Construction and Maintenance Services Stocks Q2 Recap: Benchmarking MYR Group (NASDAQ:MYRG)

Wrapping up Q2 earnings, we look at the numbers and key takeaways for the construction and maintenance services stocks, including MYR Group (NASDAQ:MYRG) and its peers.

Construction and maintenance services companies not only boast technical know-how in specialized areas but also may hold special licenses and permits. Those who work in more regulated areas can enjoy more predictable revenue streams - for example, fire escapes need to be inspected every five years–. More recently, services to address energy efficiency and labor availability are also creating incremental demand. But like the broader industrials sector, construction and maintenance services companies are at the whim of economic cycles as external factors like interest rates can greatly impact the new construction that drives incremental demand for these companies’ offerings.

The 13 construction and maintenance services stocks we track reported a mixed Q2. As a group, revenues missed analysts’ consensus estimates by 1% while next quarter’s revenue guidance was 2% below.

The Fed cut its policy rate by 50bps (half a percent) in September 2024, the first in roughly four years. This marks the end of its most pointed inflation-busting campaign since the 1980s. While CPI (inflation) readings have been supportive lately, employment measures have bordered on worrisome. The markets will be assessing whether this rate cut's timing (and more potential ones in 2024 and 2025) is ideal for supporting the economy or a bit too late for a macro that has already cooled too much.

Luckily, construction and maintenance services stocks have performed well with share prices up 10.2% on average since the latest earnings results.

MYR Group (NASDAQ:MYRG)

Constructing electrical and phone lines in the American Midwest dating back to the 1890s, MYR Group (NASDAQ:MYRG) is a specialty contractor in the electrical construction industry.

MYR Group reported revenues of $828.9 million, down 6.7% year on year. This print fell short of analysts’ expectations by 5.4%. Overall, it was a slower quarter for the company with a miss of analysts’ earnings estimates.

Unsurprisingly, the stock is down 29% since reporting and currently trades at $99.19.

Read our full report on MYR Group here, it’s free.

Best Q2: Great Lakes Dredge & Dock (NASDAQ:GLDD)

Founded as Lydon & Drews dredging company, Great Lakes Dredge & Dock (NASDAQ:GLDD) provides dredging services, land reclamation, and coastal protection projects in the United States and internationally.

Great Lakes Dredge & Dock reported revenues of $170.1 million, up 28.2% year on year, outperforming analysts’ expectations by 3.5%. The business had an incredible quarter with an impressive beat of analysts’ earnings estimates.

The market seems happy with the results as the stock is up 30.5% since reporting. It currently trades at $10.57.

Is now the time to buy Great Lakes Dredge & Dock? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Orion (NYSE:ORN)

Established in 1994, Orion (NYSE:ORN) provides construction services for marine infrastructure and industrial projects.

Orion reported revenues of $192.2 million, up 5.3% year on year, falling short of analysts’ expectations by 3.4%. It was a disappointing quarter as it posted a miss of analysts’ earnings estimates.

As expected, the stock is down 40.2% since the results and currently trades at $6.61.

Read our full analysis of Orion’s results here.

Comfort Systems (NYSE:FIX)

Having historically grown through organic means as well as acquisitions of numerous peers and competitors, Comfort Systems USA (NYSE:FIX) provides mechanical and electrical contracting services.

Comfort Systems reported revenues of $1.81 billion, up 39.6% year on year. This result surpassed analysts’ expectations by 6.9%. It was a strong quarter as it also produced an impressive beat of analysts’ operating margin and earnings estimates.

Comfort Systems scored the fastest revenue growth among its peers. The stock is up 31.7% since reporting and currently trades at $385.16.

Read our full, actionable report on Comfort Systems here, it’s free.

Construction Partners (NASDAQ:ROAD)

Founded in 2001, Construction Partners (NASDAQ:ROAD) is a civil infrastructure company that builds and maintains roads, highways, and other infrastructure projects.

Construction Partners reported revenues of $517.8 million, up 22.7% year on year. This result surpassed analysts’ expectations by 2.7%. Overall, it was an exceptional quarter as it also recorded an impressive beat of analysts’ organic revenue estimates.

The stock is up 24.6% since reporting and currently trades at $72.53.

Read our full, actionable report on Construction Partners here, it’s free.

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