EME  Emcor Group Inc.

Exchange

NYSE

Sector

Capital Goods

Industry

Engineering & Construction

Market Cap.

3.75B

Vuru Grade

63.24/100

Current Price

$61.94
+0.31 (+0.50%)

Growth Price

$42.61
Overvalued by 31.21%

Stability Price

$129.15
Undervalued by 108.51%

Company Metrics

  • P/E 20.86
  • P/S 0.49
  • P/B 2.42
  • EPS 2.97
  • Cash ROIC 11.10%
  • Cash Ratio 0.34
  • Dividend 0.32 / 0.52%
  • Avg. Vol. 411,326.00
  • Shares 60.54M
  • Market Cap. 3.75B

Company Description

EMCOR Group, Inc., together with its subsidiaries, provides electrical and mechanical construction and facilities services worldwide. It engages in the design, integration, installation, start-up, operation, and maintenance of various electrical and mechanical systems, including electric power transmission and distribution systems, such as power cables, conduits, distribution panels, transformers,... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

EMCOR Group Inc. (EME) Moves Higher on Volume Spike for February 24
Equities.com - Feb 24, 2017
EMCOR Group Inc. (EME) traded on unusually high volume on Feb. 24, as the stock gained 0.5% to close at $61.94. On the day, EMCOR Group Inc. saw 995,679 shares trade hands on 8,269 trades. Considering that the stock averages only a daily volume of ...
EMCOR Group, Inc. Reports Fourth Quarter and Full-Year 2016 Results - Business Wire (press release)
Analyst Upgrades – EMCOR Group (NYSE:EME) Stock Gets Upgraded By Stifel ... - Market Exclusive
EMCOR Group Enters Oversold Territory
Nasdaq - Feb 23, 2017
In trading on Thursday, shares of EMCOR Group, Inc. (Symbol: EME) entered into oversold territory, hitting an RSI reading of 24.7, after changing hands as low as $61.26 per share.
What's in the Cards for EMCOR (EME) this Earnings Season?
Zacks.com - Feb 20, 2017
EMCOR Group, Inc. (EME - Free Report) is set to report fourth-quarter 2016 results, before the opening bell on Feb 23.
EMCOR Group, Inc. (EME) Scheduled to Post Earnings on Thursday - Sports Perspectives
EMCOR Group, Inc. (EME) Receives Neutral Rating from DA Davidson - Chaffey Breeze
EMCOR Group Inc (NYSE:EME) Stock Technicals Hit Weakness
CML News - Feb 23, 2017
This is a technical analysis stock rating for EMCOR Group Inc (NYSE:EME) . The company has a two bull technical rating which indicates some weakness.
Moody's says Energy Services Holdings' ratings unaffected at this time ...
Moodys.com (press release) (subscription) - Mar 25, 2016
New York, March 24, 2016 -- Moody's Investors Service said that EMCOR Group, Inc.'s (EMCOR, rated Ba1) announcement that it will acquire Ardent Services and Rabalais Constructors, two primary subsidiaries of Energy Services Holdings, will have no ...
EMCOR Group Announces Dividend, Shares Rise (EME)
Investopedia - Oct 6, 2016
EME will search for ways to "expand the breadth of [its] service offerings and [its] geographic reach," Guzzi said. The company boasts a "healthy balance sheet," Guzzi noted, and remains in a strong position to capitalize on both organic and ...
Is It Time to go for PRA Health Sciences (PRAH), EMCOR Group, Inc. (EME)?
StockNewsJournal - Feb 24, 2017
EMCOR Group, Inc. (NYSE:EME), maintained return on investment for the last twelve months at 8.37, higher than what Reuters data shows regarding industry's average.
EMCOR Group, Inc. Declares Regular Quarterly Dividend
Business Wire (press release) - Jan 5, 2017
NORWALK, Conn.--(BUSINESS WIRE)--EMCOR Group, Inc. (NYSE: EME) today announced that its Board of Directors has declared a regular quarterly cash dividend of $0.08 per common share.
EMCOR Group, Inc. (EME) Announces Quarterly Dividend of $0.08 - The Cerbat Gem
Option Market: EMCOR Group Inc Risk Hits A Depressed Level
CML News - Feb 21, 2017
We're going to look at a proprietary risk rating for the next 30-days built by Capital Market Laboratories (CMLviz) based on a large number of interactions of data points, many of which come directly from the option market for EMCOR Group Inc (NYSE:EME) .
Stock Returns: MasTec Inc (NYSE:MTZ) is Beating EMCOR Group Inc (NYSE:EME)
CML News - Feb 16, 2017
This is a snapshot to compare the stock returns for EMCOR Group Inc (NYSE:EME) versus MasTec Inc (NYSE:MTZ) . The stock return points we compare look at the last three-months, six-months and twelve-months.
Martingale Asset Management LP Buys 1487 Shares of EMCOR Group, Inc. (EME) - Sports Perspectives
EMCOR Group, Inc. (NYSE:EME) Receives An Update From Brokers - The De Soto Edge
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for EME to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate EME's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$61.94 Current Price

