Everus Construction Group, Inc. (NYSE: ECG)

Sector: Industrials Industry: Engineering & Construction CIK: 0002015845
Market Cap 4.35 Bn
P/B 7.59
P/E 24.04
P/S 1.24
ROIC (Qtr) 19.52
Div Yield % 0.00
Rev 1y % (Qtr) 29.68
Total Debt (Qtr) 369.58 Mn
Debt/Equity (Qtr) 0.64

About

Price action

Investment thesis

Bull case

  • Strong operating cash flow of 189.34M provides robust 0.51x coverage of total debt 369.58M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 149.17M provide 3.25x coverage of short-term debt 45.93M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 189.34M provides strong 35.64x coverage of stock compensation 5.31M, indicating sustainable incentive practices.
  • Strong tangible asset base of 1.48B provides 4.01x coverage of total debt 369.58M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 145.83M exceeds capital expenditure of 43.50M by 3.35x, indicating strong organic growth funding capability.

Bear case

  • Operating cash flow of 189.34M barely covers its investment activities of (45.22M), with a coverage ratio of -4.19, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 189.34M provides insufficient coverage of deferred revenue obligations of 269.83M, which is 0.70x, raising concerns about future service delivery capabilities.
  • High receivables of 743.74M relative to inventory of 47.96M (15.51 ratio) suggests aggressive credit terms or collection difficulties, potentially masking revenue quality issues.
  • R&D investment of 0 represents just 0x of SG&A expenses of 180.96M, indicating potential underinvestment in innovation relative to administrative overhead.
  • Tax assets of 0 provide limited offset against tax liabilities of 24.20M, which is 0x, indicating potential future cash flow pressure from tax obligations.

Peer comparison

Companies in the Engineering & Construction
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 PWR Quanta Services, Inc. 62.71 Bn 61.60 2.31 6.02 Bn
2 FER Ferrovial SE 48.08 Bn 14.25 5.05 -
3 FIX Comfort Systems Usa Inc 35.76 Bn 42.69 4.30 0.39 Bn
4 EME EMCOR Group, Inc. 29.29 Bn 25.91 1.80 0.42 Bn
5 APG APi Group Corp 17.37 Bn 111.36 2.27 3.05 Bn
6 MTZ Mastec Inc 17.01 Bn 51.39 1.24 2.77 Bn
7 J Jacobs Solutions Inc. 16.94 Bn 58.56 1.41 2.71 Bn
8 BLD TopBuild Corp 13.35 Bn 23.52 2.55 3.09 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 2.85 1.61
EV to Cash from Ops. EV/CFO 24.44 6.94
EV to Debt EV to Debt 12.52 11.81
EV to EBIT EV/EBIT 17.36 17.80
EV to EBITDA EV/EBITDA 17.14 13.77
EV to Free Cash Flow [EV/FCF] EV/FCF 31.73 55.77
EV to Market Cap EV to Market Cap 1.06 1.20
EV to Revenue EV/Rev 1.32 1.65
Price to Book Value [P/B] P/B 7.59 5.81
Price to Earnings [P/E] P/E 24.04 35.89
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 2.51
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 25.81
Dividend per Basic Share Div per Share (Qtr) 0.00 0.24
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 4.05
Interest Coverage Int. cover (Qtr) 13.23 80.15
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -53.14 -166.01
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 26,874.14 637.72
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 5.87
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 26.63 92.47
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 23.13 8.04
EBIT Growth (1y) % EBIT 1y % (Qtr) 28.30 85.34
EBT Growth (1y) % EBT 1y % (Qtr) 26.06 42.07
EPS Growth (1y) % EPS 1y % (Qtr) 25.00 43.76
FCF Growth (1y) % FCF 1y % (Qtr) -11.21 -20.95
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 26.99 32.46
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 2.15 1.14
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.05
Cash Ratio Cash Ratio (Qtr) 0.22 0.38
Current Ratio Curr Ratio (Qtr) 1.76 1.55
Debt to Equity Ratio Debt/Equity (Qtr) 0.64 0.89
Interest Cover Ratio Int Coverage (Qtr) 13.23 80.15
Times Interest Earned Times Interest Earned (Qtr) 13.23 80.15
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 8.40 0.40
EBIT Margin % EBIT Margin % (Qtr) 7.63 -2.31
EBT Margin % EBT Margin % (Qtr) 7.05 -4.59
Gross Margin % Gross Margin % (Qtr) 12.10 20.38
Net Profit Margin % Net Margin % (Qtr) 5.20 -5.96