wondering why? The vested interest of brokerage firms in a stock they cover often results in a strong positive bias of their analysts in rating it. Our research shows that for every "Strong Sell" recommendation, brokerage firms assign five "Strong Buy" recommendations.
This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.
With an impressive externally audited track record, our proprietary stock rating tool, the Zacks Rank, which classifies stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), is a reliable indicator of a stock's near-term price performance. So, validating the Zacks Rank with ABR could go a long way in making a profitable investment decision.
Zacks Rank Should Not Be Confused With ABRIn spite of the fact that Zacks Rank and ABR both appear on a scale from 1 to 5, they are two completely different measures.
Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.
In contrast, the Zacks Rank is driven by earnings estimate revisions. And near-term stock price movements are strongly correlated with trends in earnings estimate revisions, according to empirical research.
Furthermore, the different grades of the Zacks Rank are applied proportionately across all stocks for which brokerage analysts provide earnings estimates for the current year. In other words, at all times, this tool maintains a balance among the five ranks it assigns.
There is also a key difference between the ABR and Zacks Rank when it comes to freshness. When you look at the ABR, it may not be up-to-date. Nonetheless, since brokerage analysts constantly revise their earnings estimates to reflect changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in predicting future stock prices.
Is EME a Good Investment?Looking at the earnings estimate revisions for Emcor Group, the Zacks Consensus Estimate for the current year has increased 1.5% over the past month to $28.67.
Analysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason for the stock to soar in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Emcor Group. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Therefore, the Buy-equivalent ABR for Emcor Group may serve as a useful guide for investors.
NORWALK, Conn.--(BUSINESS WIRE)--EMCOR Group, Inc. (NYSE: EME) announced today that Tony Guzzi, Chairman, President, and Chief Executive Officer, and Jason Nalbandian, Senior Vice President and Chief Financial Officer, will participate in the following investor events.
KeyBanc Capital Markets Industrials & Basic Materials Conference
Date: Thursday, May 28, 2026
Location: Boston, Massachusetts
Interested investors should contact their KBCM representative directly to schedule a meeting.
William Blair 46th Annual Growth Stock Conference
Date: Tuesday, June 2, 2026
Location: Chicago, Illinois
Presentation Time: 12:20 p.m. EDT
Click here for live webcast
Interested investors should contact their William Blair representative directly to schedule a meeting. The presentation will be available via live audio webcast on the home page of the Company's website at http://www.emcorgroup.com and archived for replay through July 2, 2026.
Stifel 2026 Boston Cross Sector 1x1 Conference
Date: Wednesday, June 3, 2026
Location: Boston, Massachusetts
Interested investors should contact their Stifel representative directly to schedule a meeting.
A copy of the Company’s most recent investor presentation will be available under “Presentations” in Investor Relations section of the Company’s website, www.emcorgroup.com, prior to each event.
About EMCOR
A Fortune 500 company and a member of the S&P 500, EMCOR Group, Inc. is a leader in mechanical and electrical construction services, industrial and energy infrastructure and building services. This press release and other press releases may be viewed at the Company’s website at www.emcorgroup.com. EMCOR routinely posts information that may be important to investors on the landing page of the Company’s website and in the “Investor Relations” section of the website at www.emcorgroup.com/investor-relations. Investors and potential investors are encouraged to consult the EMCOR website regularly for important information about EMCOR.
Key Takeaways Sterling delivered Q1 2026 revenue up 92% and adjusted EPS up 120% to $3.59.STRL signed backlog rose 78% to $3.8B, with combined backlog up 131% to $5.15B.EMCOR posted record Q1 revenues of $4.63B and remaining obligations up 32.9% to $15.62B. The infrastructure construction space has emerged as one of the strongest-performing areas of the market in 2026, fueled by accelerating investments in artificial intelligence infrastructure, data centers, semiconductor manufacturing and grid modernization. Two companies benefiting significantly from these trends are Sterling Infrastructure (STRL - Free Report) and EMCOR Group (EME - Free Report)
Sterling has rapidly transformed itself into a high-growth infrastructure company with increasing exposure to mission-critical projects such as data centers and semiconductor facilities. EMCOR, meanwhile, remains one of the largest and most diversified specialty contractors in the United States, with strong positions across electrical construction, mechanical systems, industrial services and building maintenance.
Both companies recently delivered impressive first-quarter 2026 results, expanded backlog and raised guidance. They are also capitalizing on surging AI-driven infrastructure spending. However, investors are now trying to determine which stock offers the better mix of growth, execution and upside potential.
Let’s dive deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.
The Case for Sterling StockSterling has emerged as one of the market’s biggest infrastructure winners thanks to its growing exposure to mission-critical projects. The company’s E-Infrastructure business continues to benefit from explosive demand tied to hyperscale data centers, semiconductor fabs and advanced manufacturing facilities. Management stated that customers are requesting larger, more complex and longer-duration projects, while Sterling is also expanding into new geographies such as Texas, the Pacific Northwest and the Midwest.
The company’s first-quarter performance was exceptional. Revenues surged 92% year over year, while adjusted diluted earnings per share increased 120% to $3.59. Adjusted EBITDA margins exceeded 20%, reflecting Sterling’s strong execution and focus on high-return projects.
One of Sterling’s biggest strengths is backlog visibility. Signed backlog rose 78% year over year to $3.8 billion, while combined backlog jumped 131% to $5.15 billion. The company also highlighted more than $1.3 billion of future phase opportunities, giving it visibility into a total opportunity pool approaching $6.5 billion.
The semiconductor opportunity is becoming increasingly important for Sterling. During the quarter, the company secured the first phase of a large multi-year semiconductor fabrication campus project expected to extend through 2027 and beyond. Management also indicated that this could represent only the beginning of a broader wave of semiconductor construction activity later this decade.
Sterling is also benefiting from cross-selling opportunities following the CEC acquisition. The company is now executing both electrical and site development services on integrated data center projects, which management said materialized earlier than expected. This integrated approach could strengthen Sterling’s competitive positioning and support additional margin expansion.