$42.61 Growth Price (DCF)

Overvalued by 31.21%


Growth Rate Assumed by Market: 10.59%


Future Free Cash Flow Growth Rate: -7.9%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$129.15 Stability Price (EPV)

Undervalued by 108.51%


Discount Rate: 15.0%

$44.86 Book Price

Overvalued by 27.58%


Satisfactory Cash Return on Invested Capital over the past 5 years

EME has somewhat efficiently invested its financial resources in buildings, projects, and equipment. If CROIC is inconsistent, it's likely EME could be benefiting from a one-time event or has a mixed history of investing capital productively. Read the company's Annual Report to determine whether this can improve.

EME has created $11.10 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20112012201320142015
Free Cash Flow 119.84M 146.53M 114.57M 208.62M 231.21M
divided by
Invested Capital 1.17B 1.21B 1.73B 1.67B 1.65B
Cash ROIC 10.23% 12.14% 6.63% 12.47% 14.05%

Satisfactory Return on Equity over the past 5 years

EME has generated adequate returns with capital that shareholders have invested. This is sufficient and implies that management performance has been good.

EME has generated $10.90 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20112012201320142015
Net Income 133.67M 148.89M 127.35M 173.43M 172.51M
divided by
Stockholders' Equity 1.23B 1.35B 1.47B 1.42B 1.48B
Return on Equity 10.83% 11.06% 8.69% 12.25% 11.68%

Excellent Business Performance over the past 10 years

EME has been able to maintain profitability in good times and bad. This could mean EME has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

EME has created positive free cash flow for 9 or more of the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Free Cash Flow 189.61M 237.52M 297.51M 335.01M 49.29M 119.84M 146.53M 114.57M 208.62M 231.21M

Weak Balance Sheet

EME's financial position is not ideal. The key is to check whether EME is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Cash 273.74M 251.64M 405.87M 726.98M 710.84M 511.32M 605.30M 439.81M 432.06M 486.83M
Current Assets 1.66B 1.94B 2.01B 1.98B 1.98B 1.94B 2.04B 1.93B 1.89B 2.07B
Total Assets 2.09B 2.87B 3.01B 2.98B 2.76B 3.01B 3.11B 3.47B 3.39B 3.55B
Current Liabilities 1.21B 1.51B 1.51B 1.33B 1.23B 1.33B 1.29B 1.30B 1.28B 1.41B
Total Liabilities 1.38B 1.99B 1.97B 1.76B 1.60B 1.78B 1.76B 2.00B 1.97B 2.07B
Stockholder' Equity 710.31M 885.04M 1.04B 1.22B 1.15B 1.23B 1.35B 1.47B 1.42B 1.48B
Current Ratio 1.38 1.28 1.33 1.48 1.61 1.46 1.58 1.49 1.47 1.46
TL-to-TA 0.66 0.69 0.65 0.59 0.58 0.59 0.57 0.58 0.58 0.58

