Can EMCOR Outgrow Nonresidential Construction Again in 2026?
EMCOR Group, Inc.EME appears well positioned to outperform the broader U.S. nonresidential construction market again in 2026, supported by strong demand across multiple end markets, a record project backlog and continued share gains in mission-critical infrastructure. While industry growth is expected to remain moderate, the company continues to benefit from exposure to structural growth markets such as data centers, healthcare, institutional facilities, water infrastructure and advanced manufacturing.
Management remains confident that the company will continue growing meaningfully faster than the broader nonresidential construction market. During the first-quarter earnings call, EMCOR stated that it expects to "continue to grow in excess of nonresidential construction" while expanding its presence across existing and adjacent geographies, particularly within the data center market.
The company has already demonstrated that momentum. First-quarter 2026 revenues increased 19.7% year over year to a record $4.63 billion, or 16.8% on an organic basis. Strong execution prompted management to raise its full-year 2026 revenue guidance to $18.5-$19.25 billion from the prior range of $17.75-$18.5 billion, while also increasing its diluted EPS outlook. Importantly, management indicated that growth is extending beyond data centers.
One reason EMCOR appears capable of sustaining above-market growth is the breadth of its end-market exposure. Rather than relying on a single growth engine, the company continues to benefit from multiple construction verticals. Network and communications, which includes data centers, remains the largest contributor to growth as artificial intelligence (AI), cloud computing and digital infrastructure investments continue to accelerate. At the same time, EMCOR is experiencing strong activity in institutional construction, manufacturing and industrial facilities, healthcare projects and water and wastewater infrastructure. Mechanical construction also benefited from the recovery in warehousing, distribution and logistics projects during the quarter.
Although macroeconomic uncertainty, labor availability and project timing remain industry risks, EMCOR's diversified project portfolio, expanding backlog and exposure to long-term infrastructure investment appear to position the company to continue outperforming broader nonresidential construction trends. If demand across data centers, institutional facilities, healthcare and water infrastructure remains healthy, EMCOR could again deliver growth that exceeds the overall nonresidential construction market in 2026.
Peers Also Positioned to Outgrow the Market
EMCOR is not the only contractor benefiting from resilient demand across high-growth nonresidential construction markets. Industry peers Sterling Infrastructure, Inc.STRL and Comfort Systems USA, Inc.FIX are also capitalizing on sustained investment in mission-critical facilities, advanced manufacturing and data center infrastructure, positioning themselves to outpace broader construction industry growth.
Sterling continues to benefit from robust demand in its E-Infrastructure business, where data centers remain the primary growth driver. The company reported that mission-critical projects, including data centers, semiconductor facilities and advanced manufacturing, accounted for more than 90% of its E-Infrastructure signed backlog. Sterling also highlighted expanding opportunities across new geographies, growing cross-selling between its site development and electrical businesses, and increasing project size and complexity — all of which are expected to support above-market growth over the long term.
Comfort Systems is similarly benefiting from structural demand across technology and institutional markets. Management noted that advanced technology, led primarily by data center projects, accounted for 56% of first-quarter revenues and remained the company's largest driver of pipeline and backlog growth. At the same time, healthcare, education and government projects continued to provide a solid base of institutional demand, while ongoing investments in modular manufacturing capacity are expected to support future expansion and execution.
EME Stock’s Price Performance & Valuation Trend
Shares of this Connecticut-based infrastructure service provider have gained 25.7% year to date, slightly underperforming the Zacks Building Products - Heavy Construction industry, but outperforming the Construction sector and the S&P 500 Index.
Image Source: Zacks Investment Research
EME stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 24.67, as evidenced by the chart below.
Image Source: Zacks Investment Research
Earnings Estimate Revision of EME Stock
EME’s earnings estimates for 2026 and 2027 have moved upward in the past 60 days. The estimates for 2026 and 2027 imply year-over-year growth of 13.5% and 11.8%, respectively.
Image Source: Zacks Investment Research
EMCOR stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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