Another key advantage is Sterling’s transformation over the past several years. The company has steadily shifted away from lower-margin traditional highway work toward higher-margin E-Infrastructure opportunities. Its operating margin improved dramatically from low-single digits several years ago to more than 16% in 2025.
Still, Sterling carries risks. The stock’s valuation has become very demanding after the huge rally. The company is also more concentrated in data-center-related infrastructure than EMCOR, creating greater exposure to any slowdown in hyperscaler spending. In addition, its Building Solutions business continues to face pressure from housing affordability challenges and weak residential demand.
Even so, Sterling’s growth profile currently stands out across the infrastructure space. The company raised full-year 2026 guidance significantly and now expects adjusted earnings per share (EPS) growth of roughly 72% year over year.
The Case for EMCOR StockEMCOR offers investors a different investment profile. Unlike Sterling, EMCOR operates at a much larger scale with a highly diversified construction and services platform spanning electrical construction, mechanical systems, industrial services and building maintenance.
The company delivered another outstanding first quarter. Revenue increased 19.7% year over year to a record $4.63 billion, while diluted earnings per share rose 30% to $6.84. Remaining performance obligations climbed 32.9% year over year to a record $15.62 billion.
EMCOR’s biggest advantage is diversification. The company is benefiting from strong demand across data centers, healthcare, institutional projects, manufacturing, water and wastewater infrastructure, logistics facilities and industrial construction. Management emphasized that growth is not solely dependent on data centers, although AI-related infrastructure remains a major driver.
Data centers remain a powerful tailwind. EMCOR reported nearly 50% revenue growth in network and communications within electrical construction and 86% growth in mechanical construction, tied largely to AI data-center cooling requirements and liquid-cooling infrastructure. The company stated that it sees “no sign of slowing demand” in AI infrastructure and cloud-related spending.
Operational execution remains another major strength. EMCOR generated a first-quarter operating margin of 8.7% (up 50 basis points from a year ago), despite some mix pressure from larger projects with lower markup structures. Its electrical construction business maintained a strong 12.1% operating margin (down from 12.5% a year ago), while mechanical construction delivered 10.9% (down from 11.9%). EMCOR also noted that, excluding acquisition-related transaction costs recorded in the year-ago quarter, non-GAAP operating margin improved to 8.7% from 8.5%, reflecting a 20-basis-point increase.
The balance sheet also remains extremely healthy. EMCOR ended the quarter with $916 million in cash and continues to generate strong profitability and shareholder returns through dividends and repurchases.
Another important advantage is EMCOR’s scale and customer relationships. The company is increasingly viewed as a preferred partner for highly complex mission-critical projects requiring advanced engineering, prefabrication, labor management and integrated execution capabilities.
However, EMCOR’s larger size naturally makes sustaining ultra-high growth more difficult. While its growth outlook remains strong, it is unlikely to match Sterling’s pace of earnings expansion over the next several years. EMCOR also faces some margin pressure from project mix shifts and increased use of cost-plus or GMP contracts on evolving large-scale projects.
Momentum on Wall Street Favors Both STRL and EME StocksBoth stocks have delivered strong returns in 2026, reflecting investor enthusiasm around AI infrastructure and mission-critical construction demand. Sterling stock has skyrocketed 177.2% year to date, massively outperforming EMCOR’s still-impressive 49.2% gain. Both companies have also significantly outperformed the broader Zacks Construction sector’s 11.5% rise and the S&P 500’s 9% increase.
The sharp rally in Sterling reflects investor confidence in its accelerating growth profile, backlog expansion and exposure to data centers and semiconductors. EMCOR’s gains, meanwhile, have been supported by consistent execution, diversified growth and strong profitability.
STRL vs EME Price Performance (YTD)
Image Source: Zacks Investment Research
Premium Valuations Reflect Strong Growth ExpectationsBoth stocks now trade at premium valuations relative to the broader market and construction sector. Sterling currently trades at 43.46X forward 12-month earnings, while EMCOR trades at 30.77X. Both are significantly above the Zacks Construction sector average of 20.5X and the S&P 500’s 22.07X.
Sterling’s much higher multiple reflects expectations for substantially faster earnings growth and continued margin expansion. EMCOR’s valuation appears more reasonable given its scale, diversification and consistent profitability profile.
STRL vs EME Valuation (P/E F12M)
Image Source: Zacks Investment Research
Earnings Revision Trends Continue to ImproveAnalyst sentiment remains favorable for both companies, though Sterling’s estimate revisions have been far stronger.
Over the past 30 days, the Zacks Consensus Estimate for Sterling’s 2026 EPS increased to $17.77 from $13.69. The estimate implies 63.3% year-over-year growth. Revenue is expected to rise 47.4% in 2026, followed by another 26.2% EPS growth in 2027.
Sterling’s EPS Estimate
Image Source: Zacks Investment Research
For EMCOR, the Zacks Consensus Estimate for 2026 EPS increased modestly to $28.67 from $28.24 over the same period. The estimate implies 10.8% year-over-year growth, while revenues are expected to increase 10.2%.
EMCOR’s EPS Estimate
Image Source: Zacks Investment Research
The much stronger revision trend for Sterling highlights Wall Street’s growing confidence in the company’s accelerating growth trajectory.
Which Stock Looks Like the Better Buy?Both Sterling and EMCOR remain exceptionally well-positioned to benefit from AI infrastructure, data-center expansion and broader mission-critical construction spending.
EMCOR offers investors greater diversification, stronger scale, lower valuation risk and highly consistent execution. Its record backlog, healthy balance sheet and exposure across multiple infrastructure verticals make it an attractive long-term compounder.
However, Sterling currently appears to offer the stronger upside potential. The company’s explosive backlog growth, rising exposure to semiconductors and hyperscale data centers, improving margins and rapidly accelerating earnings profile give it a more powerful near-term growth trajectory. Its integrated electrical and site-development strategy is also emerging as a key competitive differentiator.
The valuation premium is substantial, and volatility will likely remain elevated. Still, Sterling’s superior earnings growth outlook and stronger estimate revisions provide it with an edge at current levels.