Consistent Reinvestment of Profits over the past 10 years

EME has consistently retained profits. This may put EME in a strong position to invest for the future, by buying new machinery, investing in R&D or a number of other options. By effectively using these earnings, EME can greatly improve their long-term economic picture.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Retained Earnings 399.80M 526.31M 708.51M 869.27M 782.58M 910.04M 1.02B 1.13B 1.28B 1.43B
Retained Earnings Growth - 31.64% 34.62% 22.69% -9.97% 16.29% 12.33% 10.92% 12.97% 11.86%

Highly Competitive Industry over the past 10 years

It's likely that EME is in an industry with low barriers to entry, spurring high competition. If Gross Margins are at least satisfactory, it's likely EME invests heavily in R&D and Sales, General & Administrative expenses.

Only $1.98 of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Net Income 86.63M 126.81M 182.20M 163.08M -86.69M 133.67M 148.89M 127.35M 173.43M 172.51M
divided by
Revenue 5.02B 5.93B 6.79B 5.55B 5.12B 5.61B 6.35B 6.42B 6.42B 6.72B
Net Profit Margin 1.73% 2.14% 2.69% 2.94% -1.69% 2.38% 2.35% 1.98% 2.70% 2.57%

Inconsistent Gross Profit Margins over the past 10 years

EME has good gross profit margins, however inconsistency of these margins is a cause for concern. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$21.87 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Gross Profit 567.68M 702.82M 886.65M 824.90M 719.54M 5.61B 806.35M 813.06M 907.25M 944.48M
divided by
Revenue 5.02B 5.93B 6.79B 5.55B 5.12B 5.61B 6.35B 6.42B 6.42B 6.72B
Gross Margin 11.31% 11.86% 13.07% 14.87% 14.05% 100.00% 12.71% 12.67% 14.12% 14.06%

Low Capital Intensity over the past 10 years

EME has consistently used a small portion of their Net Income buying new equipment or investing in new facilities. This indicates that EME may require minimal investment to stay competitive. This leaves them with extra money to spend on growing their business and potentially buying back stock.

21.45% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Capital Expenditure 19.73M 21.50M 37.51M 24.10M 19.36M 29.58M 37.88M 35.50M 38.04M 35.46M
divided by
Net Income 86.63M 126.81M 182.20M 163.08M -86.69M 133.67M 148.89M 127.35M 173.43M 172.51M
Capital Expenditure Ratio 22.78% 16.96% 20.59% 14.78% -22.33% 22.13% 25.44% 27.87% 21.93% 20.56%

Strong Dividend History over the past 10 years

EME has consistently distributed a dividend for the past 7 years. This suggests EME is established and will likely continue to distribute its dividend for the foreseeable future.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Dividend Paid - - - 1.35M 2.50M 5.69M 35.67M 13.38M 26.04M 30.35M
divided by
Shares Outstanding 65.38M 66.74M 67.12M 67.45M 66.39M 68.38M 67.74M 68.08M 67.06M 63.31M
Dividend Paid Per Share - - - 0.02 0.04 0.08 0.53 0.20 0.39 0.48
Price at Year End 28.31 24.44 21.52 27.41 29.21 26.76 34.05 42.20 44.90 48.37
Dividend Yield - - - 0.07% 0.13% 0.31% 1.55% 0.47% 0.86% 0.99%

History of Stock Buybacks over the past 10 years

EME has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Shares Outstanding 65.38M 66.74M 67.12M 67.45M 66.39M 68.38M 67.74M 68.08M 67.06M 63.31M
Stock Bought Back - -2.03% -0.56% -0.49% 1.58% -2.90% 0.94% -0.50% 1.51% 5.93%
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