EMCOR Group, Inc. EME continues to expand its presence across construction and services through targeted acquisitions. The company has positioned itself to capture demand in diverse end-markets, from data centers and healthcare facilities to institutional projects. By broadening capabilities, EMCOR is working to reduce dependency on specific sectors and strengthen long-term growth prospects.
During the first six months of 2025, acquisitions contributed $581.2 million to total revenues, with Miller Electric providing the largest share. As of the second quarter end, EMCOR spent $887.2 million on M&A. As of June 30, 2025, Remaining Performance Obligations (“RPO”) reached $11.91 billion, reflecting 22% year-over-year organic growth and a 32.4% rise including Miller Electric’s contribution. This rising RPO highlights the company’s growing exposure to high-demand areas, like network infrastructure, manufacturing and institutional markets.
The Federal Reserve recently reduced its key lending rate by 25 basis points, setting the target range at 4% to 4.25%. This was the first cut since last December, with signals of two more cuts possible this year. Lower financing costs are expected to spur investment in large-scale projects, supporting demand in the industrial and institutional markets EMCOR serves.
Overall, EMCOR’s acquisition strategy is helping to expand both scale and scope. With a strong balance sheet and rising RPO, the company appears positioned to use these acquisitions as a lever to build resilience across sectors while capturing new growth opportunities.
Backlog Strength Highlights Momentum in the Sector
Strong backlog levels are creating momentum in the construction and services space. Primoris Services Corporation PRIM and MasTec, Inc. MTZ are seeing growing demand tied to digital infrastructure, with data centers and communications projects driving expansion.
Primoris is sharpening its focus on infrastructure growth, with data centers emerging as a key driver. In the second quarter of 2025, revenues rose 20.9% year over year to $1.89 billion, supported by strength in Energy and Utilities. The company is pursuing more than $1.7 billion of data center projects, which it views as a natural extension of core capabilities. With backlog climbing to $11.5 billion, Primoris is positioned to capture opportunities tied to digital transformation and AI-driven capacity needs.
MasTec is also expanding in high-demand areas, particularly through fiber deployment linked to hyperscaler spending. Communications revenues surged 42% year over year in the second quarter of 2025, supported by broadband build-outs and telecom infrastructure tied to data centers. As of June 30, 2025, MasTec reported an 18-month backlog of $16.45 billion, reflecting a 23.3% year-over-year increase and 4% sequential growth. This strength led the company to raise its 2025 guidance.
EME’s Price Performance, Valuation & Estimates
Shares of EMCOR have gained 58.9% in the past three months compared with the Zacks Building Products - Heavy Construction industry’s growth of 55.4%.
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From a valuation standpoint, EME trades at a forward 12-month price-to-earnings ratio of 24.76X, up from the industry’s 23X.
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EMCOR’s earnings estimates for 2025 and 2026 have trended upward in the past 30 days by 2.4% to $25.11 per share and 2.9% to $27, respectively. The estimated figures for 2025 and 2026 indicate 16.7% and 7.5% year-over-year growth, respectively.
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EME’s Zacks Rank
EMCOR currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