With a Zacks Rank #1 (Strong Buy) compared with EMCOR’s Zacks Rank #2 (Buy), Sterling appears to be the better infrastructure stock for aggressive growth-oriented investors right now, while EMCOR remains an excellent choice for investors seeking a more diversified and relatively lower-risk infrastructure compounder. You can see the complete list of today’s Zacks #1 Rank stocks here.
Key Takeaways EME's network & communications revenues rose ~50% in electrical and 86% in mechanical on data center demand.Data center demand drove about two-thirds of EME's electrical growth; cooling needs boosted mechanical.EME hit record $15.62B obligations and lifted 2026 guidance, though AI projects may pressure margins. EMCOR Group, Inc.’s (EME - Free Report) growing exposure to data center infrastructure emerged as a key growth driver in the first quarter of 2026, reflecting rising AI-driven demand across electrical construction markets. In its U.S. electrical construction segment, revenues from network and communications, where EMCOR houses its data center business, rallied nearly 50% year over year, driven by strong data center demand. This surge served as a powerful engine for the broader segment, single-handedly accounting for approximately two-thirds of the electrical division's total quarterly revenue growth.
The momentum was even more pronounced within the mechanical construction segment, which saw network and communications revenues surge by 86% year over year. This explosive expansion was directly underpinned by escalating cooling requirements and rapid advancements in liquid cooling technologies, which are tailored precisely for high-intensity AI workloads and are continuing to unlock robust, large-scale opportunities across their mechanical operations.
Management pointed to “no sign of slowing demand” in data centers, citing customer investments in AI infrastructure, cloud infrastructure and broader digital transformation. This momentum also helped lift EMCOR’s remaining performance obligations to a record $15.62 billion, up 32.9% year over year, giving the company stronger revenue visibility for the rest of 2026.
The AI opportunity is not just boosting sales, but also expanding EMCOR’s strategic relevance. Management noted that data center bookings are coming from both electrical and mechanical scopes, with revenue growth in network and communications up by roughly $240 million in electrical and $280 million in mechanical. However, growth may come with some margin trade-offs, as newer AI data center projects can involve evolving designs, larger scopes and more GMP or cost-plus contract structures.
Overall, AI appears to be a clear tailwind for EMCOR’s growth outlook. The company raised its 2026 revenue guidance to $18.5 billion-$19.25 billion and EPS guidance to $28.25-$29.75, reflecting strong demand, a record backlog and confidence in execution across large-scale, mission-critical projects.
EMCOR’s Competitive Landscape: AI Infrastructure in FocusEMCOR operates in an increasingly competitive mission-critical infrastructure market alongside major industry players such as Sterling Infrastructure, Inc. (STRL - Free Report) and Quanta Services, Inc. (PWR - Free Report) . All three companies are benefiting from accelerating investment tied to AI-driven data centers, electrification, grid modernization and large-scale infrastructure development, though their operating models and execution capabilities differ meaningfully.
Sterling has recently delivered exceptional momentum in mission-critical site development. In the first quarter of 2026, revenues surged 92% year over year, adjusted EBITDA more than doubled and margins reached a record 20%. Growth was driven by the E-Infrastructure segment, where revenues climbed 174% on strong hyperscale data center demand, semiconductor-related awards and expanding multi-year customer programs. Sterling’s backlog reached $5.2 billion, including more than $5 billion of visibility within E-Infrastructure alone.
Quanta, meanwhile, continues to benefit from its unmatched scale in electric power transmission, distribution and utility infrastructure. The company reported a record backlog of $48.5 billion, supported by strong demand across power delivery, technology-load infrastructure, renewable energy and grid modernization markets. Quanta’s investments in transformer manufacturing and off-site fabrication further strengthen its execution capabilities as customers increasingly prioritize schedule certainty in complex infrastructure projects.
EME Stock’s Price Performance & Valuation TrendShares of this Connecticut-based infrastructure service provider have gained 50.8% in the past six months, underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
EME stock is currently trading at a premium compared with the industry, with a forward 12-month price-to-earnings (P/E) ratio of 30.77, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EMEEME’s earnings estimates for 2026 and 2027 have moved upward in the past 30 days. The estimates for 2026 and 2027 imply year-over-year growth of 10.8% and 9.3%, respectively.
Image Source: Zacks Investment Research
EMCOR stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Emcor Group (EME - Free Report) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #2 (Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.
The Zacks rating relies solely on a company's changing earnings picture. It tracks EPS estimates for the current and following years from the sell-side analysts covering the stock through a consensus measure -- the Zacks Consensus Estimate.
Individual investors often find it hard to make decisions based on rating upgrades by Wall Street analysts, since these are mostly driven by subjective factors that are hard to see and measure in real time. In these situations, the Zacks rating system comes in handy because of the power of a changing earnings picture in determining near-term stock price movements.
As such, the Zacks rating upgrade for Emcor Group is essentially a positive comment on its earnings outlook that could have a favorable impact on its stock price.
Most Powerful Force Impacting Stock PricesThe change in a company's future earnings potential, as reflected in earnings estimate revisions, has proven to be strongly correlated with the near-term price movement of its stock. The influence of institutional investors has a partial contribution to this relationship, as these big professionals use earnings and earnings estimates to calculate the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their bulk investment action then leads to price movement for the stock.
For Emcor Group, rising earnings estimates and the consequent rating upgrade fundamentally mean an improvement in the company's underlying business. And investors' appreciation of this improving business trend should push the stock higher.
Harnessing the Power of Earnings Estimate RevisionsEmpirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, so it could be truly rewarding if such revisions are tracked for making an investment decision. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.
The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>> .
Earnings Estimate Revisions for Emcor GroupThis construction and maintenance company is expected to earn $28.67 per share for the fiscal year ending December 2026, which represents no year-over-year change.
Analysts have been steadily raising their estimates for Emcor Group. Over the past three months, the Zacks Consensus Estimate for the company has increased 4.6%.
Bottom LineUnlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of "buy" and "sell" ratings for its entire universe of more than 4,000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a "Strong Buy" rating and the next 15% get a "Buy" rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.
You can learn more about the Zacks Rank here >>>
The upgrade of Emcor Group to a Zacks Rank #2 positions it in the top 20% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.
Emcor Group (EME - Free Report) has recently been on Zacks.com's list of the most searched stocks. Therefore, you might want to consider some of the key factors that could influence the stock's performance in the near future.
