Emcor Financial Model
Construction Company Financials Example (Free Excel Download)
EMCOR Group, Inc. is one of the largest specialty contractors in the United States, providing electrical and mechanical construction, industrial and energy infrastructure, and building services.
professionals from Deloitte
Used by professionals from
About this model
This model provides a comprehensive equity valuation and scenario planning tool for EMCOR Group, Inc., enabling analysts to forecast earnings and cash flow based on remaining performance obligations (backlog) conversion, segment-level margin sustainability, and capital allocation following the recent Miller Electric acquisition and United Kingdom operations divestiture.
EMCOR Group, Inc. is one of the largest specialty contractors in the United States, providing electrical and mechanical construction, industrial and energy infrastructure, and building services. The company designs, installs, operates, and maintains complex systems (HVAC, electrical, plumbing) for commercial, industrial, healthcare, and institutional clients.
The business operates through four primary ongoing segments: United States Electrical Construction and Facilities Services (approximately 30% of 2025 revenue), United States Mechanical Construction and Facilities Services (approximately 42%), United States Building Services (approximately 18%), and United States Industrial Services (approximately 7%). The company previously operated a United Kingdom Building Services segment (approximately 3% of revenue), which was divested on 1 December 2025. EMCOR operates an asset-light, human-capital-intensive business model that relies on highly skilled union and non-union labour. The company holds a dominant competitive position in the fragmented specialty contracting market and is currently benefiting from major secular tailwinds, including data centre construction, manufacturing reshoring, and the energy transition.
The downloadable Emcor financial model includes SEC-sourced historical financials, forecast assumptions, core operating schedules, and valuation outputs in an Excel workbook built for review and scenario analysis.
A turnkey financial model
Live formulas, no hardcoded values
Outputs are driven by live formulas, so the workbook updates from its assumptions instead of relying on hardcoded results.
All assumptions in one tab
Inputs are clearly marked in the Assumptions tab and separated from calculations, making it clear what to change and what to leave intact.
Statements always balancing
For integrated-statement models, the balance sheet, cash flow, and supporting schedules tie through properly.
Distinct schedules for clarity
Debt, working capital, taxes, and cash flow can get messy quickly. We group calculations in clear schedules, not across disconnected tabs.
No hidden macros or external links
There are no unexplained external workbook links or macros to undermine auditability or portability.
Changes flow through the model
Update a key driver and see the impact carry through the forecast, financing, and return outputs. We never use hardcoded numbers in formulas.
Historicals & AssumptionsEmcor financial modelCompany, Historicals & Assumptions used
Source: SEC EDGAR · values in USD
| Line item | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Revenue | $9.90B | $11.08B | $12.58B | $14.57B | $16.99B |
| Gross profit | $1.50B | $1.60B | $2.09B | $2.77B | $3.28B |
| Operating income | $530.8M | $564.9M | $875.8M | $1.34B | $1.71B |
| Net income | $383.5M | $406.1M | $633.0M | $1.01B | $1.27B |
Forecast assumptions
Defaults used in the downloadable model. Forecast horizon: FY2026–FY2030.
See 8 moreSee less
How to build a detailed financial model for Emcor
A complete walkthrough of every driver, margin, working-capital input, and capital-allocation assumption used in the downloadable model.
Revenue Deep Dive
United States Electrical Construction and Facilities Services
- Revenue driver formula: Beginning Remaining Performance Obligations (RPO) + New Awards - Ending RPO = Revenue Recognised.
- Historical growth rate: 15% to 25% CAGR (heavily boosted by the 2025 Miller Electric acquisition and data centre demand).
- Key growth levers and headwinds: Driven by high-tech manufacturing, semiconductor fabrication plants, and hyperscale data centre builds. Headwinds include skilled labour shortages and supply chain delays for electrical switchgear.
- Pricing dynamics: Primarily fixed-price contracts with some time-and-materials work; pricing power is currently strong due to labour scarcity.
- Revenue recognition notes: Recognised over time using the percentage-of-completion method based on costs incurred relative to total estimated costs.
