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Primoris Services Corporation (PRIM) Soars to 52-Week High, Time to Cash Out?
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Have you been paying attention to shares of Primoris Services (PRIM - Free Report) ? Shares have been on the move with the stock up 17.7% over the past month. The stock hit a new 52-week high of $55.48 in the previous session. Primoris Services has gained 65.1% since the start of the year compared to the 8.5% move for the Zacks Construction sector and the 61.2% return for the Zacks Building Products - Heavy Construction industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on May 8, 2024, Primoris Services reported EPS of $0.47 versus consensus estimate of $0.08.
Valuation Metrics
While Primoris Services has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Primoris Services has a Value Score of B. The stock's Growth and Momentum Scores are C and D, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 20.5X current fiscal year EPS estimates, which is a premium to the peer industry average of 19.6X. On a trailing cash flow basis, the stock currently trades at 11.2X versus its peer group's average of 11.4X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Primoris Services currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Primoris Services passes the test. Thus, it seems as though Primoris Services shares could have potential in the weeks and months to come.
How Does PRIM Stack Up to the Competition?
Shares of PRIM have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Great Lakes Dredge & Dock Corporation (GLDD - Free Report) . GLDD has a Zacks Rank of # 1 (Strong Buy) and a Value Score of B, a Growth Score of B, and a Momentum Score of B.
Earnings were strong last quarter. Great Lakes Dredge & Dock Corporation beat our consensus estimate by 416.67%, and for the current fiscal year, GLDD is expected to post earnings of $0.73 per share on revenue of $739.63 million.
Shares of Great Lakes Dredge & Dock Corporation have gained 39.9% over the past month, and currently trade at a forward P/E of 12.73X and a P/CF of 11.61X.
The Building Products - Heavy Construction industry is in the top 1% of all the industries we have in our universe, so it looks like there are some nice tailwinds for PRIM and GLDD, even beyond their own solid fundamental situation.
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Primoris Services Corporation (PRIM) Soars to 52-Week High, Time to Cash Out?
Have you been paying attention to shares of Primoris Services (PRIM - Free Report) ? Shares have been on the move with the stock up 17.7% over the past month. The stock hit a new 52-week high of $55.48 in the previous session. Primoris Services has gained 65.1% since the start of the year compared to the 8.5% move for the Zacks Construction sector and the 61.2% return for the Zacks Building Products - Heavy Construction industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on May 8, 2024, Primoris Services reported EPS of $0.47 versus consensus estimate of $0.08.
Valuation Metrics
While Primoris Services has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Primoris Services has a Value Score of B. The stock's Growth and Momentum Scores are C and D, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 20.5X current fiscal year EPS estimates, which is a premium to the peer industry average of 19.6X. On a trailing cash flow basis, the stock currently trades at 11.2X versus its peer group's average of 11.4X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Primoris Services currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Primoris Services passes the test. Thus, it seems as though Primoris Services shares could have potential in the weeks and months to come.
How Does PRIM Stack Up to the Competition?
Shares of PRIM have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Great Lakes Dredge & Dock Corporation (GLDD - Free Report) . GLDD has a Zacks Rank of # 1 (Strong Buy) and a Value Score of B, a Growth Score of B, and a Momentum Score of B.
Earnings were strong last quarter. Great Lakes Dredge & Dock Corporation beat our consensus estimate by 416.67%, and for the current fiscal year, GLDD is expected to post earnings of $0.73 per share on revenue of $739.63 million.
Shares of Great Lakes Dredge & Dock Corporation have gained 39.9% over the past month, and currently trade at a forward P/E of 12.73X and a P/CF of 11.61X.
The Building Products - Heavy Construction industry is in the top 1% of all the industries we have in our universe, so it looks like there are some nice tailwinds for PRIM and GLDD, even beyond their own solid fundamental situation.