Over the past month, shares of this construction and maintenance company have returned -4.1%, compared to the Zacks S&P 500 composite's +4.4% change. During this period, the Zacks Building Products - Heavy Construction industry, which Emcor Group falls in, has lost 3.7%. The key question now is: What could be the stock's future direction?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Revisions to Earnings EstimatesHere at Zacks, we prioritize appraising the change in the projection of a company's future earnings over anything else. That's because we believe the present value of its future stream of earnings is what determines the fair value for its stock.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors' interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For the current quarter, Emcor Group is expected to post earnings of $7.02 per share, indicating a change of +4.5% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.5% over the last 30 days.
For the current fiscal year, the consensus earnings estimate of $28.67 points to a change of +10.8% from the prior year. Over the last 30 days, this estimate has changed +1.5%.
For the next fiscal year, the consensus earnings estimate of $31.34 indicates a change of +9.3% from what Emcor Group is expected to report a year ago. Over the past month, the estimate has changed +1.3%.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Emcor Group is rated Zacks Rank #2 (Buy).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.
For Emcor Group, the consensus sales estimate for the current quarter of $4.65 billion indicates a year-over-year change of +8.1%. For the current and next fiscal years, $18.72 billion and $19.92 billion estimates indicate +10.2% and +6.4% changes, respectively.
Last Reported Results and Surprise HistoryEmcor Group reported revenues of $4.63 billion in the last reported quarter, representing a year-over-year change of +19.7%. EPS of $6.84 for the same period compares with $5.41 a year ago.
Compared to the Zacks Consensus Estimate of $4.22 billion, the reported revenues represent a surprise of +9.7%. The EPS surprise was +16.92%.
Over the last four quarters, Emcor Group surpassed consensus EPS estimates three times. The company topped consensus revenue estimates three times over this period.
ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.
Comparing the current value of a company's valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an A is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Emcor Group is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
ConclusionThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Emcor Group. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
Key Takeaways EMCOR's U.S. Mechanical Construction revenues rose 28.9% to $2.03B in first-quarter 2026.EME's remaining performance obligations climbed 32.9% year over year to a record $15.62B.EMCOR's mechanical construction margin fell 100 basis points to 10.9% on project mix shifts. EMCOR Group, Inc. (EME - Free Report) is seeing strong momentum in its mechanical construction business, though the segment’s recent performance also reflects the trade-off between rapid expansion and profitability. Growth across institutional, manufacturing, industrial and commercial projects helped U.S. Mechanical Construction and Facilities Services’ revenues increase 28.9% year over year to $2.03 billion in the first quarter of 2026. Demand tied to cooling systems, HVAC infrastructure and large-scale project activity also remained supportive.
The company’s project pipeline suggests that this strength is unlikely to fade soon. Remaining performance obligations reached a record $15.62 billion as of March 31, 2026, rising 32.9% from the prior-year period. U.S. mechanical construction represented $8.56 billion of the total balance, reflecting continued project awards and healthy customer spending across several end markets. Improving activity in warehousing, distribution and logistics projects also indicates broader recovery trends beyond core infrastructure spending.
At the same time, the segment’s profitability profile has started to shift. Operating margin declined 100 basis points year over year to 10.9% as project mix moved toward GMP and cost-plus contracts, particularly in newer geographies and projects with evolving scope. These contracts typically carry lower margin percentages due to reduced markups and higher coordination requirements. A larger contribution from food processing and prime contractor work also weighed on margins during the quarter.
Still, EMCOR appears more focused on expanding margin dollars and maintaining long-term customer relationships than protecting peak margin percentages in the near term. If project demand remains healthy and execution stays disciplined, the company’s mechanical construction business could continue supporting overall earnings growth despite ongoing mix-related pressure.
EMCOR’s Competitive Standing in Infrastructure MarketsEMCOR operates in a competitive infrastructure and mission-critical construction market alongside companies such as Sterling Infrastructure, Inc. (STRL - Free Report) and Quanta Services, Inc. (PWR - Free Report) . Sterling has been gaining momentum in large-scale site development and electrical infrastructure projects tied to hyperscale data centers, semiconductor facilities and manufacturing expansion. It continues to benefit from rising project complexity, vertical integration capabilities and growing demand across newer geographies, particularly as Sterling’s customers prioritize speed and execution certainty on mission-critical projects.
Quanta, meanwhile, maintains a strong position in power infrastructure, utility transmission and large-load connectivity markets. The company has been expanding its fabrication, supply-chain and manufacturing capabilities to support growing power demand linked to AI infrastructure, electrification and grid modernization. Quanta’s integrated solutions model and scale across transmission, generation and technology infrastructure markets continue to strengthen its ability to execute large multiyear projects while supporting schedule certainty for customers.
EME Stock’s Price Performance & Valuation TrendShares of this Connecticut-based infrastructure service provider have gained 17.1% in the past three months, outperforming the Zacks Building Products - Heavy Construction industry, the Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
EME stock is currently trading at a premium compared with the industry, with a forward 12-month price-to-earnings (P/E) ratio of 28.96, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EMEEME’s earnings estimates for 2026 and 2027 have moved upward in the past 30 days. The estimates for 2026 and 2027 imply year-over-year growth of 10.8% and 9.3%, respectively.
Image Source: Zacks Investment Research
EMCOR currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A month has gone by since the last earnings report for Emcor Group (EME - Free Report) . Shares have lost about 4.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Emcor Group due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
EMCOR Q1 Earnings and Revenues Beat Estimates, Both Rise Y/YEMCOR reported impressive first-quarter 2026 results, with earnings and revenues topping the Zacks Consensus Estimate and increasing year over year on strong demand across its core markets.
The quarter’s results reflect continued momentum across key end markets and customers’ confidence in the company’s ability to execute complex and mission-critical projects. Strong activity in sectors like Network and Communications, Institutional, Healthcare, and Water and Wastewater supported growth and drove higher remaining performance obligations (RPOs). Strong operational execution, disciplined project management and favorable project mix further supported profitability and margin expansion during the quarter.
