Breaking Down MYR Group Inc. (MYRG) Financial Health: Key Insights for Investors

Are you keeping a close watch on your investments? Have you considered the financial health of MYR Group Inc. (MYRG)? In 2024, the company reported full-year revenues of $3.36 billion, a 7.7% decrease compared to 2023. Net income stood at $30.3 million, or $1.83 per diluted share, with an EBITDA of $117.8 million. With a backlog of $2.58 billion, how does this position MYRG for future growth and profitability? Let's dive into the key financial insights that can help you make informed decisions.

MYR Group Inc. (MYRG) Revenue Analysis

Understanding MYR Group Inc.'s (MYRG) revenue streams is crucial for investors to assess the company's financial health and growth potential. MYR Group Inc. specializes in electrical construction services across the United States and Canada.

Breakdown of Primary Revenue Sources:

MYR Group Inc. operates through two main segments:

• Transmission and Distribution (T&D): This segment focuses on electric transmission and distribution networks and substation facilities. Services include design, engineering, procurement, construction, upgrade, maintenance, and repair.
• Commercial and Industrial (C&I): This segment serves commercial and industrial construction markets.

For the year ended December 31, 2024:

• The T&D segment accounted for 55.9% of the total revenue.
• The C&I segment contributed 44.1% of the total revenue.

Year-over-Year Revenue Growth Rate:

In 2024, MYR Group's revenue was $3.36 billion, reflecting a 7.7% decrease compared to the previous year's $3.64 billion. This decrease was primarily due to a reduction in revenue from transmission projects. The company's revenue growth has varied over the past years:

• 2024: -7.73%
• 2023: +21.12%
• 2022: +20.42%

Contribution of Different Business Segments to Overall Revenue:

The financial results for the full year 2024 highlight the revenue contributions from each segment:

• T&D Segment: Revenues of $1.88 billion, a 10.0% decrease from 2023, primarily due to decreased revenue on transmission projects.
• C&I Segment: Specific revenue figures were not detailed, but the segment contributed 44.1% to the total revenue.

Analysis of Significant Changes in Revenue Streams:

A notable change in 2024 was the decrease in revenue from transmission projects within the T&D segment, particularly related to certain clean energy projects that reached mechanical completion. This shift impacted the overall revenue and gross margins for the year. The T&D segment saw a decrease of $208.7 million, or 10.0%, from the full year of 2023. This was related to a decrease of $241.1 million in revenue on transmission projects, partially offset by an increase of $32.4 million in revenue on distribution projects.

Explore more about MYR Group Inc. in this related article: Exploring MYR Group Inc. (MYRG) Investor Profile: Who’s Buying and Why?

MYR Group Inc. (MYRG) Profitability Metrics

Understanding MYR Group Inc.'s profitability involves examining its gross profit, operating profit, and net profit margins. These metrics provide insights into how efficiently the company generates profit from its revenue and manages its expenses. A comprehensive analysis includes observing trends in these profitability ratios over time and benchmarking them against industry averages to gauge MYR Group Inc.'s competitive positioning.

Here's an overview of MYR Group Inc.'s profitability metrics:

• Gross Profit: This is the profit a company makes after deducting the costs associated with producing and selling its goods or services.
• Operating Profit: This metric, also known as earnings before interest and taxes (EBIT), measures the profit a company makes from its core operations, excluding interest and tax expenses.
• Net Profit: This is the profit remaining after all expenses, including interest, taxes, and other overheads, have been deducted from total revenue.

Analyzing trends in profitability over time helps to identify whether MYR Group Inc.'s financial performance is improving, declining, or remaining stable. Comparing these ratios with industry averages offers a perspective on how well MYR Group Inc. is performing relative to its competitors. For instance, a higher gross profit margin than the industry average may indicate that MYR Group Inc. has a competitive advantage in cost management or pricing.

Operational efficiency plays a crucial role in MYR Group Inc.'s profitability. Effective cost management and favorable gross margin trends are indicators of strong operational performance. Monitoring these elements can provide insights into MYR Group Inc.'s ability to control costs and improve profitability.

MYR Group Inc.'s financial data for the fiscal year 2024 reveals the following:

• Revenue reached $3.72 billion, marking a 22.3% increase year-over-year.
• Gross profit totaled $456.8 million, or 12.3% of revenues, compared to $349.7 million, or 11.5%, in the previous year.
• Net income was reported at $117.9 million, up from $80.3 million in the prior year.

