Comfort Systems (FIX) Bolsters Market Presence With Summit Buyout
Comfort Systems USA, Inc. FIX successfully completed the acquisition of Summit Industrial Construction, LLC. Summit, a specialized industrial mechanical contractor, enhances Comfort Systems' capabilities in engineering, design-assist, and turnkey construction services for modular systems.
Shares of Comfort Systems have gained 3.5% during the trading session on Feb 1 and 0.9% in the after-hour trading session on the same day.
Serving advanced technology, power, and industrial sectors, Summit brings a stellar reputation as a leader in modular technology, particularly in semiconductor projects. Summit's robust capabilities include process piping, equipment setting, large pipe rack trestles, and related steel erection and specialty concrete work.
With ongoing major chip fabrication projects, Summit is expected to contribute annualized revenues of $375 million to $400 million and earnings before interest, taxes, depreciation, and amortization of $35 million to $40 million. Despite amortization expenses, Summit's addition is anticipated to be neutral to slightly accretive to Comfort Systems' earnings per share (EPS) in 2024 and 2025.
Comfort Systems is confident that Summit, known for innovation and excellence in modular and complex mechanical services, will thrive as part of its network of world-class contracting companies. This strategic acquisition positions Comfort Systems for continued growth and leadership in the evolving industrial landscape.
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Acquisitions: A Growth Driver
FIX remains dedicated to pursuing growth through acquisitions while concurrently returning value to shareholders through cash dividends and stock repurchases.
On Feb 1, 2023, Comfort Systems acquired Eldeco, Inc., based in South Carolina. Specializing in electrical design and construction services in the Southeastern region of the United States, Eldeco is now a fully owned subsidiary of Comfort Systems. This integration is reflected in FIX's electrical segment, marking a strategic expansion in the company's service portfolio and regional presence.
Shares of Comfort Systems have surged 83.9% over the past year, outperforming the Zacks Building Products - Air Conditioner and Heating industry’s 39.5% rise. The company has been experiencing increased revenue across its operations. Notably, the modular business demonstrated exceptional performance during third-quarter 2023, managing extraordinary growth with superb execution.
Zacks Rank & Key Picks
Comfort Systems currently carries a Zacks Rank #3 (Hold).
Here are some better-ranked stocks from the Zacks Construction sector:
Martin Marietta Materials, Inc. MLM currently carries a Zacks Rank #2 (Buy). The stock has gained 13.7% in the past six months. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MLM delivered a trailing four-quarter earnings surprise of 37.3%, on average. The Zacks Consensus Estimate for MLM’s 2024 sales and EPS indicates growth of 9.5% and 13.1%, respectively, from a year ago.
North American Construction Group Ltd. NOA currently carries a Zacks Rank #2. The stock has declined 10.4% in the past six months.
NOA surpassed earnings expectations in three of the trailing four quarters and missed on one occasion, the average surprise being 22.4%. The Zacks Consensus Estimate for NOA’s 2024 sales and EPS indicates growth of 44.1% and 51.7%, respectively, from a year ago.
Howmet Aerospace Inc. HWM currently carries a Zacks Rank #2. The stock has gained 19.1% in the past six months.
HWM surpassed earnings expectations in three of the trailing four quarters and met on one occasion, the average surprise being 5%. The Zacks Consensus Estimate for HWM’s 2024 sales and EPS indicates growth of 7.5% and 21.7%, respectively, from a year ago.
Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.
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