Inside EME’s Q1 DiscussionThe company reported earnings per share of $6.84, surpassing the Zacks Consensus Estimate of $5.85 by 16.9%. In the year-ago quarter, the company reported earnings per share of $5.41.
Revenues of $4.63 billion also topped the consensus mark of $4.22 billion by 9.7% and increased 19.7% year over year from $3.87 billion. Organic revenues grew 16.8%, reflecting strong underlying demand.
Selling, general and administrative expenses (as a percentage of revenues) declined year over year by 50 basis points (bps) to 9.9%, indicating improved cost discipline. Operating margin in the quarter was 8.7%, up 50 bps year over year from 8.2%, driven by operating leverage and efficient execution.
EMCOR’s Segmental DetailsEMCOR operates across multiple U.S.-focused segments, including electrical and mechanical construction services, building services and industrial services.
U.S. Electrical Construction and Facilities Services: Revenues increased to $1.45 billion from $1.09 billion in the prior-year quarter. Operating income rose to $174.5 million, though the margin contracted 40 bps year over year to 12.1%.
U.S. Mechanical Construction and Facilities Services: Revenues grew to $2.03 billion from $1.57 billion in the prior-year quarter. Operating income increased to $221.6 million, but the margin declined 100 bps year over year to 10.9%.
U.S. Building Services: Revenues increased modestly to $772.6 million from $742.6 million in the prior-year quarter. Operating income rose to $40.4 million, with the margin expanding 30 bps to 5.2%.
U.S. Industrial Services: Revenues grew to $381.8 million from $359 million in the prior-year quarter. Operating income improved to $12.8 million, with the margin expanding 140 bps to 3.3%.
Liquidity & Cash Flow of EMCORAs of March 31, 2026, EMCOR had cash and cash equivalents of $916.4 million compared with $1.11 billion at 2025-end.
Net cash provided by operating activities totaled $0.6 million for the quarter, reflecting changes in working capital. As of March 31, 2026, RPOs increased to $15.62 billion from $13.25 billion at the end of 2025 and $11.75 billion a year ago, reflecting strong demand.
EMCOR Raises 2026 Guidance on Strong VisibilityBacked by robust demand and improved visibility, EMCOR raised its full-year 2026 guidance. The company now expects revenues between $18.50 billion and $19.25 billion, up from the previous range of $17.75 billion to $18.50 billion. Diluted earnings per share are projected in the range of $28.25 to $29.75, compared with prior expectations of $27.25 to $29.25. Operating margin guidance remains unchanged at 9% to 9.4%.
How Have Estimates Been Moving Since Then?It turns out, fresh estimates have trended upward during the past month.
VGM ScoresAt this time, Emcor Group has a average Growth Score of C, however its Momentum Score is doing a bit better with a B. However, the stock was allocated a score of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
OutlookEstimates have been trending upward for the stock, and the magnitude of this revision looks promising. Interestingly, Emcor Group has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Listen to the audio version of this article (generated by AI).
The Next Great AI Winners May Surprise You I saw my first cell phone, used by a real person, in 1987.
It belonged to an executive friend of my father’s. Calling it a “phone” almost feels generous by today’s standards. The thing looked more like military equipment than consumer technology.
It was a massive black brick attached to its own carrying case. It wasn’t the one pictured below, but it was similar.
Credit: MarkSwallow
At the time, it felt futuristic beyond belief.
Almost nobody had one. In those days, most of us still lived with landlines mounted on kitchen walls… or tangled cords stretched halfway across the house for “private” conversations.
So, the idea that someone could make a phone call from a car, or an airport, or the middle of nowhere felt like a miracle.
Eventually, as the free-market mechanism worked its magic, the price went down, the technology improved and cellular technology finally became affordable to ordinary people.
Soon, everybody had a mobile phone.
And eventually, one company rose above all the others.
Nokia.
Back then, Nokia didn’t just dominate the cellphone business — for many people, it *was* the cellphone business.
Its phones were reliable, indestructible, cutting-edge and everywhere.
Most consumers – and most investors – couldn’t imagine a world where Nokia wouldn’t remain king of mobile technology. Even as late as 2007, their phones were the industry standard and they seemed unstoppable.
But everything changed later that year when Apple unveiled the iPhone. You probably know the rest of that story…
By November 2009, Apple had become the most profitable phone maker. By April 2011, Apple became the world’s largest phone maker by revenue. By July 2011, Apple had overtaken Nokia in smartphone units shipped. The companies that dominated the first phase of the mobile phone revolution weren’t the ones that would dominate the next.
And according to legendary investor Louis Navellier, AI may now be approaching a very similar turning point.
Spotting the Change Early Over the past four decades, Louis has built a reputation for spotting major technology trends early. Long before Nvidia became synonymous with AI Louis was recommending the stock to his followers.
That’s why it’s now about a 5,000% winner in his Growth Investor service.
Years earlier, he recognized the potential of companies like Apple (AAPL), Amazon (AMZN), and Google (GOOG) before they became household investment names. That’s why he is recognized by MarketWatch as the adviser who “recommended Google before anyone else.”
Almost three years ago, Louis was already positioning his subscribers to profit from the explosion of data center construction.
At that time, companies like Intel (INTC), Samsung, Taiwan Semiconductor (TSM), Micron Technology (MU), and Texas Instruments (TXN) had all just pledged to expand and upgrade their facilities in the U.S., creating strong demand for the services and solutions that EMCOR Group, Inc. (EME) provides.
EME is a leading provider of electrical and mechanical construction, energy and industrial infrastructure and building services through three businesses.
EMCOR Construction Services specializes in mechanical and electrical construction, fire protection, and design-build solutions for hospitals, data centers, and commercial sites. EMCOR Buildings Services provides a range of comprehensive building services, including site maintenance, renovation and retrofits, energy services, HVAC and mechanical services, landscaping, construction, and energy efficiency upgrades. EMCOR Industrial Services delivers engineering, manufacturing, fabrication, and maintenance services for heavy industries like oil refineries, biotech ad semiconductor facilities. When he recommended the stock, Louis highlighted that company management noted that it continues to experience “strong demand for semiconductor and data center construction projects,” which should add to its top and bottom lines going forward.
