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Primoris Services Corporation (PRIM) Hit a 52 Week High, Can the Run Continue?
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Have you been paying attention to shares of Primoris Services (PRIM - Free Report) ? Shares have been on the move with the stock up 7.3% over the past month. The stock hit a new 52-week high of $59.16 in the previous session. Primoris Services has gained 71.9% since the start of the year compared to the 21.2% move for the Zacks Construction sector and the 70% return for the Zacks Building Products - Heavy Construction industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on August 5, 2024, Primoris Services reported EPS of $1.04 versus consensus estimate of $0.65.
Valuation Metrics
Primoris Services may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Primoris Services has a Value Score of B. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 20.2X current fiscal year EPS estimates, which is not in-line with the peer industry average of 20.6X. On a trailing cash flow basis, the stock currently trades at 11.6X versus its peer group's average of 12.3X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Primoris Services currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Primoris Services meets the list of requirements. Thus, it seems as though Primoris Services shares could still be poised for more gains ahead.
How Does PRIM Stack Up to the Competition?
Shares of PRIM have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is MasTec, Inc. (MTZ - Free Report) . MTZ has a Zacks Rank of # 2 (Buy) and a Value Score of B, a Growth Score of A, and a Momentum Score of D.
Earnings were strong last quarter. MasTec, Inc. beat our consensus estimate by 9.09%, and for the current fiscal year, MTZ is expected to post earnings of $3.02 per share on revenue of $12.46 billion.
Shares of MasTec, Inc. have gained 3.9% over the past month, and currently trade at a forward P/E of 38.79X and a P/CF of 12.57X.
The Building Products - Heavy Construction industry is in the top 4% of all the industries we have in our universe, so it looks like there are some nice tailwinds for PRIM and MTZ, even beyond their own solid fundamental situation.
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Have you been paying attention to shares of Primoris Services (PRIM - Free Report) ? Shares have been on the move with the stock up 7.3% over the past month. The stock hit a new 52-week high of $59.16 in the previous session. Primoris Services has gained 71.9% since the start of the year compared to the 21.2% move for the Zacks Construction sector and the 70% return for the Zacks Building Products - Heavy Construction industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on August 5, 2024, Primoris Services reported EPS of $1.04 versus consensus estimate of $0.65.
Valuation Metrics
Primoris Services may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Primoris Services has a Value Score of B. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 20.2X current fiscal year EPS estimates, which is not in-line with the peer industry average of 20.6X. On a trailing cash flow basis, the stock currently trades at 11.6X versus its peer group's average of 12.3X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Primoris Services currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Primoris Services meets the list of requirements. Thus, it seems as though Primoris Services shares could still be poised for more gains ahead.
How Does PRIM Stack Up to the Competition?
Shares of PRIM have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is MasTec, Inc. (MTZ - Free Report) . MTZ has a Zacks Rank of # 2 (Buy) and a Value Score of B, a Growth Score of A, and a Momentum Score of D.
Earnings were strong last quarter. MasTec, Inc. beat our consensus estimate by 9.09%, and for the current fiscal year, MTZ is expected to post earnings of $3.02 per share on revenue of $12.46 billion.
Shares of MasTec, Inc. have gained 3.9% over the past month, and currently trade at a forward P/E of 38.79X and a P/CF of 12.57X.
The Building Products - Heavy Construction industry is in the top 4% of all the industries we have in our universe, so it looks like there are some nice tailwinds for PRIM and MTZ, even beyond their own solid fundamental situation.