Core Insights - Primoris Services Corporation (PRIM) and MasTec, Inc. (MTZ) are leading infrastructure construction companies in North America, benefiting from rising investments in grid upgrades, renewable energy, and broadband expansion [1][2] - Both companies have different growth strategies, with Primoris focusing on renewables and natural gas, while MasTec adopts a broader scaling approach across various sectors [2][10] - Shared risks include tariff-related uncertainties, cost pressures, and execution challenges on large projects [3] Summary of Primoris (PRIM) - Primoris is diversifying its infrastructure services, emphasizing renewables and natural gas generation, supported by federal incentives and a multi-year solar pipeline [4] - In Q2 2025, renewables drove a 27% year-over-year revenue increase, with projected annual revenues nearing $2.5 billion [5] - The company is exploring $1.7 billion in potential data center projects, with communications revenues growing at a double-digit rate [6] - Backlog reached $11.5 billion, with expectations for growth in utilities, renewables, and industrial services [7] - EPS is projected to rise 24.8% year-over-year in 2025, with favorable revisions in earnings estimates [9][18] Summary of MasTec (MTZ) - MasTec has a diversified portfolio across communications, clean energy, power delivery, and pipelines, focusing on scaling in high-demand markets [10] - In Q2 2025, non-pipeline operations showed strong momentum, with significant increases in communications revenues and improved margins in clean energy [11] - Total backlog reached a record $16.45 billion, up 23.3% year-over-year, leading to raised revenue and EPS guidance for 2025 [13] - EPS is projected to grow 58% year-over-year in 2025, with upward revisions in earnings estimates [9][21] Stock Performance & Valuation - Primoris has outperformed MasTec and the Zacks Building Products - Heavy Construction industry in share price performance over the past three months [14] - MasTec trades at a premium valuation compared to Primoris, which has a more compelling valuation and stronger relative share price performance [15][22] - Primoris is rated Zacks Rank 1 (Strong Buy), indicating a better investment opportunity compared to MasTec, which holds a Zacks Rank 2 (Buy) [23]

Core Insights - Primoris Services Corporation (PRIM) is focusing on the growing data center market, positioning itself as a key partner in this sector [1][2] - The company has identified a $1.7 billion pipeline of potential data center projects, with $400-$500 million already shortlisted for contracts by year-end [2][9] - Primoris is expanding its service offerings beyond data centers, including site preparation, power generation, utility infrastructure, and fiber construction [2][3] Company Strategy - Most data center projects will be incremental to the existing business plan, allowing Primoris to scale without major resource redeployment [3] - The company’s industrial workforce is well-suited for this type of work, providing flexibility in scaling operations [3] - Demand for services extends beyond data centers, with significant opportunities in utilities and renewable energy projects, including a pipeline exceeding $2.5 billion [3] Financial Performance - Primoris has reported record second-quarter results, showcasing double-digit revenue growth and increased profitability in its Utilities segment [4] - The integrated model across energy, utilities, and communications is expected to enhance backlog and margin growth [4] Competitive Landscape - Competitors like Quanta Services, Inc. and MasTec, Inc. are also experiencing growth, with strong backlogs in power delivery and clean energy infrastructure [5][6] - Quanta emphasizes its self-perform model, while MasTec highlights long-term opportunities in communications and energy transition [5][6] Market Positioning - Primoris shares have increased by 66.5% over the past three months, outperforming the industry growth of 27.1% [7] - The company trades at a forward price-to-earnings ratio of 23.17, above the industry average of 21.89 [11] - Earnings estimates for 2025 and 2026 indicate year-over-year growth of 24.8% and 13.9%, respectively, with recent increases in EPS estimates [13]

Core Viewpoint - Primoris Services (PRIM) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook driven by rising earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Performance - The Zacks rating system emphasizes the importance of earnings estimate revisions, which are strongly correlated with near-term stock price movements [4][6]. - For the fiscal year ending December 2025, Primoris Services is expected to earn $4.83 per share, with a recent 8.9% increase in the Zacks Consensus Estimate over the past three months [8]. Zacks Rating System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a proven track record of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [7]. - The upgrade of Primoris Services to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10].

