FIX
IndustrialsComfort Systems USA
Price Chart
Market Data
Financials
XBRL · SEC EDGAR2009–2025(17yr)| Metric | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $1.1B | $1.1B | $1.2B | $1.3B | $1.4B | $1.4B | $1.6B | $1.6B | $1.8B | $2.2B | $2.6B | $2.9B | $3.1B | $4.1B | $5.2B | $7.0B | $9.1B | +29.5% |
| Gross Profit | $225.6M | $188.7M | $181.5M | $207.6M | $239.9M | $249.8M | $318.1M | $344.0M | $366.3M | $446.3M | $501.9M | $547.0M | $563.2M | $741.6M | $990.5M | $1.5B | $2.2B | +48.7% |
| Gross Margin | 20.0% | 17.0% | 14.6% | 15.6% | 17.7% | 17.7% | 20.1% | 21.0% | 20.5% | 20.4% | 19.2% | 19.1% | 18.3% | 17.9% | 19.0% | 21.0% | 24.1% | +3.1pp |
| Operating Income | $56.6M | $20.0M | -$49.4M | $22.3M | $46.3M | $42.2M | $90.0M | $101.6M | $99.3M | $150.2M | $163.6M | $190.7M | $188.4M | $253.8M | $418.4M | $749.4M | $1.3B | +75.4% |
| Operating Margin | 5.0% | 1.8% | -4.0% | 1.7% | 3.4% | 3.0% | 5.7% | 6.2% | 5.6% | 6.9% | 6.3% | 6.7% | 6.1% | 6.1% | 8.0% | 10.7% | 14.4% | +3.8pp |
| Net Income | $34.2M | $14.7M | -$36.5M | $11.8M | $27.3M | $23.1M | $49.4M | $64.9M | $55.3M | $112.9M | $114.3M | $150.1M | $143.3M | $245.9M | $323.4M | $522.4M | $1.0B | +95.7% |
| Net Margin | 3.0% | 1.3% | -2.9% | 0.9% | 2.0% | 1.6% | 3.1% | 4.0% | 3.1% | 5.2% | 4.4% | 5.3% | 4.7% | 5.9% | 6.2% | 7.4% | 11.2% | +3.8pp |
| Free Cash Flow | $44.8M | $25.1M | $21.0M | $18.7M | $21.0M | $23.4M | $77.1M | $68.0M | $78.6M | $119.9M | $110.3M | $262.4M | $157.8M | $253.2M | $544.7M | $738.0M | $1.0B | +39.8% |
| FCF Margin | 4.0% | 2.3% | 1.7% | 1.4% | 1.5% | 1.7% | 4.9% | 4.2% | 4.4% | 5.5% | 4.2% | 9.2% | 5.1% | 6.1% | 10.5% | 10.5% | 11.3% | +0.8pp |
| EPS (Diluted) | $0.89 | $0.39 | $-0.99 | $0.36 | $0.73 | $0.61 | $1.30 | $1.72 | $1.47 | $3.00 | $3.08 | $4.09 | $3.93 | $6.82 | $9.01 | $14.60 | $28.88 | +97.8% |
1. THE BIG PICTURE
Comfort Systems USA is successfully pivoting from a traditional mechanical contractor into a high-growth technical services firm by aggressively consolidating the fragmented HVAC and electrical markets. By coupling a record $11.94 billion backlog with a "design and build" model that prioritizes long-term owner relationships over one-off bidding, Comfort Systems USA has achieved a growth trajectory that significantly outpaces its larger industrial peers.
2. WHERE THE RISKS HIT HARDEST
Comfort Systems USA’s "design and build" expertise is its primary competitive strength, yet this consultative approach is threatened by contractual cost overruns because Comfort Systems USA bears the financial risk for labor and material inflation on fixed-price projects (10-K Item 1). While its scale and 190 locations provide a strategic advantage over local shops, this footprint is threatened by economic cyclicality; because construction projects have long lifecycles, Comfort Systems USA often feels the sting of a recession long after the broader economy has already begun to contract (10-K Item 1A). Furthermore, the operational stability provided by its large-scale projects is vulnerable to customer concentration, as a single client now accounts for 12.8% of total revenue, creating a significant point of failure if that relationship or the client's budget shifts.
3. WHAT THE NUMBERS SAY TOGETHER
The financial data reveals a company operating at a different speed than its sector. While peers like Johnson Controls (JCI) and Carrier (CARR) saw revenue growth of 2.8% and -3.3% respectively, Comfort Systems USA posted a 29.5% increase (Peer Benchmarking). This growth is not just a result of market demand but a deliberate acquisition strategy, having integrated Century Contractors and Right Way Plumbing & Mechanical in the first half of 2025 alone (10-Q).
