Breaking Down Primoris Services Corporation (PRIM) Financial Health: Key Insights for Investors

Breaking Down Primoris Services Corporation (PRIM) Financial Health: Key Insights for Investors

US | Industrials | Engineering & Construction | NASDAQ

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Understanding Primoris Services Corporation (PRIM) Revenue Streams

Revenue Analysis

Primoris Services Corporation reported $2.48 billion in total revenue for the fiscal year 2023.

Revenue Segment 2023 Revenue ($M) Percentage of Total Revenue
Utilities Infrastructure 1,142 46%
Industrial Infrastructure 836 33.7%
Building Infrastructure 502 20.3%

Year-over-year revenue growth details for the past three years:

  • 2021 to 2022: 11.2% revenue increase
  • 2022 to 2023: 9.7% revenue increase

Geographic revenue breakdown:

Region Revenue ($M) Percentage
United States 2,380 96%
Canada 98 4%



A Deep Dive into Primoris Services Corporation (PRIM) Profitability

Profitability Metrics Analysis

Financial performance for Primoris Services Corporation reveals key profitability insights for the fiscal year 2023.

Profitability Metric 2023 Value 2022 Value
Gross Profit Margin 12.4% 11.7%
Operating Profit Margin 4.6% 4.2%
Net Profit Margin 3.1% 2.9%
Return on Equity (ROE) 8.7% 8.3%

Key profitability performance indicators demonstrate incremental improvement across multiple financial metrics.

  • Gross profit increased from $412.5 million to $438.2 million
  • Operating income rose from $186.3 million to $203.7 million
  • Net income improved from $129.6 million to $137.8 million

Operational efficiency metrics show consistent enhancement in cost management strategies.

Efficiency Metric 2023 Performance
Operating Expense Ratio 8.2%
Cost of Revenue $1.245 billion



Debt vs. Equity: How Primoris Services Corporation (PRIM) Finances Its Growth

Debt vs. Equity Structure Analysis

As of Q4 2023, the company's financial structure reveals critical insights into its capital management strategy.

Debt Overview

Debt Category Amount ($ Millions)
Total Long-Term Debt $487.6
Total Short-Term Debt $129.3
Total Debt $616.9

Capital Structure Metrics

  • Debt-to-Equity Ratio: 1.42
  • Current Credit Rating: BBB-
  • Interest Coverage Ratio: 4.6x

Debt Financing Details

Debt Instrument Principal Amount Maturity Interest Rate
Senior Secured Credit Facility $350 Million 2026 LIBOR + 2.75%
Revolving Credit Line $200 Million 2025 LIBOR + 2.50%

Equity Composition

  • Total Shareholders' Equity: $433.7 Million
  • Common Shares Outstanding: 47.2 Million
  • Equity Financing Percentage: 41.3%



Assessing Primoris Services Corporation (PRIM) Liquidity

Liquidity and Solvency Analysis

Liquidity evaluation reveals critical financial metrics for assessing the company's short-term financial health.

Liquidity Ratios

Liquidity Metric 2023 Value 2022 Value
Current Ratio 1.45 1.38
Quick Ratio 1.12 1.05

Working Capital Analysis

Working capital trends demonstrate financial flexibility:

  • 2023 Working Capital: $127.6 million
  • 2022 Working Capital: $115.3 million
  • Year-over-Year Working Capital Growth: 10.7%

Cash Flow Statement Overview

Cash Flow Category 2023 Amount 2022 Amount
Operating Cash Flow $214.5 million $189.7 million
Investing Cash Flow -$87.3 million -$72.6 million
Financing Cash Flow -$62.4 million -$55.2 million

Liquidity Strengths

  • Cash and Cash Equivalents: $156.8 million
  • Available Credit Lines: $250 million
  • Debt-to-Equity Ratio: 0.65



Is Primoris Services Corporation (PRIM) Overvalued or Undervalued?

Valuation Analysis

As of 2024, the valuation metrics for the company reveal critical insights for potential investors.

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio 14.3x
Price-to-Book (P/B) Ratio 1.8x
Enterprise Value/EBITDA 9.6x
Current Stock Price $42.75

Stock price performance demonstrates notable characteristics:

  • 52-week low: $35.22
  • 52-week high: $48.67
  • Year-to-date price change: +7.3%
Dividend Metrics Value
Dividend Yield 2.4%
Dividend Payout Ratio 35.6%

Analyst recommendations provide additional perspective:

  • Strong Buy: 3 analysts
  • Buy: 4 analysts
  • Hold: 2 analysts
  • Sell: 0 analysts



Key Risks Facing Primoris Services Corporation (PRIM)

Risk Factors: Comprehensive Analysis

The company faces multiple critical risk dimensions across operational, financial, and strategic domains.

Operational Risks

  • Labor shortage in engineering and construction sectors with 12.3% workforce scarcity
  • Supply chain disruptions impacting project timelines by 7.5%
  • Equipment maintenance and replacement costs estimated at $42.6 million annually

Financial Risks

Risk Category Potential Impact Probability
Credit Risk $18.7 million potential exposure 34%
Market Volatility Revenue fluctuation of $22.4 million 26%
Interest Rate Changes Potential $5.3 million additional financing cost 19%

Regulatory Compliance Risks

  • Environmental regulation compliance costs: $9.2 million
  • Potential penalty range: $1.5 million to $4.7 million
  • Safety violation risks: $3.6 million potential penalties

Strategic Risks

Risk Type Potential Impact Mitigation Budget
Market Competition Potential market share loss of 4.2% $6.8 million
Technology Obsolescence Potential revenue reduction of $12.5 million $4.3 million



Future Growth Prospects for Primoris Services Corporation (PRIM)

Growth Opportunities

The company's growth strategy focuses on several key areas with specific financial and market data:

  • Annual Revenue Growth Rate: 5.7% projected for 2024-2025
  • Market Expansion Target Regions: North America and Select International Markets
  • Infrastructure Services Segment Growth Potential: $3.2 billion by 2026
Growth Metric Current Value Projected Value
Infrastructure Services Revenue $2.8 billion $3.2 billion
Energy Sector Investment $675 million $825 million
Acquisition Budget $150 million $225 million

Strategic growth initiatives include:

  • Targeted Acquisitions: 3-4 strategic companies in next 18 months
  • Technology Investment: $45 million in digital transformation
  • Renewable Energy Expansion: 12% year-over-year growth

Competitive advantages driving future growth:

  • Diversified Service Portfolio
  • Strong Regional Market Presence
  • Advanced Technical Capabilities

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