E&C Opportunity At Discount Despite Risks; Revise Est, PT, Reit Buy

Research evidence excerpt

E&C Opportunity At Discount Despite Risks; Revise Est, PT, Reit Buy

mid-September and the *EPS Non-GAAP

last project tracking for the end of the year.

Our other end-market assumptions remain unchanged including Gas Generation, Power Delivery, Exhibit 1 - FY28E End-Market Gross Margin

ElectricalPipeline and Electrical C&I (PayneCrest) as tailwinds are only strengthening. This highlighted by C&I, 9%

$2Bn of Energy Segment bookings concentrated in natural gas generation, industrial, and electric

construction services to support power load growth and data centers. All of which are key growth Power19%Delivery,

drivers going forward. We would reevaluate our Renewables assumptions once bookings are Solar, 19% Gas Operations,11%

realized but not expected until latter half of FY26. Gas Gen, 12%

Communications,

8%

Lower PT to $125 (from $152) on revised renewables-driven estimate revisions, execution

Industrial , 9% Heavy Civil, 6% Pipeline, 8%discount, and m2m peer valuation multiples. We value PRIM on a blended multiple relative to a .

basket of diversified E&C peers. We also apply a 30% risk-adjusted discount to peers to account Source: Jefferies LLC

for execution risk. Our price target now implies 12.4x (vs 14.3x) 27E EV/EBITDA, 21.8x (vs 31.2x)

P/E, and 3.4% (vs 3.4%) FCF yield compared with peer median of 18.8x (vs 20.2x), 32.6x (vs 37.1x),

and 3% (vs 2.7%), respectively.

Julien Dumoulin-Smith * | Equity Analyst

Still view PRIM as an attractively-valued diversified E&C in end-markets with strong demand tailwinds +1 (281) 774-2066 | jds@jefferies.com

with length and visibility for at least next five years and a notable relative valuation outlier at ~50%

Paul Zimbardo * | Equity Analyst

discount to the broader E&C peer group.