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Can EMCOR RPOs Support Stable Revenue Visibility Heading Into 2026?
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Key Takeaways
EME's RPO growth reflects rising project awards across infrastructure, healthcare and manufacturing markets.
Network & Communications RPOs saw the biggest gains, driven by increased data center-related activity.
Longer-duration contracts are extending backlog timelines and supporting steadier revenue planning.
U.S. construction activity is strengthening as federal infrastructure initiatives and data center developments increasingly translate into on-the-ground project execution. EMCOR Group, Inc. (EME - Free Report) is operating within this supportive environment, where multi-year funding under the Infrastructure Investment and Jobs Act, alongside state and municipal matching programs, is sustaining demand for engineering, construction, and specialty services tied to infrastructure, healthcare, manufacturing and mission-critical facilities.
Against this backdrop, EMCOR’s Remaining Performance Obligations (“RPO”) play a central role in supporting revenue stability heading into 2026. A sizable and diversified RPO base reflects contracted work across multiple end markets, providing visibility into future activity while allowing the company to allocate labor and resources toward higher-return opportunities as conditions evolve.
In the third quarter of 2025, the company reported record RPO levels, underscoring broad-based strength across Network & Communications, healthcare, manufacturing, and water and wastewater markets. RPOs as of Sept. 30, 2025 rose year over year to $12.61 billion from $9.79 billion, with Network & Communications contributing the largest increase, nearly doubling year over year. Healthcare and manufacturing RPOs also expanded, supported by acquisition-driven capabilities and onshoring-related demand, while water and wastewater benefited from continued project awards in Florida.
The expanding mix of multi-year projects enhances revenue visibility beyond the near term. Supported by easing financial conditions, including recent Federal Reserve rate cuts and the potential for further easing in 2026, project financing conditions remain constructive. Together, these factors position EMCOR’s RPO profile to support steady revenue conversion and improved visibility as the company enters 2026.
Peer Backlogs Reinforce Revenue Visibility
Rising infrastructure and data center investment is also strengthening revenue visibility for EMCOR’s closest peers, particularly Quanta Services, Inc. (PWR - Free Report) and Sterling Infrastructure, Inc. (STRL - Free Report) . Both companies are benefiting from expanding project pipelines tied to power, grid modernization and mission-critical development.
Quanta continues to see demand momentum build as it supports essential power, transmission and grid infrastructure across the United States. In the third quarter of 2025, the company reported a record backlog of $39.2 billion, up from $33.96 billion a year ago, reflecting strong visibility across generation, battery storage, transmission and underground projects. This diversified mix of utility services and large-scale programs provides a long execution runway heading into 2026.
Sterling is similarly enhancing forward visibility through its exposure to large, multi-phase projects. In the third quarter of 2025, the company reported a signed backlog of roughly $2.6 billion, up 64% year over year, with total potential work exceeding $4 billion when including future phases. Its E-Infrastructure focus supports durable, long-term activity.
EMCOR Stock’s Price Performance vs. Other Market Players
Shares of this Connecticut-based infrastructure service provider have gained 18% in the past six months, underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the broader Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
During the past six months, shares of Quanta and Sterling have gained 35.6% and 13.7%, respectively.
EME’s Valuation Trend
EME stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 22.86, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EME
Estimate for EME’s 2026 earnings have trended upward in the past 60 days to $27.41 per share. The revised estimate 2026 indicates year-over-year growth of 17.3%.
Image: Bigstock
Can EMCOR RPOs Support Stable Revenue Visibility Heading Into 2026?
Key Takeaways
U.S. construction activity is strengthening as federal infrastructure initiatives and data center developments increasingly translate into on-the-ground project execution. EMCOR Group, Inc. (EME - Free Report) is operating within this supportive environment, where multi-year funding under the Infrastructure Investment and Jobs Act, alongside state and municipal matching programs, is sustaining demand for engineering, construction, and specialty services tied to infrastructure, healthcare, manufacturing and mission-critical facilities.
Against this backdrop, EMCOR’s Remaining Performance Obligations (“RPO”) play a central role in supporting revenue stability heading into 2026. A sizable and diversified RPO base reflects contracted work across multiple end markets, providing visibility into future activity while allowing the company to allocate labor and resources toward higher-return opportunities as conditions evolve.
In the third quarter of 2025, the company reported record RPO levels, underscoring broad-based strength across Network & Communications, healthcare, manufacturing, and water and wastewater markets. RPOs as of Sept. 30, 2025 rose year over year to $12.61 billion from $9.79 billion, with Network & Communications contributing the largest increase, nearly doubling year over year. Healthcare and manufacturing RPOs also expanded, supported by acquisition-driven capabilities and onshoring-related demand, while water and wastewater benefited from continued project awards in Florida.
The expanding mix of multi-year projects enhances revenue visibility beyond the near term. Supported by easing financial conditions, including recent Federal Reserve rate cuts and the potential for further easing in 2026, project financing conditions remain constructive. Together, these factors position EMCOR’s RPO profile to support steady revenue conversion and improved visibility as the company enters 2026.
Peer Backlogs Reinforce Revenue Visibility
Rising infrastructure and data center investment is also strengthening revenue visibility for EMCOR’s closest peers, particularly Quanta Services, Inc. (PWR - Free Report) and Sterling Infrastructure, Inc. (STRL - Free Report) . Both companies are benefiting from expanding project pipelines tied to power, grid modernization and mission-critical development.
Quanta continues to see demand momentum build as it supports essential power, transmission and grid infrastructure across the United States. In the third quarter of 2025, the company reported a record backlog of $39.2 billion, up from $33.96 billion a year ago, reflecting strong visibility across generation, battery storage, transmission and underground projects. This diversified mix of utility services and large-scale programs provides a long execution runway heading into 2026.
Sterling is similarly enhancing forward visibility through its exposure to large, multi-phase projects. In the third quarter of 2025, the company reported a signed backlog of roughly $2.6 billion, up 64% year over year, with total potential work exceeding $4 billion when including future phases. Its E-Infrastructure focus supports durable, long-term activity.
EMCOR Stock’s Price Performance vs. Other Market Players
Shares of this Connecticut-based infrastructure service provider have gained 18% in the past six months, underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the broader Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
During the past six months, shares of Quanta and Sterling have gained 35.6% and 13.7%, respectively.
EME’s Valuation Trend
EME stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 22.86, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EME
Estimate for EME’s 2026 earnings have trended upward in the past 60 days to $27.41 per share. The revised estimate 2026 indicates year-over-year growth of 17.3%.
Image Source: Zacks Investment Research
EMCOR stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.