EMCOR Group (EME) could have "similarly strong" Q2 results to Comfort Systems USA (FIX), as the two companies are driven by the same trends, UBS Securities said in a Friday note.
Comfort Systems reported an acceleration in organic growth in Q2, contrasting with investors' expectations of a modest deceleration, and its backlog grew 18% quarter over quarter, bucking a normal seasonal decline, UBS analysts said.
Data from new projects starting and Comfort Systems' backlog growth suggest bookings could be "strong" for EMCOR, according to the note. Investors will focus on EMCOR's data center backlog as an indicator that the company can continue to drive growth in 2026, the note said.
In Q1, both companies posted "strong" results, with EMCOR reporting several days later. The analysts said that, despite the positive results, EMCOR's stock closed down 3% as its surpassing of expectations was not as large as Comfort Systems. With Comfort Systems' performance in Q2, the market could react in a similar way for EMCOR, the analysts said, adding that they would be "buyers of any weakness," assuming the underlying trends for both companies remain consistent.
UBS reiterated the company's stock rating at buy and raised the price target to $715 from $570.
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