# Comfort Systems USA (FIX) — InvestMoat Analysis _Last analyzed: October 11, 2026_ _Asset class: equity · Canonical page: https://investmoat.com/stocks/fix_ ## Scores | Dimension | Score (0–100) | | --- | --- | | Moat durability | 65 | | Growth trajectory | 76 | | Valuation | 72 | | **Composite** | **71** | Scores are computed deterministically from this asset’s data by the InvestMoat formula (see https://investmoat.com/llms.txt for methodology). Scores are not directly comparable across asset classes. ## Key stats - **Ticker:** FIX - **Market Cap:** ~$60B ## Moat One of the two largest US mechanical contractors, now with a fast-growing electrical arm and a modular prefabrication footprint heading past 4 million square feet — a moat built on scarce craft labour, repeat relationships with hyperscale and advanced-manufacturing builders, and execution that earns materially higher margins than its closest rival. ### The Craft-Labour and Modular-Execution Moat Comfort Systems' edge is **execution on the hardest building systems in the country** — mechanical and electrical scopes for data centres, chip fabs and pharma plants, increasingly built off-site in its own modular plants. It is a real, margin-proven advantage, but one that rests on people and process rather than on a structural lock: - **Margin Leadership Over the Closest Rival:** In Q2 2026 Comfort Systems earned ~17.1% operating margin on $3.27B of revenue, against EMCOR's 10.6% on $5.15B. Gross margin rose to 25.9% from 23.5%, with Mechanical at 25.6% and Electrical at 26.4%. The gap reflects mix toward technology work, decentralised operating companies that price their own jobs, and fewer construction-manager or prime-contractor roles — EMCOR's mechanical margin fell 110 bp on exactly that shift. - **Modular Prefabrication:** The modular business booked a record ~$510M of new orders in Q2, and management is expanding capacity to more than 4 million square feet by the end of 2026 and about 5 million by late summer 2027. Building skids, racks and electrical rooms in a factory moves craft hours off congested job sites, which is the scarce input in a data-centre build. - **Embedded With Technology Builders:** Technology customers, including data centres, were about 58% of revenue in the first half of 2026, up from about 40%. Repeat campus work with the same builders turns into backlog visibility — $14.06B, roughly 1.1× this year's expected revenue — but also concentrates the book in a handful of hyperscaler programmes. **Moat verdict:** Comfort Systems is a net AI beneficiary: data-centre and chip-fab construction drove technology work to about 58% of revenue and backlog to a record $14.06B, and nothing in its physical, craft-labour business is exposed to AI substitution. Its advantages — scarce trades, modular prefabrication, repeat relationships and a margin lead over EMCOR — are real but all intact rather than strong, so the franchise is durable through this cycle while the main risk is that the cycle itself digests. ### Top competitors - **EMCOR Group (EME):** Largest US mechanical and electrical contractor, the closest like-for-like rival on data-center and industrial building systems. - **[Quanta Services (PWR)](https://investmoat.com/stocks/pwr):** Specialty electrical contractor competing for data-center power and electrical scopes. - **IES Holdings (IESC):** Electrical contractor and prefab builder focused on data-center and commercial work. - **MasTec (MTZ):** Infrastructure contractor expanding into data-center and power-delivery construction. ## Growth Q2 2026 revenue was $3.27B, +50% YoY (same-store +44%), with Mechanical +40% to $2.30B and Electrical +81% to $969M ($132.6M of that increase acquired, largely Hunt Electric, closed May 1). Q2 diluted EPS was $12.53 vs $6.53; operating income $558M vs $299.9M. Backlog reached a record $14.06B (+73% YoY; $5.6B of the increase same-store), and management raised its 2026 same-store revenue growth outlook to the mid-to-high 30% range from mid-to-high 20%, while flagging tougher fourth-quarter comparisons. FY2025 revenue was $9.10B (+29%) with EPS of $28.88. - **Revenue CAGR estimate:** 14-20% - **Primary type:** both - **Margin