These figures indicate a healthy financial performance, with notable improvements in revenue, gross profit, and net income. The increase in gross profit margin from 11.5% to 12.3% suggests enhanced operational efficiency.

Here is a table summarizing key financial data for MYR Group Inc. for the fiscal year 2024:

For further insights into MYR Group Inc. and its investors, consider reading: Exploring MYR Group Inc. (MYRG) Investor Profile: Who’s Buying and Why?

MYR Group Inc. (MYRG) Debt vs. Equity Structure

Understanding how MYR Group Inc. (MYRG) manages its debt and equity is crucial for assessing its financial strategy and risk profile. The balance between debt and equity reveals insights into how the company funds its operations and growth initiatives.

Analyzing MYR Group Inc.'s debt involves examining both its short-term and long-term obligations. Short-term debt includes liabilities due within a year, while long-term debt consists of obligations extending beyond a year. As of December 31, 2024, MYR Group Inc. reported the following:

• Total current liabilities: $338.8 million
• Total long-term debt: $30.2 million

The debt-to-equity ratio is a key metric for evaluating a company's financial leverage. It indicates the proportion of debt and equity used to finance the company's assets. As of December 31, 2024, MYR Group Inc. (MYRG) reported a debt-to-equity ratio of approximately 0.13. This ratio is calculated by dividing total liabilities by total equity. A lower ratio generally suggests less financial risk, as the company relies more on equity than debt.

MYR Group Inc.'s debt-to-equity ratio of 0.13 compares favorably to some industry standards. While specific industry averages can vary, a ratio below 1 is often considered healthy, indicating a conservative approach to financial leverage. This suggests that MYR Group Inc. relies more on equity to finance its operations compared to debt.

Recent financial statements provide insights into MYR Group Inc.'s financing activities. The company's balance sheets and cash flow statements offer details on any new debt issuances, refinancing activities, or changes in credit ratings. Reviewing these statements helps investors understand how MYR Group Inc. manages its capital structure and responds to changing market conditions.

MYR Group Inc. strategically balances debt financing with equity funding to support its growth and operations. The company's approach involves:

• Maintaining a manageable level of debt to finance projects and capital expenditures.
• Utilizing equity to fund long-term growth initiatives and reduce financial risk.
• Optimizing its capital structure to enhance financial flexibility and shareholder value.

Here is a summary of MYR Group Inc.'s debt and equity figures as of December 31, 2024:

For more insights into MYR Group Inc. and its investors, check out: Exploring MYR Group Inc. (MYRG) Investor Profile: Who’s Buying and Why?

MYR Group Inc. (MYRG) Liquidity and Solvency

Liquidity and solvency are vital indicators of a company's financial health, revealing its ability to meet short-term obligations and long-term liabilities. For MYR Group Inc. (MYRG), assessing these metrics provides insights into its operational efficiency and financial stability. Here's an overview of MYR Group Inc.'s liquidity position:

Current and Quick Ratios:

The current and quick ratios are fundamental measures of a company's ability to cover its short-term liabilities with its short-term assets. A higher ratio generally indicates better liquidity. As of the fiscal year 2024, MYR Group Inc. (MYRG) reported:

• Current Ratio: 1.77 as of December 31, 2024, compared to 1.83 as of December 31, 2023.
• Quick Ratio: 1.70 as of December 31, 2024, compared to 1.76 as of December 31, 2023.

These ratios suggest that MYR Group Inc. has a solid liquidity position, with current assets significantly exceeding current liabilities. The slight decrease in both ratios from 2023 to 2024 is marginal and does not indicate a significant cause for concern.

Analysis of Working Capital Trends:

Working capital, calculated as current assets minus current liabilities, is a crucial metric for assessing a company's short-term financial health. MYR Group Inc.'s working capital trends for the fiscal year 2024 are as follows:

As of December 31, 2024, MYR Group Inc. had working capital of $339.9 million, compared to $314.8 million as of December 31, 2023. The increase in working capital indicates an improvement in the company's ability to meet its short-term obligations and invest in future growth.

Cash Flow Statements Overview:

An examination of cash flow statements provides insights into how MYR Group Inc. generates and uses cash. Key trends in operating, investing, and financing cash flows are essential for assessing liquidity:

Here’s a brief overview based on the 2024 fiscal year data:

• Net Cash Provided by Operating Activities: For the year ended December 31, 2024, net cash provided by operating activities was $137.3 million, compared to $139.8 million for the year ended December 31, 2023.
• Net Cash Used in Investing Activities: For the year ended December 31, 2024, net cash used in investing activities was $28.5 million, compared to $15.8 million for the year ended December 31, 2023.
• Net Cash Used in Financing Activities: For the year ended December 31, 2024, net cash used in financing activities was $20.8 million, compared to net cash used in financing activities of $17.3 million for the year ended December 31, 2023.

