Comfort Systems USA, Inc.

Record growth & profitability (YoY) + strong visibility - Q3 2026 revenue: $3.8B, +54% YoY (+$1.3B). - Net income: $489M, $13.91 EPS, +66% YoY (EPS up $5.66 vs. Q3 2025). - Gross margin: 24.8% (roughly steady YoY), Q3 electrical margin pressured. - Operating income: $625M, +65% YoY (margin 16.6% vs 15.5%). - EBITDA: $668M, +61% YoY; TTM EBITDA ≈ $2.3B. - Free cash flow: $86M in Q3; ~$2B YTD (supported by collections/terms and tax timing).

Backlog surge = major opportunity + long demand runway - Backlog end of Q3 2026: $17.8B (new record). - Backlog growth: +90% vs last year (+$8.4B); +27% sequential (+$3.8B). - Management stated this is driven by exceptionally strong bookings, especially technology/data center/industrial work, with customers booking earlier due to capacity scarcity and labor constraints. - Backlog duration expectation: pushed out to roughly 18–24 months (vs ~9 months historically). - Outlook expectation: continue growth and strong results through 2026 into 2027, with strong demand.

Segment performance: Electrical booming, Mechanical also up—margins mixed - Electrical revenue: +85% (also described as “spectacular organic revenue growth at very high margins”). - Electrical margin issue (the main negative): electrical gross margin 24.3% vs 26.2% in Q3 2025; last year benefited from discrete gains (~+1.8% margin) tied to items like customer bankruptcy emergence—without those, electrical margins were closer to flat. - Mechanical revenue: +43% with higher profitability. - Surprising quarter factor: margin softness is not framed as structural deterioration—management attributes it to temporary mix/cost timing (more equipment/materials early in jobs, and acquisition-related WIP/purchase adjustment effects).