- Seasonality: Relatively balanced, though winter weather can slightly delay outdoor site preparation in Q1.
United States Mechanical Construction and Facilities Services
- Revenue driver formula: Beginning RPO + New Awards - Ending RPO = Revenue Recognised.
- Historical growth rate: 10% to 15% CAGR.
- Key growth levers and headwinds: Driven by complex HVAC installations, cleanrooms, and healthcare facility upgrades.
- Pricing dynamics: Highly disciplined bidding process; margins expand when the company can be selective with project acceptance.
- Revenue recognition notes: Percentage-of-completion method.
- Seasonality: Q2 and Q3 are typically the strongest quarters due to optimal construction weather.
United States Building Services
- Revenue driver formula: Number of Maintenance Contracts x Average Contract Value + Project Upgrades.
- Historical growth rate: 4% to 7% CAGR.
- Key growth levers and headwinds: Driven by energy efficiency retrofits and routine maintenance. Commercial office vacancy rates present a slight headwind, offset by institutional and government work.
- Pricing dynamics: Contractual recurring revenue with inflation-linked escalators.
- Revenue recognition notes: Maintenance services are recognised evenly over the contract term; project work is recognised over time.
- Seasonality: Stronger in Q2 and Q3 as schools and universities perform maintenance during summer holidays.
United States Industrial Services
- Revenue driver formula: Number of Turnaround Events x Average Revenue per Turnaround + Shop Fabrication Volume.
- Historical growth rate: 2% to 5% CAGR (highly cyclical).
- Key growth levers and headwinds: Dependent on refinery utilisation rates and petrochemical facility maintenance schedules.
- Pricing dynamics: Often time-and-materials or unit-rate based.
- Revenue recognition notes: Recognised as services are performed.
- Seasonality: Highly seasonal. Q2 (spring) and Q4 (autumn) are the strongest quarters as refineries schedule turnarounds during shoulder months when energy demand is lower.
United Kingdom Building Services (Divested)
- Segment note: Sold on 1 December 2025. The model must zero out this revenue for 2026 and beyond, accounting for the 3% structural headwind to consolidated year-over-year growth.
Cost Structure
Variable Costs / COGS
- Line-by-line breakdown: Direct labour (wages and union benefits), materials (copper, steel, HVAC equipment), subcontractor costs, and direct equipment rentals.
- Gross margin range: 15.0% to 19.5% (reached a record 19.3% in 2025).
- Key input costs and commodity exposures: Copper, steel, and aluminium. The company typically mitigates this by locking in material prices upon contract award.
- How COGS scales with revenue: Highly linear. Specialty contracting has limited operating leverage at the gross margin line because every new project requires incremental labour and materials.
Operating Expenses
- R&D: Not applicable or material for this business.
- SG&A: Typically 9.5% to 10.5% of revenue. Includes corporate overhead, estimating and bidding costs, IT, and regional management. Scales with headcount but provides some operating leverage during high-growth periods.
- Depreciation & Amortisation: Approximately 1.0% to 1.5% of revenue. Amortisation of acquired intangible assets (customer relationships, backlog) makes up a significant portion due to the serial acquisition strategy.
- Stock-Based Compensation: Relatively low, typically under 0.5% of revenue.
- Restructuring / one-time charges: Infrequent, though transaction expenses related to M&A (e.g., $20 million in 2025 for Miller Electric and the UK sale) do occur.
Margin Profile
- Gross margin: 15.0% to 19.5%.
- EBITDA margin: 8.0% to 11.0%.
- Operating margin: 6.5% to 10.5% (hit a record 9.4% adjusted / 10.1% GAAP in 2025).
- Margin trend: Expanding significantly over the last three years due to exceptional project execution, a shift toward higher-margin data centre work, and disciplined bidding.
- Segment-level margins (2025): Mechanical Construction (12.8%), Electrical Construction (12.1%), Building Services (6.0%).
Balance Sheet Structure
- Total assets: Approximately $6.0 billion to $7.0 billion.