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Investors following momentum investing often avoid undervalued stocks, believing that quicker profits can be made from trending stocks [1] - Identifying the right entry point for fast-moving stocks can be challenging, as these stocks may lose momentum if future growth does not justify their high valuations [1] Group 2: Investment Opportunities - Primoris Services (PRIM) has shown a price increase of 3.7% over the past four weeks, indicating growing investor interest [3] - Over the past 12 weeks, PRIM's stock has gained 57.6%, demonstrating its ability to deliver positive returns over a longer timeframe [4] - PRIM has a beta of 1.42, suggesting it moves 42% more than the market in either direction, indicating fast-paced momentum [4] Group 3: Valuation and Earnings - PRIM has a Momentum Score of A, suggesting it is an opportune time to invest in the stock [5] - The stock has a Zacks Rank 2 (Buy) due to upward revisions in earnings estimates, which typically attract more investors [6] - PRIM is trading at a Price-to-Sales ratio of 0.92, indicating it is relatively cheap at 92 cents for each dollar of sales [6] Group 4: Additional Investment Options - Besides PRIM, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [7] - Zacks offers over 45 Premium Screens tailored to different investing styles, which can help identify potential winning stocks [8]

Core Viewpoint - Primoris Services Corporation (PRIM) is trading at a premium compared to the Zacks Building Products – Heavy Construction industry, reflecting market confidence in its financial performance and growth potential [1][5][21]. Valuation Comparison - PRIM's forward 12-month price-to-earnings (P/E) ratio is 22.8X, higher than the industry's 21.58X, the broader Construction sector's 19.85X, and the S&P 500 multiple of 22.59X [1][5]. - In contrast, PRIM is trading at a discount compared to peers like EMCOR Group, Inc. (EME), Quanta Services, Inc. (PWR), and MasTec, Inc. (MTZ), which have forward P/E multiples of 24.27, 32.18, and 25.07 respectively [4]. Stock Performance - PRIM shares have gained 56.3% over the past three months, outperforming the industry growth of 23.3%, the broader construction sector's 8.5%, and the S&P 500's 9.8% [5][21]. - The stock reached a new 52-week high of $120.22 on August 29, 2025, indicating strong upward momentum [5]. Growth Drivers - The company is benefiting from rising demand for renewable energy projects, with renewables revenues projected to reach $2.5 billion in 2025, up from earlier estimates of $2.2-$2.3 billion [6][11]. - Primoris is preparing bids for over $2.5 billion in natural gas generation projects and monitoring $20-$30 billion in solar opportunities through 2028, supported by favorable legislation [12]. - Data center and communications infrastructure expansion is also a significant growth driver, with $1.7 billion in opportunities under evaluation [13]. Backlog and Revenue Visibility - Primoris reported a backlog of $11.5 billion at the end of Q2 2025, reflecting a $100 million sequential increase, primarily driven by power delivery activities [15][16]. - The backlog provides strong visibility into future revenue streams and is expected to accelerate bookings through 2026 [16]. Financial Position - The company's net debt-to-EBITDA ratio improved to 0.5X by the end of Q2 2025, with long-term debt reduced to $525 million from $660.2 million at the end of 2024 [17]. - Operating cash flow reached $78 million in Q2 2025, contributing to a year-to-date cash generation of nearly $145 million, an improvement of $157 million from the previous year [18]. Earnings Estimates - Analysts have revised PRIM's earnings per share (EPS) estimates upward for 2025 and 2026 to $4.67 and $5.23 respectively, indicating year-over-year growth of 20.7% and 12.1% [19][20]. - Despite the premium valuation, analysts project further upside for the stock, supported by solid fundamentals and growth prospects [21][22].

Core Insights - Primoris Services Corporation (PRIM) is projected to achieve nearly $2.5 billion in renewables revenues by 2025, exceeding its previous forecast of $2.2-$2.3 billion, driven by strong demand in utility-scale solar, EPC work, and battery storage projects [1][9] - Recent legislative clarity regarding the phaseout of tax incentives has bolstered customer confidence, leading to solid bookings in the second half of the year, with $1.4 billion in renewables revenues already realized in the first half [2] - The Energy segment's gross margin for Q2 2025 decreased to 10.8% from 12.6% year-over-year, attributed to fewer project closeouts and increased costs due to adverse weather, although margins are expected to improve in the latter half of the year [3][9] - The $2.5 billion renewables target underscores PRIM's significant opportunity in solar and clean energy infrastructure, with a focus on maintaining profitability amid rapid growth [4] Competitor Landscape - Quanta Services Inc. (PWR) reported a record backlog of $35.8 billion and enhanced its capabilities through a $1.35 billion acquisition, solidifying its position in the energy transition [6] - MasTec, Inc. (MTZ) saw its Clean Energy and Infrastructure segment backlog grow by approximately $1.26 billion in Q2 2025, with revenues increasing by 20% year-over-year, highlighting the competitive landscape in clean energy [7] Price Performance, Valuation & Estimates - Primoris shares have increased by 58.9% over the past three months, outperforming the Zacks Building Products - Heavy Construction industry's growth of 23.6% [8] - The company trades at a forward 12-month price-to-earnings ratio of 22.98X, compared to the industry's 21.49X [11] - Earnings estimates for 2025 and 2026 have risen by 4.2% to $4.67 per share and by 2.3% to $5.23 per share, indicating year-over-year growth of 20.7% and 12.1%, respectively [13]

