Comfort Systems USA

Comfort Systems USA, Inc. (FIX - Snapshot Report) has performed well against the broader market. Earnings for this Growth and Income pick are expected to grow by 14% over the next 3 – 5 years, which is in line with the industry average.

Company Description

Comfort Systems USA provides commercial and industrial heating, ventilation and air conditioning (HVAC) and building automation services. Headquartered in Houston, Texas and with more than 85 locations nationwide, the company is able to deliver high quality engineering, design, installation, energy assessment as well as repair and maintenance services across the U.S.

Even in a slowing construction environment, customers from the healthcare, academic and military sectors, which represent about a quarter of Comfort Systems’ revenue and are not showing signs of sluggishness, are helping FIX continue to grow amid otherwise tough conditions. These sectors are continuing to build in spite of the residential and commercial slowdowns.

Higher Forecasts

The company has seen upward earnings estimate revisions from the analyst community. Earnings estimates for the current year increased from the three months-ago forecasts of $1.17 per share to $1.25.

Earnings for this Growth and Income pick are expected to grow by 14% over the next 3 – 5 years, which is in line with the industry average.

Recent Events

The company recently increased its stock repurchase program and bought Delcard Associates, Inc. ("Delcard"), a full service commercial HVAC company based in Wilmington, Delaware.

Comfort Systems said Delcard had 2007 revenues of approximately $45 million, adding that it believes Delcard will make a strong contribution to continuing operations.

Income

In late July, FIX declared a quarterly dividend of $0.045 per share. The company noted that the dividend is payable on September 19, 2008 to shareholders of record at the close of business on August 29, 2008.

Growth

The company also announced second-quarter results in late July. Earnings per share of 38 cents topped the year-prior 25 cents and exceeded the consensus estimate 15%.

Comfort Systems USA's Chairman and CEO Bill Murdy commented, "We are mindful of economic and financial challenges that confront the economy. In light of the consistency of our cash flows, the strength demonstrated in our backlog, and our recent success in bringing strong new operations and their excellent teams into the Comfort Systems USA family, we remain optimistic about the second half of 2008. Even if a significant nonresidential construction recession becomes fact, we believe that we can continue to demonstrate impressive profitability and growth to the fundamental value of Comfort Systems USA."