Although the S&P 500 is down 5.8% over the past six months, EMCOR’s stock price has fallen further to $440.40, losing shareholders 15.4% of their capital. This might have investors contemplating their next move.
Following the pullback, is now a good time to buy EME? Find out in our full research report, it’s free.
Why Is EMCOR a Good Business?
Through its network of over 70 subsidiaries, EMCOR (NYSE: EME) provides electrical, mechanical, and building construction and services
1. Long-Term Revenue Growth Shows Strong Momentum
Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Luckily, EMCOR’s sales grew at a solid 10% compounded annual growth rate over the last five years. Its growth surpassed the average industrials company and shows its offerings resonate with customers. 
2. Outstanding Long-Term EPS Growth
Analyzing the long-term change in earnings per share (EPS) shows whether a company's incremental sales were profitable – for example, revenue could be inflated through excessive spending on advertising and promotions.
EMCOR’s EPS grew at an astounding 31.2% compounded annual growth rate over the last five years, higher than its 10% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
3. New Investments Bear Fruit as ROIC Jumps
A company’s ROIC, or return on invested capital, shows how much operating profit it makes compared to the money it has raised (debt and equity).
We like to invest in businesses with high returns, but the trend in a company’s ROIC is what often surprises the market and moves the stock price. EMCOR’s ROIC has increased significantly over the last few years. This is a great sign when paired with its already strong returns. It could suggest its competitive advantage or profitable growth opportunities are expanding.
Final Judgment
These are just a few reasons why EMCOR ranks highly on our list. After the recent drawdown, the stock trades at 18.8× forward P/E (or $440.40 per share). Is now a good time to initiate a position? See for yourself in our full research report, it’s free.
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