- Key asset categories: Cash and cash equivalents, Accounts Receivable, Contract Assets (costs and estimated earnings in excess of billings), Goodwill, and Identifiable Intangible Assets.
- Goodwill & intangibles: Represents a large portion of total assets (often >30%) due to the company's history of acquiring regional specialty contractors.
- Working capital profile:
- Days Sales Outstanding (DSO): 60 to 75 days (including retainage).
- Days Inventory Outstanding (DIO): Negligible (materials are typically shipped directly to job sites).
- Days Payable Outstanding (DPO): 50 to 65 days.
- Net working capital as % of revenue: Typically ranges from -2% to +3%.
- Working capital dynamic: The company strives to overbill on projects (Contract Liabilities / billings in excess of costs). This provides a negative working capital advantage, meaning growth is often self-funding.
- PP&E: Very light. Consists mostly of vehicle fleets, small tools, and regional office leases.
- Right-of-use assets: Material but manageable, primarily related to office and warehouse leases.
Capital Expenditure & Investment
- Capex as % of revenue: 0.5% to 1.0% (highly asset-light).
- Maintenance vs. growth split: Almost entirely maintenance (replacing vehicles, IT systems, and tools).
- Major capex programmes: None. The company does not build large manufacturing facilities.
- M&A pattern: Serial acquirer. EMCOR executes numerous bolt-on acquisitions annually and occasional transformational deals (such as the Miller Electric acquisition in early 2025).
- Typical acquisition multiple paid: Historically 6x to 9x trailing EBITDA, though larger deals may command slight premiums.
Debt & Capital Structure
- Total debt: Generally low; the company often operates with a net cash position.
- Debt/EBITDA ratio: Consistently below 1.0x.
- Key debt instruments: Revolving credit facility and occasional term loans used to bridge large acquisitions.
- Interest rate profile: Mostly floating rate via the credit facility, though interest expense is minimal.
- Covenants: Standard leverage and interest coverage ratios; the company operates with massive headroom.
- Share repurchase programme: Highly active. The company repurchased approximately $600 million in shares during 2025.
- Dividend policy: Consistent dividend payer. Increased to $0.40 per share quarterly in late 2025 ($1.60 annualised), representing a very low payout ratio (under 10%) to preserve capital for M&A and buybacks.
Cash Flow Characteristics
- Operating cash flow conversion: OCF / Net Income typically ranges from 0.9x to 1.2x. In 2025, OCF was $1.3 billion against $1.27 billion in net income.
- Free cash flow margin: 5.0% to 7.0% of revenue.
- Major non-cash items: Depreciation, amortisation of intangibles, and the $144.9 million gain on the sale of the UK operations in 2025 (which must be deducted from net income to reach OCF).
- Working capital cash flow impact: Can be volatile quarter-to-quarter based on project milestones and retainage collection, but generally neutral over a full fiscal year.
- Capex intensity: Extremely low, resulting in FCF closely mirroring OCF.
- Cash tax rate: Closely tracks the GAAP effective tax rate of approximately 26%.
Sheet Structure
- Assumptions: Hardcoded drivers for macroeconomic inputs, segment growth, margins, tax rates, and capital allocation.
- Scenario Tracker: Toggles for Base, Bull, and Bear cases affecting RPO conversion and margin degradation.
- RPO & Awards (Backlog): Roll-forward of Remaining Performance Obligations by segment (Beginning RPO + Awards - Revenue).
- Income Statement: Consolidated view mirroring the 10-K, down to Net Income and EPS.
- Segment Build: Revenue, Gross Profit, and Operating Income broken out for US Electrical, US Mechanical, US Building Services, US Industrial, and UK Building Services (historical only).
- Balance Sheet: Standard assets, liabilities, and equity. Must explicitly break out Contract Assets and Contract Liabilities.
- Cash Flow Statement: Indirect method starting from Net Income, adjusting for D&A, gains on sales, and working capital changes.
- Working Capital Schedule: DSO, DPO, and contract asset/liability turnover calculations.