Industry Overview - The industrials sector has performed well despite overall market turbulence, with the Industrial Select Sector SPDR Fund (XLI) rising nearly 17% year-to-date, outperforming the S&P 500 [1] - Factors contributing to the sector's strength include federal government initiatives for reshoring manufacturing, increased infrastructure spending, and defense-related growth [2] Company Highlights - Primoris Services Corp. (NASDAQ: PRIM) reported a strong second-quarter earnings performance, with earnings per share (EPS) of $1.68, exceeding expectations by 58 cents, and a year-over-year revenue increase of 21% [4][5] - Primoris has a significant backlog of $11.5 billion, positioning it well to benefit from the growing demand in data center infrastructure, particularly in cloud and AI sectors [5] - AZZ Inc. (NYSE: AZZ) has successfully realigned its business through strategic divestments and acquisitions, including the purchase of Canton Galvanizing, which enhances its capacity and customer base [8][9] - Dycom Industries Inc. (NYSE: DY) reported an EPS of $3.33, surpassing expectations, with a revenue increase of nearly 15% year-over-year, indicating strong growth potential in the telecommunications and utility infrastructure sectors [11][12] Analyst Ratings and Forecasts - Primoris Services has a moderate buy rating from analysts, with a 12-month stock price forecast averaging $101.67, indicating a potential downside of 14.35% from the current price of $118.70 [4][6] - AZZ Inc. has a moderate buy rating as well, with a 12-month stock price forecast averaging $112.29, suggesting a slight downside of 0.68% from the current price of $113.06 [8][10] - Dycom Industries has a buy rating with a 12-month stock price forecast averaging $289.43, indicating a potential upside of 14.65% from the current price of $252.44 [11][13]

Core Insights - Primoris Services Corporation (PRIM) is focusing on large-scale infrastructure opportunities, particularly in data centers, as a significant growth avenue [1][2] - The company is actively pursuing over $1.7 billion in data center projects, leveraging its expertise in mission-critical infrastructure [2][10] - PRIM's revenue for Q2 2025 reached $1.89 billion, a 20.9% increase year-over-year, driven by growth in the Energy and Utilities segments [3][10] - The company's backlog improved to $11.5 billion, indicating strong future activity and confidence in addressing evolving infrastructure needs [3][4] Financial Performance - Revenues for Q2 2025 were $1.89 billion, up 20.9% year-over-year, primarily due to strong performance in Energy and Utilities [3][10] - The backlog at the end of Q2 2025 was $11.5 billion, supporting ongoing and future projects [3][10] - Earnings estimates for 2025 and 2026 have increased by 4.2% and 2.3%, respectively, indicating expected growth of 20.7% and 12.1% year-over-year [14] Market Position and Valuation - PRIM's shares have increased by 66.3% over the past three months, outperforming the Zacks Building Products - Heavy Construction industry's growth of 29.7% [9] - The company trades at a forward price-to-earnings ratio of 23.72X, slightly above the industry's 22.18X [12] - PRIM currently holds a Zacks Rank 1 (Strong Buy), reflecting positive market sentiment [15] Industry Trends - Rising demand for data centers is creating opportunities across the infrastructure sector, benefiting companies like EMCOR Group and MasTec [6] - EMCOR reported a 55.2% year-over-year revenue growth in its U.S. Electrical Construction segment, driven by data center construction [7] - MasTec experienced a 42% year-over-year increase in Communications revenues, supported by data center-related projects [8]