Since that pick, EME is up more than 280%.
Despite the stock’s growth, it is still below Louis’ buy price of $932. That means he believes it still has room to run.
The Next AI Shift Has Started Now, he believes artificial intelligence may be approaching another major shift.
Not the end of the AI boom…
But potentially the beginning of an entirely new phase – one that could create a new generation of winners while leaving some of today’s AI leaders behind.
According to Louis, the next phase of AI may not simply involve better chatbots or faster image generators.
In his new presentation, he dives into what’s happening. It’s a story that involves massive government-backed computing infrastructure, next-generation AI systems and technology capable of dramatically expanding what artificial intelligence can actually do.
In fact, he believes this shift could become so significant that many of today’s dominant AI companies may eventually look like Nokia after the iPhone.
That’s why I strongly encourage you to watch his new presentation while it’s still available online.
You can access it here.
The pace of technological change is much faster than it was in 2007, when the seemingly unstoppable Nokia got crushed by Apple.
Getting in front of that next big change can make a big difference in your portfolio.
Key Takeaways EMCOR sees growing opportunities in water and wastewater infrastructure beyond core markets.EME's RPOs hit a record $15.62B on March 31, 2026, up 32.9% year over year.EMCOR raised 2026 revenue and EPS guidance after strong bookings and project execution. EMCOR Group, Inc. (EME - Free Report) is seeing growing opportunities in the water and wastewater infrastructure market, a trend that could provide an additional source of growth beyond its traditional end markets. While mission-critical and commercial projects remain important contributors, increasing investment in essential public infrastructure is creating a broader runway for expansion.
Recent project activity suggests that water infrastructure is becoming a more meaningful part of EMCOR’s growth story. Management highlighted water and wastewater as one of the strongest areas of sequential growth in remaining performance obligations (RPOs), alongside network and communications, institutional and healthcare markets. Several project awards in Florida during the first quarter further underscore the company’s ability to capitalize on rising demand across the sector.
The broader project pipeline also supports this view. As of March 31, 2026, EMCOR’s RPOs reached a record $15.62 billion, increasing 32.9% year over year and rising from $13.25 billion at the end of 2025. The increase reflects continued project awards across both core and adjacent geographies, providing greater visibility into future revenue opportunities. Strong booking activity and project execution prompted management to raise its full-year 2026 outlook, with revenue guidance increased to $18.5-$19.25 billion and earnings-per-share estimates raised to $28.25-$29.75.
Water infrastructure spending is often supported by long-term structural drivers, including population growth, aging utility systems and stricter environmental standards. As municipalities and utilities invest in upgrades and expansion projects, demand for mechanical, electrical and related construction services is likely to remain healthy.
Although water and wastewater projects currently represent a relatively small portion of EMCOR’s overall business, the market is gaining importance within its project pipeline. Continued contract awards, growing RPO contributions and favorable industry trends suggest that water infrastructure could become an increasingly meaningful growth driver for EMCOR in the years ahead.
EMCOR’s Competitive Standing in Infrastructure MarketsEMCOR operates in a competitive infrastructure and mission-critical construction market alongside companies such as Sterling Infrastructure, Inc. (STRL - Free Report) and Quanta Services, Inc. (PWR - Free Report) . Sterling has been gaining momentum in large-scale site development and electrical infrastructure projects tied to hyperscale data centers, semiconductor facilities and manufacturing expansion. It continues to benefit from rising project complexity, vertical integration capabilities and growing demand across newer geographies, particularly as Sterling’s customers prioritize speed and execution certainty on mission-critical projects.
Quanta, meanwhile, maintains a strong position in power infrastructure, utility transmission and large-load connectivity markets. The company has been expanding its fabrication, supply-chain and manufacturing capabilities to support growing power demand linked to AI infrastructure, electrification and grid modernization. Quanta’s integrated solutions model and scale across transmission, generation and technology infrastructure markets continue to strengthen its ability to execute large multiyear projects while supporting schedule certainty for customers.
EME Stock’s Price Performance & Valuation TrendShares of this Connecticut-based infrastructure service provider have gained 36.3% in the past six months, underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
EME stock is currently trading at a discount compared with the industry, with a forward 12-month price-to-earnings (P/E) ratio of 27.34, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EMEEME’s earnings estimates for 2026 and 2027 have moved upward in the past 30 days. The estimates for 2026 and 2027 imply year-over-year growth of 11.5% and 11.7%, respectively.
Image Source: Zacks Investment Research
EMCOR currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Investors often turn to recommendations made by Wall Street analysts before making a Buy, Sell, or Hold decision about a stock. While media reports about rating changes by these brokerage-firm employed (or sell-side) analysts often affect a stock's price, do they really matter?
Let's take a look at what these Wall Street heavyweights have to say about Emcor Group (EME - Free Report) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.
Emcor Group currently has an average brokerage recommendation (ABR) of 1.73, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 11 brokerage firms. An ABR of 1.73 approximates between Strong Buy and Buy.
Of the 11 recommendations that derive the current ABR, seven are Strong Buy, representing 63.6% of all recommendations.
Brokerage Recommendation Trends for EME
Check price target & stock forecast for Emcor Group here>>>
While the ABR calls for buying Emcor Group, it may not be wise to make an investment decision solely based on this information. Several studies have shown limited to no success of brokerage recommendations in guiding investors to pick stocks with the best price increase potential.
Do you wonder why? As a result of the vested interest of brokerage firms in a stock they cover, their analysts tend to rate it with a strong positive bias. According to our research, brokerage firms assign five "Strong Buy" recommendations for every "Strong Sell" recommendation.
This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements.
With an impressive externally audited track record, our proprietary stock rating tool, the Zacks Rank, which classifies stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), is a reliable indicator of a stock's near-term price performance. So, validating the Zacks Rank with ABR could go a long way in making a profitable investment decision.
Zacks Rank Should Not Be Confused With ABRAlthough both Zacks Rank and ABR are displayed in a range of 1--5, they are different measures altogether.
Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.
It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.
