EMCOR Group (NYSE:EME) and Energy Services of America (NASDAQ:ESOA) Critical Review

Energy Services of America (NASDAQ:ESOA) and EMCOR Group (NYSE:EME) are both industrials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, earnings, risk, profitability, valuation and dividends.

Earnings & Valuation

This table compares Energy Services of America and EMCOR Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Energy Services of America	$467.37 million	N/A	N/A	$0.18	47.65
EMCOR Group	$16.99 billion	1.70	$1.27 billion	$34.62	19.03

EMCOR Group has higher revenue and earnings than Energy Services of America. EMCOR Group is trading at a lower price-to-earnings ratio than Energy Services of America, indicating that it is currently the more affordable of the two stocks.

Dividends

Energy Services of America pays an annual dividend of $0.16 per share and has a dividend yield of 1.8%. EMCOR Group pays an annual dividend of $1.60 per share and has a dividend yield of 0.2%. Energy Services of America pays out 87.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. EMCOR Group pays out 4.6% of its earnings in the form of a dividend. EMCOR Group has increased its dividend for 5 consecutive years.

Profitability

This table compares Energy Services of America and EMCOR Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Energy Services of America	N/A	N/A	N/A
EMCOR Group	7.78%	36.65%	14.50%

Insider & Institutional Ownership

2.1% of Energy Services of America shares are owned by institutional investors. Comparatively, 92.6% of EMCOR Group shares are owned by institutional investors. 44.7% of Energy Services of America shares are owned by company insiders. Comparatively, 0.7% of EMCOR Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for Energy Services of America and EMCOR Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Energy Services of America	0	2	2	0	2.50
EMCOR Group	0	3	7	0	2.70

Energy Services of America presently has a consensus target price of $22.50, suggesting a potential upside of 158.03%. EMCOR Group has a consensus target price of $902.88, suggesting a potential upside of 37.02%. Given Energy Services of America’s higher possible upside, equities research analysts plainly believe Energy Services of America is more favorable than EMCOR Group.

Summary

EMCOR Group beats Energy Services of America on 10 of the 14 factors compared between the two stocks.

About Energy Services of America

Energy Services of America Corporation is a specialty contracting company serving natural gas, petroleum, water and wastewater, and electric utility markets. The company installs, repairs, and replaces pipelines and utility systems for commercial, industrial, and public-sector customers. Its work includes pipeline construction and maintenance, water and sewer line installation, electrical services, and related site work. The company also performs services such as horizontal directional drilling, trenching, welding, and pipeline testing.

About EMCOR Group

EMCOR Group is a provider of mechanical and electrical construction and facilities services. Through its operating companies, it designs, installs, maintains and upgrades building systems and related infrastructure for commercial, industrial, institutional and government customers. Its services include heating, ventilation and air conditioning; electrical and power systems; plumbing and piping; building automation; energy infrastructure; and ongoing facilities management. The company also provides industrial services, such as maintenance and support for process and manufacturing facilities.