Market Overview - The market received a boost from Fed Chair Jerome Powell's Jackson Hole speech, indicating potential rate cuts as early as September, leading to a 1.5% rally in the S&P 500 [1][10] - Powell's acknowledgment of persistent inflation, coupled with a focus on job growth, reassured investors about the Fed's readiness to intervene if economic momentum slows [1][10] - By the end of the week, traders raised their bets on a September rate cut, with odds exceeding 90% [1] Investor Sentiment - Investors interpreted Powell's remarks as a sign that tariff-related inflation is viewed as temporary, not a long-term concern, which has fueled optimism in equities [2][10] - With falling treasury yields and a returning risk appetite, equities are expected to continue gaining in the upcoming weeks [2] Stock Recommendations - Recommended stocks based on relative price strength include Pediatrix Medical Group (MD), Enova International (ENVA), Primoris Services Corporation (PRIM), SkyWest, Inc. (SKYW), and Agnico Eagle Mines Limited (AEM) [3][10] Stock Analysis Strategy - Investors should assess stocks based on earnings growth and valuation multiples, while also considering their performance relative to industry peers or benchmarks [4] - Underperforming stocks should be avoided, while those outperforming their sectors in price should be prioritized for potential returns [5] - Stocks that have outperformed the S&P 500 over the past 1 to 3 months and have solid fundamentals are ideal candidates for investment [6] Earnings Estimates - Positive estimate revisions for upcoming earnings are crucial; upward revisions typically lead to additional price gains [7] - Screening parameters include relative price changes over various time frames and positive current-quarter estimate revisions [8] Zacks Rank and Stock Performance - Only Zacks Rank 1 (Strong Buy) stocks, which have historically outperformed the S&P 500, are considered for investment [9] - Specific stocks highlighted include: - **Pediatrix Medical Group (MD)**: Market cap of $1.5 billion, 51.8% share price increase over the past year, and a 9.3% upward revision in earnings estimates [11][12] - **Enova International (ENVA)**: Market cap of $2.9 billion, 37.4% share price increase, and a 32.4% growth estimate for 2025 earnings [13][14] - **Primoris Services Corporation (PRIM)**: Market cap not specified, 107.7% share price increase, and a 20.7% growth estimate for 2025 earnings [15] - **SkyWest, Inc. (SKYW)**: Market cap of $4.8 billion, 60.4% share price increase, and a 28.1% growth estimate for 2025 earnings [16] - **Agnico Eagle Mines Limited (AEM)**: Market cap of $69 billion, 66% share price increase, and a 62.2% growth estimate for 2025 earnings [17][18]

Core Insights - The article discusses the growing demand for infrastructure solutions in the U.S., particularly for mission-critical projects, and compares two companies, Sterling Infrastructure, Inc. (STRL) and Primoris Services Corporation (PRIM), in this context [2][4]. Company Analysis: Sterling Infrastructure, Inc. (STRL) - Sterling is diversifying its revenue by focusing on public infrastructure, especially mission-critical data centers and manufacturing [3]. - As of June 30, 2025, Sterling's E-Infrastructure Solutions backlog increased by 44% year-over-year to $1.2 billion, with revenues in this segment growing by 24.2% to $528.7 million, contributing 51% to total revenues [6]. - The total backlog for Sterling reached $2.01 billion, with a backlog margin of 17.8%, up from $1.69 billion at the end of 2024 [6]. - Sterling's acquisition of CEC Facilities Group, expected to close by Q3 2025, is anticipated to enhance its capabilities in mission-critical services [7][8]. - The company is strategically shifting towards large mission-critical projects due to weaknesses in the housing market, focusing on disciplined bidding and efficient execution [5]. Company Analysis: Primoris Services Corporation (PRIM) - Primoris specializes in constructing utility-scale power generation resources and is expanding its market exposure in data center infrastructure [9]. - As of June 30, 2025, Primoris' total backlog increased by 10% year-over-year to $11.49 billion, with $1.7 billion in data center work under evaluation for 2025 contracts [10][11]. - Primoris plans to submit bids for over $2.5 billion in natural gas generation projects and has solar projects worth $20-$30 billion planned through 2028 [11]. - Currently, only 10% of Primoris' revenues are tied to data center projects, indicating potential for revenue diversification [12]. Stock Performance & Valuation - In the past three months, Primoris' share price performance has outperformed Sterling's within the broader construction sector [13]. - Over the last five years, Sterling has traded at a premium valuation compared to Primoris on a forward 12-month price-to-earnings (P/E) ratio basis [14]. - Primoris offers a more attractive valuation with steady multi-year growth prospects, while Sterling shows slower growth with a premium valuation [15]. Earnings Estimates - The Zacks Consensus Estimate for STRL's 2025 EPS indicates a year-over-year growth of 45.9%, with a 9.4% increase projected for 2026 [18]. - For PRIM, the 2025 and 2026 earnings estimates imply year-over-year improvements of 20.7% and 12.1%, respectively [20]. Investment Consideration - Sterling's focus on mission-critical projects and strong backlog growth supports long-term visibility, but its premium valuation suggests optimism is already priced in [21]. - Primoris, with a larger backlog and aggressive expansion into high-growth markets, presents a more compelling buy opportunity due to its discounted valuation and stronger relative share performance [22].