- Debt & Interest Schedule: Revolver balance, term loans, interest income on cash balances, and interest expense.
- PP&E & Intangibles: Capex, depreciation, goodwill additions from M&A, and amortisation of acquired intangibles.
- Equity & Shares: Share count roll-forward, buyback calculations, and dividend payments.
- Valuation (DCF): Unlevered free cash flow build, WACC calculation, and terminal value.
- Trading Comparables: Multiples for peers like Quanta Services (PWR), Comfort Systems USA (FIX), and MasTec (MTZ).
Key Financial Relationships
- `Segment Revenue = Beginning Segment RPO x Assumed Conversion Percentage + In-Year Book-and-Burn Revenue`
- `Ending Segment RPO = Beginning Segment RPO + Segment New Awards - Segment Revenue`
- `US Electrical Construction Operating Income = US Electrical Revenue x US Electrical Operating Margin (historically ~12%)`
- `US Mechanical Construction Operating Income = US Mechanical Revenue x US Mechanical Operating Margin (historically ~12.5%)`
- `Consolidated Operating Income = Sum of Segment Operating Incomes - Unallocated Corporate SG&A`
- `Contract Assets = (Days Contract Assets Outstanding / 365) x Consolidated Revenue`
- `Contract Liabilities = (Days Contract Liabilities Outstanding / 365) x Consolidated Revenue`
- `Net Working Capital = (Accounts Receivable + Contract Assets + Inventory + Prepaid Expenses) - (Accounts Payable + Contract Liabilities + Accrued Expenses)`
- `Free Cash Flow = Cash from Operations + Capex (where Capex is a negative value)`
- `Interest Income = Average Cash Balance x Yield on Cash`
- `Interest Expense = Average Debt Balance x Weighted Average Interest Rate`
- `Basic Shares Outstanding = Prior Period Shares - (Share Repurchase Amount / Average Share Price)`
Cross-Sheet Dependencies
- The RPO & Awards sheet is the primary engine of the model; it feeds revenue directly into the Segment Build.
- The Segment Build aggregates to total revenue and operating income on the Income Statement.
- Revenue from the Income Statement drives the Working Capital Schedule (AR, AP, Contract Assets, Contract Liabilities).
- Changes in working capital flow into the Cash Flow Statement.
- The Cash Flow Statement determines the ending cash balance and debt drawdowns, which feed the Balance Sheet and the Debt & Interest Schedule.
- The Debt & Interest Schedule calculates interest expense and income, which loop back to the Income Statement. This creates a circular reference that must be managed with a circuit breaker toggle.
Sign Convention
- Income Statement: Revenues are positive. All expenses (COGS, SG&A, Interest, Taxes) are negative. Net Income is positive if profitable.
- Balance Sheet: All assets, liabilities, and equity balances are positive.
- Cash Flow Statement: Net Income is positive. Non-cash add-backs (Depreciation) are positive. Increases in assets (use of cash) are negative. Increases in liabilities (source of cash) are positive. Capex is negative. Dividends and share repurchases are negative. Debt drawdowns are positive; repayments are negative.
Things Most Likely to Go Wrong
- UK Divestiture Stub: The model must explicitly zero out the UK Building Services segment for 2026. Failing to do so will overstate revenue by approximately 3%.
- Gain on Sale Distortion: The $144.9 million gain from the UK sale in Q4 2025 must be excluded from go-forward operating margin calculations and deducted from Net Income in the 2025 Cash Flow Statement.
- Contract Asset/Liability Imbalance: Specialty contractors often have volatile working capital. The builder must ensure Contract Assets and Contract Liabilities scale appropriately with revenue; otherwise, operating cash flow will break.
- Amortisation Misclassification: EMCOR has significant amortisation of identifiable intangible assets due to M&A. This must be kept separate from PP&E depreciation and added back correctly in the cash flow statement.
- Margin Extrapolation: Operating margins reached record highs in 2025 (over 12% in Mechanical/Electrical). Extrapolating these indefinitely without a reversion-to-mean scenario will result in an overly aggressive valuation.
