Buying the Pullback with No Signs of Slowing; E&C 2Q26 Preview

研报英文原文证据摘录

Buying the Pullback with No Signs of Slowing; E&C 2Q26 Preview

ersification of the cycle. Utility capex Pullback creates compelling entry point,

visibility extends well into next decade; midstream recovering from underinvestment with LNG / but selectivity matters. Premium multiples

gas demand support; communications inflecting into FY27 on FTTH, middle-mile fiber and BEAD; still debatable, but growth, labor scarcity,

renewables / storage still supported by speed-to-market economics. data centers, M&A and large-project awards

provide multiple paths for guidance/consData centers remain the biggest accelerator; labor scarcity the key differentiator. Hyperscaler

estimates higher. No signs of slowing.speed-to-market pulling demand across power generation, T&D, substations, building solutions,

electrical, cooling, MEP, renewables and gas infrastructure. E&Cs increasingly building turnkey

solutions outside and inside the fence. Skilled craft labor remains the bottleneck — electrical,

linesmen, PMs, gas gen and mission-critical C&I most acute — but scarcity is also shifting the model

in favor of better-positioned E&Cs through improved contract terms, better bid margins, stronger

customer loyalty and productivity.

M&A heating up; another estimate-revision lever. Expect continued consolidation across electrical

contracting, MEP and data-center-adjacent services as E&Cs add labor, geographic white space

and inside-the-fence capabilities. Recent transactions suggest data center electrical contractors

are winning the multiple race, with highest valuations for assets bringing scarce labor, hyperscaler Julien Dumoulin-Smith * | Equity Analyst

relationships, visible backlog and mission-critical execution. SMID E&Cs with balance sheet +1 (281) 774-2066 | jds@jefferies.com