On the other hand, earnings estimate revisions are at the core of the Zacks Rank. And empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
Furthermore, the different grades of the Zacks Rank are applied proportionately across all stocks for which brokerage analysts provide earnings estimates for the current year. In other words, at all times, this tool maintains a balance among the five ranks it assigns.
Another key difference between the ABR and Zacks Rank is freshness. The ABR is not necessarily up-to-date when you look at it. But, since brokerage analysts keep revising their earnings estimates to account for a company's changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in indicating future price movements.
Is EME Worth Investing In?Looking at the earnings estimate revisions for Emcor Group, the Zacks Consensus Estimate for the current year has increased 1.1% over the past month to $28.84.
Analysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason for the stock to soar in the near term.
The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Emcor Group. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Therefore, the Buy-equivalent ABR for Emcor Group may serve as a useful guide for investors.
The Construction group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Is Emcor Group (EME - Free Report) one of those stocks right now? A quick glance at the company's year-to-date performance in comparison to the rest of the Construction sector should help us answer this question.
Emcor Group is one of 88 companies in the Construction group. The Construction group currently sits at #16 within the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors.
The Zacks Rank is a successful stock-picking model that emphasizes earnings estimates and estimate revisions. The system highlights a number of different stocks that could be poised to outperform the broader market over the next one to three months. Emcor Group is currently sporting a Zacks Rank of #2 (Buy).
Within the past quarter, the Zacks Consensus Estimate for EME's full-year earnings has moved 2% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.
According to our latest data, EME has moved about 35.8% on a year-to-date basis. In comparison, Construction companies have returned an average of 11.3%. This shows that Emcor Group is outperforming its peers so far this year.
Knife River (KNF - Free Report) is another Construction stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 11.6%.
The consensus estimate for Knife River's current year EPS has increased 5.6% over the past three months. The stock currently has a Zacks Rank #2 (Buy).
Breaking things down more, Emcor Group is a member of the Building Products - Heavy Construction industry, which includes 8 individual companies and currently sits at #50 in the Zacks Industry Rank. Stocks in this group have gained about 38.3% so far this year, so EME is slightly underperforming its industry this group in terms of year-to-date returns.
Knife River, however, belongs to the Building Products - Miscellaneous industry. Currently, this 33-stock industry is ranked #179. The industry has moved -0.8% so far this year.
Emcor Group and Knife River could continue their solid performance, so investors interested in Construction stocks should continue to pay close attention to these stocks.
Key Takeaways EMCOR's RPOs reached a record $15.62 billion, with 78% expected to convert to revenues within 12 months.EMCOR is benefiting from healthcare modernization and rising university research facility investments.EMCOR is investing in training, prefabrication and technology to strengthen project execution. Shares of EMCOR Group, Inc. (EME - Free Report) have gained 35.7% in the past six months, underperforming the Zacks Building Products - Heavy Construction industry but outperforming the Construction sector and the S&P 500 Index, as evidenced by the chart below.
EME Stock’s Past 6 Months’ Price Performance
Image Source: Zacks Investment Research
This Connecticut-based infrastructure service provider continues to benefit from favorable trends across several end markets. Strong demand for healthcare and institutional projects, improving activity in warehousing and logistics facilities, and a growing contribution from higher-margin service work are supporting business momentum. At the same time, ongoing investments in workforce development, prefabrication and project execution capabilities are enhancing the company's ability to capitalize on opportunities across complex construction markets. These factors, together with healthy project activity across key end markets, provide support for EMCOR's long-term growth outlook.
Let us take a closer look at the factors shaping EMCOR stock’s prospects.
Record RPOs Enhance EMCOR’s Growth VisibilityStrong project awards across data centers, water and wastewater, healthcare and institutional markets helped EMCOR build a record Remaining Performance Obligations (“RPO”) position. RPOs totaled $15.62 billion at the end of the first quarter of 2026, reflecting a 32.9% increase from the prior-year period and sequential growth from $13.25 billion at year-end 2025.
The increase reflects healthy demand across several end markets, including AI infrastructure, cloud infrastructure and digital transformation projects. Approximately 78% of the current RPO balance is expected to convert into revenues over the next 12 months, providing strong visibility into future business activity. The record backlog position supports EMCOR’s ability to sustain growth across its construction operations.
EMCOR’s Healthcare and Institutional Markets Add Growth VisibilityBeyond data centers, EMCOR is seeing healthy project activity across healthcare and institutional end markets, helping diversify growth sources. Demand for healthcare facility modernization projects and upgraded laboratory space at colleges and universities contributed to project awards during the quarter. Management also indicated that institutional spending has remained more resilient than expected, supporting activity across several regions.
The mechanical construction segment benefited from strong institutional demand, with revenues from the market more than doubling year over year. Healthcare customers are continuing to invest in more flexible and efficient facilities, while universities are increasing spending on research and laboratory infrastructure. The broad-based demand across these sectors provides EMCOR with additional growth opportunities outside its core data center business.
Recovery in Warehousing and Logistics Activity Supports Construction GrowthImproving activity in warehousing, distribution and logistics projects is creating another source of growth for EMCOR’s construction operations. After a period of softness, commercial market demand has started to recover, supporting project volumes across several regions.
Within the mechanical construction segment, commercial revenues increased 33% year over year in the first quarter of 2026, driven largely by warehousing, distribution and logistics projects. The recovery has also supported fire protection activity, where EMCOR continues to expand project opportunities. As customer spending in logistics infrastructure improves, the company is positioned to benefit from additional construction and service work tied to these facilities.
EMCOR’s Productivity Investments Strengthen Execution CapabilitiesEMCOR continues to invest in operational capabilities that improve project execution and support long-term growth. The company is expanding workforce training programs, prefabrication capabilities, virtual design technologies and advanced project planning processes to improve efficiency across its construction operations.
The company expects to invest approximately $115 million to $125 million in capital expenditures during 2026, with a significant portion directed toward fabrication facilities and operational capabilities. At the same time, EMCOR continues to expand training programs and leadership development initiatives to support growth. These investments should improve execution efficiency while helping the company capitalize on opportunities across mission-critical construction markets.