While Comfort Systems USA’s gross margin expanded to 24.1% in 2025, it remains structurally lower than peers like Trane Technologies (36.7%) or Ingersoll Rand (43.9%), reflecting the labor-intensive nature of mechanical contracting versus pure equipment manufacturing (Peer Benchmarking). However, Comfort Systems USA’s balance sheet is a distinct outlier: it maintains a net cash position of $719.8 million, whereas all five of its primary peers carry significant net debt, ranging from $1.2 billion to over $10 billion. This cash cushion provides the "financial strength" management cites as a key factor in winning large-scale institutional contracts (10-K Item 1).
4. IS IT WORTH IT AT THIS PRICE?
At a forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations of 31.3x, Comfort Systems USA trades at a 21% premium to the peer median of 25.8x. The market is currently pricing in approximately 10.1% long-term growth (CAPM analysis). This valuation appears supported by Comfort Systems USA’s actual performance, as its 29.5% revenue growth and 11.2% net margin both exceed the requirements of the market-implied growth rate.
However, the sensitivity of this price is high. If growth were to slow to a "base" level of 5.0%—perhaps due to the exhaustion of the current "unprecedented demand" cited by management—the justified multiple would drop to 12.0x, representing a potential 62% downside from current levels (CAPM analysis). The premium is currently justified by the $11.94 billion backlog, which has nearly doubled year-over-year, but investors are essentially betting that Comfort Systems USA can execute on this massive volume without the cost overruns that historically plague fixed-price contracting.
5. WHAT WOULD CHANGE THIS VIEW?
- Cautious if the 12.8% customer reduces its contract volume or if the backlog growth rate turns negative for two consecutive quarters, signaling a peak in the construction cycle.
- Constructive if operating margins move toward the 15% range seen at Ingersoll Rand, indicating that the shift toward modular and off-site construction is successfully reducing labor-related cost volatility.
6. BOTTOM LINE
Structural Advantage: A dominant "design and build" scale combined with a debt-free balance sheet that allows for continuous mid-market acquisitions. Bottom Line: Comfort Systems USA is a high-execution growth story currently priced for perfection, leaving little room for the margin errors common in fixed-price contracting.
1. Top 5 Material Risks
- Economic Cyclicality: Comfort Systems USA operates in industries vulnerable to macroeconomic downturns. Because projects have long lifecycles, Comfort Systems USA experiences the negative impacts of a recession well after the general economy has begun to decline or even after it has started to recover.
- Contractual Cost Overruns: Comfort Systems USA bears the risk of cost overruns in most contracts. Inaccurate estimates regarding labor, materials, commodity prices, or inflation can lead to reduced profits or project losses, particularly when Comfort Systems USA cannot pass these heightened costs to customers.
- Backlog Uncertainty: While Comfort Systems USA reported a backlog of $11.94 billion as of December 31, 2025, this figure does not guarantee future revenue or profit. Projects are subject to scope adjustments or cancellations that can materially affect financial results.
- Customer Concentration: A significant portion of revenue is derived from a limited number of customers. In 2025, one customer represented approximately 12.8% of consolidated revenue, making Comfort Systems USA vulnerable to the loss or non-renewal of contracts with major clients.
- Inflation and Interest Rate Volatility: High inflation increases costs for labor, materials, and utilities. Additionally, rising interest rates increase debt service obligations on Comfort Systems USA’s variable-rate revolving credit facility, which can decrease net income and cash flow.
2. Company-Specific Risks
- Decentralized Management Structure: Comfort Systems USA grants significant decision-making power to local subsidiary management. This structure risks slower identification of business problems or misalignments with overall corporate strategy compared to a centralized model.
- Surety Bond Dependency: Comfort Systems USA’s ability to bid on and perform work is contingent on maintaining sufficient bonding capacity. If surety providers limit or eliminate access to bonds, Comfort Systems USA may be unable to compete for certain projects or be forced to post collateral, which reduces liquidity.
- Acquisition Integration: Future growth relies on selective acquisitions, which carry risks including the assumption of material liabilities, failure of due diligence, and the potential for management distraction during the integration of geographically dispersed personnel.
- Workforce Utilization: Profitability is sensitive to the balance of workforce utilization. Underutilization leads to lower gross margins, while overutilization can negatively impact safety, project execution, and future award potential.
3. Regulatory/Legal Risks
- Government Contracting: Approximately 5.0% of 2025 revenue was attributable to the government sector. Violations of federal, state, or local regulations can result in fines, contract termination, or debarment from future government bidding.