trend:** expanding - **Key risk (moderate):** Technology work was about 58% of first-half 2026 revenue and much of the backlog sits with a small number of hyperscaler campuses; if two or more of those programmes are paused or re-phased in 2027–28, book-to-bill drops below 1.0, same-store growth falls to single digits, and the ~25–26% gross margin earned in a capacity-tight market reverts toward the low 20s. - **Drivers:** - Mechanical Services — Q2 2026 revenue $2.30B, +40% YoY (70% of revenue); modular orders a record ~$510M in the quarter (decelerating) - Electrical Services — Q2 2026 revenue $969M, +81% YoY, of which $301.7M of the $434.3M increase was same-store (decelerating) - **Score derivation:** Base 81.3 (14–20% CAGR, midpoint 17%) − 4 trajectory (Mechanical +47% in Q1 → +40% in Q2; Electrical +88% → +81%; both still very fast but both decelerating) + 4 margin expanding (Q2 operating margin ~17.1% vs ~13.8%; gross margin 25.9% vs 23.5%) − 5 moderate risk (data-centre capex digestion, the same grade as PWR, VRT and ETN) = 76 ## Valuation At ~$1,715 (October 9, 2026 close) — about 17% below the $2,073.99 52-week high and more than double the ~$770 low — FIX trades at ~42× trailing EPS (~$40.6), ~35× a 2026 EPS of roughly $49–50 (first-half actual $23.03 plus the Street's second half) and ~28× the ~$61 2027 consensus. On a $1,250 / $1,900 / $2,600 ladder the price sits about 72% of the way from bear to base, giving a valuation score of 72: below a base set at a PWR-like ~31× 2027 EPS and ~9% under the Street mean, with Q3 results due October 22. | Multiple | Value | Note | | --- | --- | --- | | Trailing P/E (GAAP) | ~42× | TTM EPS ~$40.6: FY2025 $28.88 + H1 2026 $23.03 − H1 2025 $11.28 | | Forward P/E (FY26) | ~35× | ~$49–50: H1 actual $23.03 plus Q3 consensus ~$12.94 and a similar Q4 | | Forward P/E (FY27 consensus) | ~28× | FY27 EPS consensus ~$60.78 (single aggregator; range starts at ~$50.61) | | PEG Ratio | ~1.2× | ~28× ÷ ~23% FY26→FY27 EPS growth | | Price / Sales (FY26) | ~4.6× | ~$60B market cap ÷ ~$13.1B consensus revenue | At ~28× 2027 consensus FIX trades a little below Quanta (~32× forward) despite a higher operating margin, because its growth is more concentrated in data-centre construction and is decelerating from a 50%+ peak. The ~42× trailing to ~28× two-year-forward gap shows an earnings ramp still under way; the PEG of ~1.2× is fair for growth that holds above 20% into 2027, but leaves the stock exposed if hyperscaler capex digests. _(as of October 9, 2026 (price ~$1,715))_ ## Price scenarios ### Bear — $1,250 Hyperscaler capex digests in 2027, technology orders slow, book-to-bill slips below 1.0 and the multiple compresses toward an E&C norm while 2027 EPS still grows modestly. - ~22× a reduced 2027 EPS of ~$57 (≈$1,250), a de-rating from ~28× forward, in line with the ~20–24× bear multiples used for Vertiv, Eaton and Quanta - Two or more hyperscaler campuses are paused or re-phased and backlog falls from the $14.06B record - Gross margin reverts from ~25.9% toward the low 20s as contractors chase fewer large jobs and the new modular capacity runs below utilisation ### Base — $1,900 2026 EPS lands near $49–50, 2027 grows roughly 20–25% on backlog conversion toward ~$61, and the stock holds a multiple near Quanta's on similar growth. - ~31× 2027 EPS of ~$61 (≈$1,900), close to Quanta's ~33× base on the same year, ~9% below the ~$2,083 Street mean - 2026 same-store growth lands in the guided mid-to-high 30s and 2027 revenue reaches ~$15.6B - Modular capacity reaches ~5M square feet by late summer 2027 and holds gross margin in the mid-20s ### Bull — $2,600 AI data-centre and advanced-manufacturing construction extends through 2029, 2028 EPS compounds above $70 and the multiple holds the mid-30s. - ~36× 2028 EPS of ~$72 (≈$2,600), about 25% above the $2,073.99 52-week high - Backlog keeps growing past $17B as chip-fab, pharma and power-plant mechanical work adds to data centres - Electrical keeps compounding through acquisitions like Hunt Electric, and operating margin holds near 17% --- InvestMoat is a research and education framework. Nothing here is financial advice. Past performance does not guarantee future results.