Working the Lats: EPC Contract Structures Matter

Research evidence excerpt

Working the Lats: EPC Contract Structures Matter

Energy | Power & Utilities

June 23, 2026

Nicholas Amicucci, CFA Working the Lats: EPC Contract Structures

212-812-2931

nicholas.amicucci@evercoreisi.com Matter

Sharon Wang Shares of publicly traded EPC companies are selling off today as the

212-653-8999 market digests Primoris’ (not covered) business update and 8-K, in

Sharon.Wang@evercoreisi.com which the company announced the departure of its COO and further

lowered its FY26 guidance (the company had also lowered its FY26

guidance with its 1Q26 results). The lowering of Primoris’ FY26 revenue

and margin guidance represents the second time the company has cut

guidance over the last three months, citing lower expected revenue and

profitability within its Renewables business due to 6 projects

(unchanged from prior guidance reduction). While the cost overruns

experienced at the 6 projects have an impact on PRIM, based on the

information disclosed to date, we do not view PRIM’s project-

specific issues as sufficient evidence of a broad solar+storage

EPC industry problem. That said, PRIM’s update underscores

execution risk across fixed-price EPC work, and we would use any

pullback in PWR/MWH selectively, focusing on company-specific

backlog quality, contracting structure, and margin-risk controls.

As we outline on page 2, MWH and PWR both provide their

respective customers with a full lifecycle offering which we

believe mitigates some of the risk associated with a more project-

based EPC business and provides more predictable revenue

visibility. Importantly, we believe instances such as this one further

highlight the value provided by PWR’s unit-based project approach and

MWH’s Limited Notice to Proceed (LNTP) strategy, something we