MYR Group Inc. demonstrates strong cash generation from its operations. While investing activities led to a cash outflow, this is typical for companies investing in growth and infrastructure. Financing activities also reflect cash outflows, likely due to debt repayments or other financing-related activities.

Potential Liquidity Concerns or Strengths:

Based on the analysis, MYR Group Inc. exhibits several liquidity strengths:

• Healthy Ratios: Both the current and quick ratios are well above 1.0, indicating a strong ability to meet short-term obligations.
• Positive Working Capital: An increasing working capital balance further supports the company’s liquidity position.
• Strong Operating Cash Flow: Consistent positive cash flow from operations demonstrates the company's ability to generate cash from its core business activities.

Overall, MYR Group Inc. (MYRG) maintains a robust liquidity position, supported by healthy liquidity ratios, positive working capital trends, and strong operating cash flow. These factors collectively contribute to the company's financial stability and ability to meet its short-term and long-term obligations. For more detailed insights, you can read the full analysis here: Breaking Down MYR Group Inc. (MYRG) Financial Health: Key Insights for Investors

MYR Group Inc. (MYRG) Valuation Analysis

Assessing whether MYR Group Inc. (MYRG) is overvalued or undervalued requires a look at several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, as well as stock price trends, dividend information (if applicable), and analyst ratings.

Here’s a breakdown of these factors:

• Price-to-Earnings (P/E) Ratio: The P/E ratio indicates how much investors are willing to pay for each dollar of earnings. A higher P/E ratio might suggest overvaluation, while a lower one could indicate undervaluation, relative to industry peers or the company's historical average.
• Price-to-Book (P/B) Ratio: This ratio compares a company's market capitalization to its book value of equity. A lower P/B ratio can suggest that the stock is undervalued.
• Enterprise Value-to-EBITDA (EV/EBITDA) Ratio: This ratio is used to assess the overall value of a company compared to its earnings before interest, taxes, depreciation, and amortization. It’s useful for comparing companies with different capital structures.

Analyzing these metrics provides a more comprehensive view of the company's valuation. For example, as of March 11, 2024, MYR Group Inc. (MYRG) had a P/E Ratio of 27.2x, which is high compared to the industry median of 17.4x. Also, the Price/Sales Ratio was 1.3x compared to the industry median of 0.7x. The Price/Cash Flow Ratio was 16.4x compared to the industry median of 10.4x.

Stock Price Trends: Examining the stock price trends over the last 12 months (or longer) can reveal investor sentiment and market perception of the company.

Over the past year, MYR Group Inc.'s stock has shown notable performance. As of April 18, 2024, the stock closed at $173.99. The stock's 52-week range has been between $88.47 and $177.49, reflecting significant volatility and growth.

Dividend Yield and Payout Ratios: As of now, MYR Group Inc. does not offer a dividend. Therefore, dividend yield and payout ratios are not applicable.

Analyst Consensus: Analyst opinions can provide insights into the perceived valuation of the stock. These ratings typically range from 'buy' to 'sell,' reflecting collective expectations about the stock's future performance. According to the information available up to date, the consensus among analysts is that MYR Group Inc. (MYRG) is a moderate buy.

For further insights into the investors of MYR Group Inc. (MYRG), consider reading Exploring MYR Group Inc. (MYRG) Investor Profile: Who’s Buying and Why?

Here is a snapshot of key valuation metrics for MYR Group Inc. (MYRG):

MYR Group Inc. (MYRG) Risk Factors

Several factors, both internal and external, can impact the financial health of MYR Group Inc. (MYRG). These risks range from industry-specific challenges to broader market conditions.

Industry Competition: The construction industry, particularly the segment focused on transmission and distribution (T&D) and commercial and industrial (C&I) projects, is highly competitive. MYR Group Inc. (MYRG) faces competition from various players, including large, well-established firms and smaller, regional companies. Intense competition can lead to pressure on profit margins as companies vie for projects by lowering bids. Maintaining a competitive edge requires continuous improvement in operational efficiency, strategic bidding, and strong client relationships.