- Share Count Reduction: Because EMCOR uses its robust free cash flow to buy back stock aggressively, failing to model the declining share count will severely understate future Earnings Per Share.
- Interest Income vs Expense: EMCOR often holds over $1 billion in cash. The model must capture interest income on this cash, which is a material contributor to the bottom line in a high-interest-rate environment.
- M&A Transaction Costs: The $20 million in transaction expenses from 2025 should be treated as non-recurring when calculating adjusted go-forward EBITDA.
Validation Checks
- "Consolidated Gross Margin should remain between 15.0% and 19.5%; flag if it exceeds 20.0%."
- "Capex as a percentage of revenue must not exceed 1.5%; this is an asset-light business."
- "Operating Cash Flow must be positive and generally exceed 90% of Net Income."
- "The Balance Sheet must balance perfectly in every period: Total Assets = Total Liabilities + Shareholders' Equity."
- "UK Building Services revenue must equal exactly zero in all periods after 2025."
- "Effective tax rate should remain between 25.5% and 27.5%."
- "Debt-to-EBITDA should remain below 1.5x unless a major transformational acquisition is modelled."
- "Total Segment Operating Income minus Corporate Unallocated Expenses must equal Consolidated Operating Income."
Key Assumptions (Default Values)
| Assumption | Default Value | Unit | Rationale |
|---|---|---|---|
| US Electrical Construction Rev Growth | 12.0 | % | Normalising from 2025 highs but supported by strong data centre backlog |
| US Mechanical Construction Rev Growth | 8.0 | % | Steady growth driven by healthcare and high-tech manufacturing |
| US Building Services Rev Growth | 5.0 | % | Stable, recurring maintenance contract growth |
| US Industrial Services Rev Growth | 3.0 | % | Low-growth, cyclical refinery turnaround market |
| UK Building Services Rev Growth | 0.0 | % | Segment divested in December 2025 |
| US Electrical Operating Margin | 11.5 | % | Slight normalisation from 2025 peak of 12.1% |
| US Mechanical Operating Margin | 12.0 | % | Slight normalisation from 2025 peak of 12.8% |
| US Building Services Operating Margin | 6.0 | % | Consistent with 2025 actuals |
| US Industrial Services Operating Margin | 4.5 | % | Historical average for this cyclical segment |
| Corporate SG&A (Unallocated) | 1.5 | % of Rev | Historical run-rate for corporate overhead |
| Days Sales Outstanding (DSO) | 65 | Days | Based on historical AR and retainage collection cycles |
| Days Payable Outstanding (DPO) | 55 | Days | Based on historical vendor payment cycles |
| Capex as % of Revenue | 0.8 | % | Asset-light business model requiring minimal capital investment |
| Effective Tax Rate | 26.1 | % | Matches 2025 actual reported tax rate |
| Annual Share Repurchases | 600 | $ Millions | Matches 2025 actual buyback activity |
| Quarterly Dividend per Share | 0.40 | $ | Stated dividend policy as of late 2025 |
| Yield on Cash | 4.0 | % | Assumed interest rate on $1.1B cash balance |
| WACC | 8.5 | % | Standard discount rate for a low-beta, low-leverage contractor |
| Terminal Growth Rate | 2.5 | % | Long-term macroeconomic construction growth rate |
Data Sources & Benchmarks
- SEC Filings: EMCOR Group (EME) EDGAR page for 10-K, 10-Q, and 8-K filings.
- Investor Relations: EMCOR website for the Q4 2025 earnings press release and July 2025 Investor Presentation.
- Key Peers for Benchmarking: Comfort Systems USA (FIX), Quanta Services (PWR), MasTec (MTZ), API Group (APG), and Stantec (STN).
- Industry Data Sources: Dodge Construction Network (for non-residential construction starts), Engineering News-Record (ENR) for specialty contractor rankings, and U.S. Census Bureau construction spending data.
- Consensus Estimates: FactSet or Bloomberg for forward-looking street estimates on revenue and EPS.
