Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at Matrix Service (NASDAQ: MTRX) 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 strong Q2. As a group, revenues beat analysts’ consensus estimates by 3.5% while next quarter’s revenue guidance was in line.
Luckily, construction and maintenance services stocks have performed well with share prices up 12.1% on average since the latest earnings results.
Weakest Q2: Matrix Service (NASDAQ: MTRX)
Founded in Oklahoma, Matrix Service (NASDAQ: MTRX) provides engineering, fabrication, construction, and maintenance services primarily to the energy and industrial markets.
Matrix Service reported revenues of $216.4 million, up 14.2% year on year. This print fell short of analysts’ expectations by 6.8%. Overall, it was a disappointing quarter for the company with full-year revenue guidance missing analysts’ expectations and a significant miss of analysts’ EBITDA estimates.
“During the fourth quarter, we had continued momentum across multiple large projects, driving 14% year-over-year revenue growth and improved fixed cost absorption,” stated John Hewitt, President and Chief Executive Officer of Matrix Service Company.
Matrix Service delivered the weakest performance against analyst estimates and weakest full-year guidance update of the whole group. Unsurprisingly, the stock is down 7.2% since reporting and currently trades at $13.21.
Read our full report on Matrix Service here, it’s free.
Best Q2: Primoris (NYSE: PRIM)
Listed on the NASDAQ in 2008, Primoris (NYSE: PRIM) builds, maintains, and upgrades infrastructure in the utility, energy, and civil construction industries.
Primoris reported revenues of $1.89 billion, up 20.9% year on year, outperforming analysts’ expectations by 12.1%. The business had an incredible quarter with a beat of analysts’ EPS and EBITDA estimates.
Primoris delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 44.9% since reporting. It currently trades at $135.
Is now the time to buy Primoris? Access our full analysis of the earnings results here, it’s free.
WillScot Mobile Mini (NASDAQ: WSC)
Originally focusing on mobile offices for construction sites, WillScot (NASDAQ: WSC) provides ready-to-use temporary spaces, largely for longer-term lease.
WillScot Mobile Mini reported revenues of $589.1 million, down 2.6% year on year, in line with analysts’ expectations. It was a softer quarter as it posted a significant miss of analysts’ adjusted operating income and EPS estimates.
As expected, the stock is down 21.3% since the results and currently trades at $23.11.
Read our full analysis of WillScot Mobile Mini’s results here.
Concrete Pumping (NASDAQ: BBCP)
Going public via SPAC in 2018, Concrete Pumping (NASDAQ: BBCP) is a provider of concrete pumping and waste management services in the United States and the United Kingdom.
Concrete Pumping reported revenues of $103.7 million, down 5.4% year on year. This result topped analysts’ expectations by 3.3%. It was a strong quarter as it also put up full-year EBITDA guidance exceeding analysts’ expectations.
Concrete Pumping had the slowest revenue growth among its peers. The stock is up 6.9% since reporting and currently trades at $7.26.
Read our full, actionable report on Concrete Pumping here, it’s free.
APi (NYSE: APG)
Started in 1926 as an insulation contractor, APi (NYSE: APG) provides life safety solutions and specialty services for buildings and infrastructure.
APi reported revenues of $1.99 billion, up 15.1% year on year. This number surpassed analysts’ expectations by 5.1%. Overall, it was a very strong quarter as it also produced an impressive beat of analysts’ organic revenue estimates and full-year revenue guidance exceeding analysts’ expectations.
The stock is up 3.5% since reporting and currently trades at $35.66.
Read our full, actionable report on APi here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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