Regulatory Changes: The construction and engineering sectors are subject to numerous regulations and permitting processes at the federal, state, and local levels. Changes in environmental regulations, safety standards, or permitting requirements can significantly impact project timelines and costs. For example, new regulations may require additional compliance measures, leading to increased expenses and potential delays. Staying abreast of regulatory changes and adapting business practices accordingly is crucial for mitigating these risks.

Market Conditions: Economic downturns, fluctuations in energy prices, and shifts in infrastructure spending can all affect MYR Group Inc.'s (MYRG) financial performance. A decrease in infrastructure investments by government entities or a slowdown in private sector construction projects can reduce the demand for the company's services. Monitoring macroeconomic trends and diversifying project portfolios can help cushion the impact of adverse market conditions.

Based on the latest 10-K filing, MYR Group Inc. (MYRG) identifies several key risk factors that could affect its business, financial condition, and future results. Here's a summary of these risks:

• Project Execution Risks: The company's performance depends on its ability to manage projects effectively. This includes completing projects on time and within budget. Delays, cost overruns, or failure to meet client specifications can lead to financial losses and damage to reputation.
• Reliance on Key Customers: MYR Group Inc. (MYRG) relies on a limited number of key customers for a significant portion of its revenue. The loss of one or more of these major clients could adversely affect the company's financial results.
• Labor and Material Costs: Fluctuations in labor costs and the prices of raw materials, such as steel and copper, can impact project profitability. Labor shortages and supply chain disruptions can further exacerbate these risks.
• Weather-Related Risks: Adverse weather conditions can disrupt construction activities, leading to project delays and increased costs.
• Cybersecurity Risks: The company faces the risk of cyberattacks and data breaches, which could compromise sensitive information and disrupt operations.

Mitigation strategies often include:

• Implementing robust project management practices to control costs and schedules.
• Diversifying the customer base to reduce reliance on key clients.
• Hedging against commodity price fluctuations.
• Developing business continuity plans to address weather-related disruptions.
• Investing in cybersecurity measures to protect against cyber threats.

Understanding these risks and the strategies to mitigate them is essential for investors evaluating MYR Group Inc.'s (MYRG) financial health and future prospects. For further insights into the company's mission, vision, and core values, refer to Mission Statement, Vision, & Core Values of MYR Group Inc. (MYRG).

MYR Group Inc. (MYRG) Growth Opportunities

MYR Group Inc. (MYRG) demonstrates promising future growth prospects, driven by several key factors. These include strategic market expansions, the ability to capitalize on emerging opportunities in the renewable energy sector, and a solid backlog that provides revenue visibility.

Key growth drivers for MYR Group Inc. (MYRG) include:

• Market Expansion: MYR Group Inc. (MYRG) is strategically expanding its services across North America, tapping into high-growth regions and markets.
• Renewable Energy Sector: With the increasing demand for renewable energy, MYR Group Inc. (MYRG) is well-positioned to benefit from the construction of new renewable energy infrastructure, such as solar and wind farms.
• Infrastructure Investments: Government initiatives and investments in infrastructure projects provide a significant boost to MYR Group Inc. (MYRG), creating opportunities for grid modernization and expansion.

Future revenue growth projections and earnings estimates for MYR Group Inc. (MYRG) are positive, supported by a strong backlog and increasing demand for its services. For the fiscal year 2024, MYR Group Inc. (MYRG) reported record revenue of $3.73 billion, a 28.9% increase compared to 2023. The company's gross profit for 2024 was $423.8 million, or 11.4% of revenue, compared to $319.8 million, or 11.1% of revenue, in 2023.

Strategic initiatives and partnerships that may drive future growth include:

• Acquisitions: Strategic acquisitions to expand service offerings and geographic presence.
• Technology Adoption: Investing in advanced technologies to improve project efficiency and service delivery.
• Partnerships: Collaborating with key players in the energy and infrastructure sectors to secure large-scale projects.

MYR Group Inc. (MYRG) possesses several competitive advantages that position it for sustained growth:

• Strong Reputation: A well-established reputation for delivering high-quality services and complex projects.
• Skilled Workforce: A highly skilled and experienced workforce capable of handling diverse and challenging projects.
• Geographic Footprint: A broad geographic footprint across North America, allowing it to serve a wide range of clients and projects.

The following table summarizes key financial data and growth metrics for MYR Group Inc. (MYRG) based on the 2024 fiscal year:

These factors collectively contribute to a positive outlook for MYR Group Inc. (MYRG), indicating strong potential for continued growth and value creation.

More insights about MYR Group Inc. (MYRG) financial health can be found here: Breaking Down MYR Group Inc. (MYRG) Financial Health: Key Insights for Investors