Valued at a market cap of $37.7 billion, EMCOR Group, Inc. (EME) is a leading provider of electrical and mechanical construction, building services, and industrial infrastructure solutions. The Norwalk, Connecticut-based company designs, integrates, installs, and maintains complex systems, such as HVAC, power generation, robotics, plumbing, and energy infrastructure, for commercial, industrial, healthcare, and governmental facilities.
This industrial company has significantly outperformed the broader market over the past 52 weeks. Shares of EME have soared 85.2% over this time frame, while the broader S&P 500 Index ($SPX) has gained 27.9%. Moreover, on a YTD basis, the stock is up 38.8%, compared to SPX’s 9.2% rise.
Zooming in further, EME has also notably outpaced the State Street Industrial Select Sector SPDR ETF’s (XLI) 21.6% rise over the past 52 weeks and 10.7% uptick on a YTD basis.
On Apr. 29, EME delivered strong Q1 results, and its shares surged 7% in the following trading session. The company posted record quarterly revenue of $4.63 billion, up 19.7% year-over-year and well above analyst expectations of $4.22 billion. Meanwhile, its EPS rose 30% from the year-ago quarter to $6.84, comfortably surpassing the consensus estimate of $5.85.
Supported by the robust quarterly performance and a record project backlog of $15.62 billion, EMCOR raised its full-year outlook. The company now expects revenue in the range of $18.5 billion to $19.25 billion and increased its EPS forecast to between $28.25 and $29.75.
For the current fiscal year, ending in December, analysts expect EME’s EPS to grow 10.8% year over year to $28.67. The company’s earnings surprise history is mixed. It exceeded the consensus estimates in three of the last four quarters, while missing on another occasion.
Among the 10 analysts covering the stock, the consensus rating is a "Moderate Buy," which is based on seven “Strong Buy” and three "Hold” ratings.
The configuration is slightly more bullish than a month ago, with six analysts suggesting a “Strong Buy” rating.
On Apr. 30, Stifel maintained a "Buy" rating on EME and raised its price target to $918, indicating an 8.1% potential upside from the current levels.
The mean price target of $925.17 suggests a 9% premium to its current price levels, while its Street-high price target of $1,123 implies a 32.3% potential upside.