- Environmental Compliance: HVAC operations are subject to the Clean Air Act and regulations regarding ozone-depleting refrigerants. Failure to comply with these or evolving ESG-related reporting requirements could lead to substantial fines or loss of licenses.
- Litigation Exposure: Comfort Systems USA faces ongoing legal proceedings, including potential class actions regarding wage and hour laws and personal injury claims. Inaccurate estimates of these legal exposures can adversely affect financial condition.
- Internal Control Deficiencies: As a public company, Comfort Systems USA must maintain effective internal control over financial reporting. A "material weakness" in these controls could reduce investor confidence and harm Comfort Systems USA's stock price.
4. Financial Impact Map
Economic Cyclicality → Revenue and Profit → Decreased demand leads to greater price competition and potential non-payment from vendors or contractors. Contractual Cost Overruns → Net Income → Inaccurate cost estimates or rising inflation directly reduce project profitability. Backlog Uncertainty → Revenue → Contract cancellations or scope adjustments prevent the realization of the $11.94 billion backlog. Customer Concentration → Consolidated Revenue → Loss of a single customer (12.8% of 2025 revenue) would materially impact top-line results. Interest Rate Volatility → Net Income and Cash Flows → Increased debt service obligations on variable-rate indebtedness reduce available cash.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 8-K | Feb 2026 | — |
| 10-K | Feb 2026 | Dec 2025 |
| 10-Q | Oct 2025 | Sep 2025 |
| 14A | Apr 2025 | — |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
Comfort Systems Q4 Net Income $330.8M, Revenue $2.65B, Backlog Hits Record $11.94B
- ▸Q4 net income $330.8M ($9.37/share) vs $145.9M ($4.09/share) prior year
- ▸Q4 revenue $2.65B vs $1.87B prior year
- ▸Operating cash flow $468.5M vs $210.5M prior year
- ▸Record backlog $11.94B vs $5.99B prior year
- ▸Stock up 53% YTD, outperforming XLI industrial sector ETF
Comfort Systems FY25 EPS $28.88 up 98%, Q4 EPS $9.37 surges 129%
- ▸FY25 EPS $28.88, up 98% from $14.60 in 2024
- ▸Q4 EPS $9.37, up 129% YoY
- ▸Quarterly gross margins exceeded 25% for the first time
- ▸Backlog reached record $12B, up 93% YoY on same-store basis
- ▸Technology work accounts for 45% of total revenue, up from 33%
Comfort Systems USA Q4 Revenue and Net Income Grow YoY on Record Project Backlog
- ▸Q4 2025 results show strong year-over-year growth in sales and net income
- ▸Project backlog reached record levels providing clear revenue visibility
- ▸Return on invested capital (ROIC) increased, signaling improved operational efficiency
- ▸2028 revenue target projected at $10.5B with $1.3B in earnings
- ▸Backlog concentration in tech and data center construction identified as primary risk
Comfort Systems Q4 EPS $9.37 beats $6.77 estimate, revenue $2.65B, backlog doubles to $12B
- ▸Q4 EPS $9.37 vs $6.77 estimate, 38% beat
- ▸Q4 revenue $2.65B vs $2.28B estimate
- ▸Backlog doubled YoY to $12B, visibility through 2027-2028
- ▸Adjusted EBITDA $464M, up from $261M YoY
- ▸Dividend increased 16.7% following $1B+ free cash flow in 2025
Comfort Systems Electrical Segment Revenue Surges 61.9% to $2.43B in 2025
- ▸Electrical segment revenue +61.9% YoY to $2.43B
- ▸Electrical segment margins reached 26.7% in 2025
- ▸Electrical segment contribution to total revenue rose to 27% from 21%
- ▸Mechanical segment revenue grew 20.7% with 23.6% margins
- ▸Growth driven by data center projects and acquisitions of Feyen Zylstra and Meisner
Comfort Systems Q4 EPS $9.37 beats by 38%, revenue $2.65B up 42% YoY
- ▸Q4 EPS $9.37, beating consensus estimates by 38.4%
- ▸Q4 revenue $2.65B, beating consensus estimates by 15.8%
- ▸Backlog $11.94B as of Dec 31, 2025, up 99.3% YoY
- ▸Technology sector revenue share increased to 45% of total 2025 sales
- ▸Q4 gross margin expanded 230 bps to 25.5%
Comfort Systems USA backlog nearly doubles on surge in data center infrastructure demand
- ▸Project backlog nearly doubled year-over-year
- ▸Revenue drivers shifting toward data center and technology infrastructure projects
- ▸Free cash flow margins expanding alongside project pipeline growth
- ▸Stock up 301.4% over the past year
- ▸Trading at 46.9x P/E ratio versus 32.9x industry average