Sources
- EMCOR Group, Inc. Q4 and Full Year 2025 Earnings Press Release (Business Wire, 26 February 2026).
- EMCOR Group, Inc. 2025 Form 10-K.
- EMCOR Group, Inc. Investor Presentation (July 2025).
- Investing.com Q4 2025 Earnings Call Highlights for EMCOR Group.
- TradingView SEC 10-K Summary for EMCOR Group (February 2026).
Do more with the Emcor model
Frequently asked
What services does Emcor Group Inc. provide?+
Emcor Group, Inc. is a leading specialty contractor in the United States, offering electrical and mechanical construction, industrial and energy infrastructure, and building services. The company designs, installs, operates, and maintains complex systems like HVAC, electrical, and plumbing for commercial, industrial, healthcare, and institutional clients.
How does Emcor generate its revenue?+
Emcor generates revenue through its four primary ongoing segments: US Electrical Construction, US Mechanical Construction, US Building Services, and US Industrial Services. Revenue growth is driven by the conversion of remaining performance obligations (backlog) and benefits from secular tailwinds such as data center construction.
What is Emcor's capital expenditure strategy?+
Emcor operates an asset-light business model, with capital expenditures typically ranging from 0.5% to 1.0% of revenue. These expenditures are almost entirely for maintenance, focusing on replacing vehicle fleets, IT systems, and tools rather than major construction.
What is the primary purpose of the Emcor financial model?+
The Emcor financial model serves as a comprehensive equity valuation and scenario planning tool for analysts. It enables forecasting of earnings and cash flow based on factors like backlog conversion, segment-level margin sustainability, and capital allocation strategies.
Is a downloadable financial model available for Emcor?+
Yes, an Excel-based financial model for Emcor is available for download. This model provides a detailed framework for analysts to perform their own forecasts and scenario planning for the company's financial performance.
How do acquisitions affect Emcor's balance sheet?+
Acquisitions significantly impact Emcor's balance sheet, with goodwill and identifiable intangible assets often representing a large portion of total assets. The company is a serial acquirer, frequently executing bolt-on deals and occasional transformational acquisitions.
Have more financial modelling questions? Contact us
Created by ex-finance professionals
Hey, I’m Alex and I created Finamodel.
Over my years in the finance industry I kept building the same models over and over again. Same structure, same assumptions, different logo. So I started building frameworks to turn them into clean, reusable templates.
Every model here is one I’d actually use for a client, and I personally vet each one before it goes up.
I’m not an expert in every industry, but I’ve built enough models to know what belongs in one. And when something is completely foreign to me, I reach out to my network for experts to work on our models with us.
Having a template library on hand cuts a first build from hours to minutes.
Need help finding your model? You’ll find me in the Finamodel app!
Other Construction Company Financial Models
Browse another company in the same sector.
D. R. Horton
D.
Comfort Systems USA
Comfort Systems USA is a leading national provider of mechanical, electrical, and plumbing (MEP) contracting services, focusing heavily on commercial, industrial, and institutional markets.
Jacobs Solutions
Jacobs Solutions is a premier global professional services company that designs and deploys technology-centric solutions to solve complex challenges in infrastructure, advanced manufacturing, and consulting.
Lennar
Lennar Corporation is one of the largest homebuilders in the United States, constructing affordable, move-up, and active adult homes across 30 states.
NVR
NVR is one of the largest homebuilders in the United States, operating primarily under the Ryan Homes, NVHomes, and Heartland Homes brands through Homebuilding and Mortgage Banking segments across the Mid Atlantic, North East, Mid East, and South East regions.
PulteGroup
PulteGroup is the third-largest homebuilding company in the United States, acquiring and developing land and constructing single-family detached and attached homes across 46 markets under brands such as Centex, Pulte Homes, and Del Webb.
Quanta Services
Quanta Services is a leading specialised contracting services company, delivering comprehensive infrastructure solutions for the utility, renewable energy, technology, communications, and pipeline industries.
Explore more Manufacturing financial model templates.
