Everus Construction Group, Inc. (ECG Quick QuoteECG - Free Report) raised its 2026 guidance following record third-quarter revenues, earnings and backlog, supported by robust data center demand, strong organic growth and disciplined project execution.

During the third-quarter 2026 earnings call, management emphasized expanding opportunities across electrical and mechanical construction, acquisitions and operational efficiency. Executives also addressed analyst concerns about data center construction risks, backlog conversion, skilled labor availability and margin sustainability heading into 2027.

ECG Maintains Its Growth and Capital Allocation Focus

Everus reported earnings of $1.79 per share, exceeding the Zacks Consensus Estimate of $1.28. Revenues reached $1.38 billion, surpassing the Zacks Consensus Estimate of $1.18 billion by 16.60%.

Everus Construction Group, Inc. Price, Consensus and EPS Surprise

Everus Construction Group, Inc. price-consensus-eps-surprise-chart | Everus Construction Group, Inc. Quote

Management maintained its emphasis on organic investment, acquisitions and disciplined execution. With net leverage at 0.7 times, below its targeted range of 1.5-2 times, Everus retains financial flexibility to pursue growth opportunities.

Everus Raises 2026 Guidance on Strong Demand

Chief Financial Officer Maximillian Marcy raised Everus' 2026 revenue guidance to $5 billion-$5.1 billion from the previous range of $4.5 billion-$4.7 billion.

The company increased its EBITDA outlook to $485 million-$495 million from $410 million-$425 million. The revised midpoint implies an EBITDA margin of approximately 9.7%.

Marcy attributed the improved outlook to strong operating performance, sustained demand and contributions from the Epsilon acquisition. Management maintained its capital expenditure forecast of $90 million-$100 million.

ECG's Record Backlog Supports Growth Visibility

President and CEO Jeff Thiede highlighted record backlog of $5.48 billion, increasing 86.1% year over year, reflecting broad-based demand and contributions from acquisitions.

Data centers remained the largest backlog component, supported by strong relationships with hyperscale customers. Thiede emphasized continued involvement in customer planning activities that extend beyond existing contracted projects.

Demand also strengthened across semiconductor, manufacturing, government and health care projects. Management highlighted improving utility investment opportunities, supported by aging infrastructure and anticipated electricity load growth.

Everus Expands Modular Construction Capabilities

Thiede emphasized the strategic importance of acquiring SE&M and Epsilon, which expand Everus' geographic footprint, customer relationships and construction capabilities.

The September acquisition of Epsilon strengthened off-site modular construction and prefabrication operations. Management expects opportunities to cross-sell services across existing customer relationships.

During Q&A, Oppenheimer questioned Epsilon's backlog conversion. Marcy explained that modular construction projects generally convert more slowly than traditional construction work, while Thiede reiterated the company's historical 80% backlog conversion rate over 12 months.

ECG Addresses Data Center Construction Risks

During the analyst Q&A, D.A. Davidson questioned whether changing political conditions and potential data center construction restrictions could affect project activity.

Thiede indicated that Everus had observed no changes in customer behavior. He emphasized continued engagement with hyperscale customers and confidence in the industry's project pipeline.

Management also stressed diversification across industrial, institutional and utility markets. Thiede noted that increasing opportunities in semiconductor manufacturing, health care and other construction categories complement the company's substantial data center exposure.

Everus Focuses on Margins and Labor Productivity

Marcy highlighted continued execution improvements, with third-quarter EBITDA reaching $140.2 million and EBITDA margin expanding 110 basis points to 10.1%.

During Q&A, Cantor Fitzgerald questioned margin sustainability after adjusting for a $7.6 million one-time benefit from settling prior project billings. Marcy emphasized improvements in underlying margins alongside favorable project execution, while deferring formal 2027 guidance until February.

Cantor Fitzgerald also questioned skilled labor availability. Marcy acknowledged long-term industry labor challenges but emphasized prefabrication and modular construction as methods for supporting revenue growth without proportionate workforce expansion.

ECG's Zacks Rank and Style Scores Indicate Mixed Prospects

Everus currently carries a Zacks Rank #3 (Hold), reflecting a neutral near-term earnings estimate revision outlook. Its Growth Score of A indicates favorable growth characteristics, while its Value Score of C reflects less compelling valuation characteristics. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Momentum Score of B indicates favorable price momentum, while the VGM Score of A reflects an attractive combined assessment of value, growth and momentum. These favorable style characteristics complement the stock's neutral Zacks Rank.

The Zacks Rank can change as analysts revise earnings estimates following the latest quarterly results and updated management guidance. The combination of Rank and Style Scores provides complementary indicators rather than definitive predictions of future stock performance.