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What's in Store for Primoris Services' (PRIM) Q3 Earnings?

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Primoris Services Corporation (PRIM - Free Report) is slated to report third-quarter 2020 results on Nov 6, before the opening bell.

In the last reported quarter, the company’s earnings and revenues beat the Zacks Consensus Estimate by 94.3% and 1.7%, respectively. Also, earnings and revenues grew 94.3% and 15% from the respective year-ago reported figures.

The company’s earnings topped the consensus mark in two of the last four quarters and missed on the other two occasions, with the average negative surprise being 2%.

Earnings & Revenue Expectations

The Zacks Consensus Estimate for Primoris’ third-quarter earnings is pegged at 67 cents per share, implying a 4.3% decline from a year ago. The consensus estimate for revenues is $915.2 million, indicating 5.8% year-over-year growth.

Factors to Note

The company’s revenues are expected to have increased in the third quarter, courtesy of higher demand from gas and electric utility markets, and the solar market. Segment wise, headwinds related to global demand created by the pandemic and low energy prices could have resulted in some revenue softness in the third quarter for the Civil segment. For the Power, Industrial, & Engineering segment, solid performance in the renewables market backed by tailwinds such as state renewable energy mandates and the push for clean energy continued to drive growth. However, volatility in energy markets and challenging industrial markets are likely to reflect on the segment’s quarterly results.

For the Utilities & Distribution segment, multiple awards on a major pipeline replacement project with a large utility are likely to aid the segment’s results. Meanwhile, for the Transmission & Distribution segment, cost-reduction initiatives and improved execution are expected to have boosted margins. Finally, for the Pipeline & Underground segment — accounting for 31.9% of total revenues — is expected to have benefited from new awards. Greater activities for smaller-diameter interstate pipeline work are expected to have acted as tailwinds.

What Our Quantitative Model Predicts

Our proven model does not conclusively predict an earnings beat for Primoris this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Primoris — which shares space with Dycom Industries Inc. (DY - Free Report) , EMCOR Group Inc. (EME - Free Report) and MasTec Inc. (MTZ - Free Report) in the Zacks Building Products - Heavy Construction industry — currently carries a Zacks Rank #3.

You can see the complete list of today’s Zacks #1 Rank stocks here.

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