Earnings Estimate Revision of EMEEME’s earnings estimates for 2026 and 2027 have moved upward in the past 30 days to $28.84 and $32.21 per share, respectively. The estimates for 2026 and 2027 imply year-over-year growth of 11.5% and 11.7%, respectively.
Image Source: Zacks Investment Research
EME’s Premium ValuationEME stock is currently trading at a premium compared with the industry, with a forward 12-month price-to-earnings (P/E) ratio of 27.47, as evidenced by the chart below.
Image Source: Zacks Investment Research
EMCOR vs. Other Market PlayersEMCOR competes closely with Quanta Services, Inc. (PWR - Free Report) , Dycom Industries, Inc. (DY - Free Report) and MasTec, Inc. (MTZ - Free Report) in the infrastructure and engineering construction market.
Quanta operates across electric power transmission, distribution and grid modernization markets, providing the infrastructure needed to support growing electricity demand. Its integrated solutions model, large skilled workforce and deep utility relationships provide a competitive advantage in large-scale power projects tied to grid expansion and data center-related power demand. On the other hand, the company remains heavily exposed to utility capital spending trends and the execution of large transmission programs.
Meanwhile, Dycom is a pure-play digital infrastructure contractor focused on fiber, broadband and communications network deployment. Strong demand for fiber-to-the-home, long-haul fiber routes and data center connectivity continues to support growth opportunities across the communications market. However, Dycom's concentrated exposure to telecommunications infrastructure increases dependence on customer network investment programs and broadband spending cycles.
Conversely, MasTec maintains a diversified infrastructure platform spanning telecommunications, power delivery, clean energy, industrial construction and pipeline markets. This broad exposure allows MasTec to benefit from multiple infrastructure investment themes, including data center development, grid modernization and energy infrastructure expansion. However, participation across several cyclical end markets can create greater earnings variability depending on project timing and execution.
EMCOR’s execution-focused operating model, diversified end-market exposure and balanced project portfolio provide a competitive advantage in terms of stability and demand resilience. However, Quanta’s scale in power infrastructure, Dycom’s communications specialization and MasTec’s diversified infrastructure presence may shape competition as investment in digital and critical infrastructure continues to increase.
How to Play EMCOR Stock?Expanding opportunities across healthcare, institutional and logistics markets are providing EMCOR with additional avenues for growth beyond its core data center business. Record RPOs, a favorable shift toward higher-margin service work and continued investments in productivity initiatives further support the company's long-term growth prospects.
While the stock trades at a premium valuation relative to many peers, the company's improving earnings outlook, diversified project pipeline and strong execution capabilities help support the premium. Backed by healthy demand trends and solid visibility into future projects, this Zacks Rank #2 (Buy) stock appears well positioned for continued growth. Investors may consider adding EME stock to their portfolios.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Emcor Group (EME - Free Report) ended the recent trading session at $817.44, demonstrating a -3.31% change from the preceding day's closing price. This move lagged the S&P 500's daily loss of 2.65%. Elsewhere, the Dow saw a downswing of 1.35%, while the tech-heavy Nasdaq depreciated by 4.18%.
Shares of the construction and maintenance company witnessed a loss of 8.51% over the previous month, trailing the performance of the Construction sector with its gain of 1.85%, and the S&P 500's gain of 5.47%.
Market participants will be closely following the financial results of Emcor Group in its upcoming release. The company's upcoming EPS is projected at $7.24, signifying a 7.74% increase compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $4.7 billion, up 9.08% from the prior-year quarter.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $29.22 per share and revenue of $18.83 billion, indicating changes of +12.95% and +10.86%, respectively, compared to the previous year.
Investors should also note any recent changes to analyst estimates for Emcor Group. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1.9% higher. Emcor Group currently has a Zacks Rank of #2 (Buy).
In terms of valuation, Emcor Group is currently trading at a Forward P/E ratio of 28.94. This represents a premium compared to its industry average Forward P/E of 27.6.
The Building Products - Heavy Construction industry is part of the Construction sector. This industry currently has a Zacks Industry Rank of 53, which puts it in the top 22% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow EME in the coming trading sessions, be sure to utilize Zacks.com.
Emcor Group (EME - Free Report) has been one of the most searched-for stocks on Zacks.com lately. So, you might want to look at some of the facts that could shape the stock's performance in the near term.
Shares of this construction and maintenance company have returned -11.6% over the past month versus the Zacks S&P 500 composite's +0.2% change. The Zacks Building Products - Heavy Construction industry, to which Emcor Group belongs, has lost 7.2% over this period. Now the key question is: Where could the stock be headed in the near term?
Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.
For the current quarter, Emcor Group is expected to post earnings of $7.24 per share, indicating a change of +7.7% from the year-ago quarter. The Zacks Consensus Estimate has changed +3.1% over the last 30 days.
The consensus earnings estimate of $29.22 for the current fiscal year indicates a year-over-year change of +13%. This estimate has changed +1.9% over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $32.48 indicates a change of +11.2% from what Emcor Group is expected to report a year ago. Over the past month, the estimate has changed +3.6%.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock's price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, Emcor Group is rated Zacks Rank #2 (Buy).
The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue GrowthWhile earnings growth is arguably the most superior indicator of a company's financial health, nothing happens as such if a business isn't able to grow its revenues. After all, it's nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it's important to know a company's potential revenue growth.
In the case of Emcor Group, the consensus sales estimate of $4.7 billion for the current quarter points to a year-over-year change of +9.1%. The $18.83 billion and $20.29 billion estimates for the current and next fiscal years indicate changes of +10.9% and +7.8%, respectively.
Last Reported Results and Surprise HistoryEmcor Group reported revenues of $4.63 billion in the last reported quarter, representing a year-over-year change of +19.7%. EPS of $6.84 for the same period compares with $5.41 a year ago.
Compared to the Zacks Consensus Estimate of $4.22 billion, the reported revenues represent a surprise of +9.7%. The EPS surprise was +16.92%.
Over the last four quarters, Emcor Group surpassed consensus EPS estimates three times. The company topped consensus revenue estimates three times over this period.
ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.
While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
Emcor Group is graded D on this front, indicating that it is trading at a premium to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Emcor Group. However, its Zacks Rank #2 does suggest that it may outperform the broader market in the near term.
