As the Q4 earnings season wraps, let’s dig into this quarter’s best and worst performers in the energy products and services industry, including Ameresco (NYSE:AMRC) and its peers.
Areas like the energy transition and emission reduction are thematic and front of mind today. This can be a double-edged sword for the energy products and services industry. Those who innovate and build new expertise can jolt demand while those who cling to legacy technologies or fall behind in the trending areas could see their market shares diminish. Bigger picture, energy products and services companies are still at the whim of construction and infrastructure project volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates.
The 4 energy products and services stocks we track reported a softer Q4. As a group, revenues missed analysts’ consensus estimates by 11.7%.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 28.6% since the latest earnings results.
Ameresco (NYSE:AMRC)
Having played a role in upgrading the energy solutions of Alcatraz Island, Ameresco (NYSE:AMRC) provides energy and renewable energy solutions for various sectors.
Ameresco reported revenues of $532.7 million, up 20.7% year on year. This print exceeded analysts’ expectations by 1.1%. Despite the top-line beat, it was still a slower quarter for the company with full-year EBITDA guidance missing analysts’ expectations.
CEO George Sakellaris commented, “The fourth quarter represented a strong and resilient finish to an excellent year for Ameresco. Our team continued to deliver solid results in a dynamic business environment while positioning the Company for future growth and adding to our multi-year visibility. Our record revenue performance was driven by growth across our business lines, reflecting robust demand for cost effective projects that provide energy savings and resilience. This was also a record quarter in project contract conversions with over $1 billion, bringing our contracted project backlog to over $2.5 billion at year-end, approximately twice 2023 levels. We also placed a record 241 MWe of energy assets into service during the year. These accomplishments have added considerably to our total multiyear revenue visibility which now stands at almost $10 billion. During the quarter, we also successfully divested our AEG business unit allowing us to remain focused on our core businesses and the exciting growth opportunities within our target markets.”
Ameresco scored the biggest analyst estimates beat and fastest revenue growth, but had the weakest full-year guidance update of the whole group. Still, the market seems discontent with the results. The stock is down 15.2% since reporting and currently trades at $10.19.
Read our full report on Ameresco here, it’s free.
Best Q4: Quanta (NYSE:PWR)
A construction engineering services company, Quanta (NYSE:PWR) provides infrastructure solutions to a variety of sectors, including energy and communications.
Quanta reported revenues of $6.55 billion, up 13.3% year on year, falling short of analysts’ expectations by 1%. However, the business still had a very strong quarter with a solid beat of analysts’ EBITDA estimates.
Quanta pulled off the highest full-year guidance raise among its peers. The market seems unhappy with the results as the stock is down 15.2% since reporting. It currently trades at $247.47.
Is now the time to buy Quanta? Access our full analysis of the earnings results here, it’s free.
Slowest Q4: FTAI Infrastructure (NASDAQ:FIP)
Spun off from FTAI Aviation in 2021, FTAI Infrastructure (NASDAQ:FIP) invests in and operates infrastructure and related assets across the transportation and energy sectors.
FTAI Infrastructure reported revenues of $80.76 million, flat year on year, falling short of analysts’ expectations by 14.8%. It was a disappointing quarter as it posted a significant miss of analysts’ EPS estimates.
As expected, the stock is down 41.3% since the results and currently trades at $3.34.
Read our full analysis of FTAI Infrastructure’s results here.
MDU Resources (NYSE:MDU)
Founded to provide electricity to towns in Minnesota, MDU Resources (NYSE:MDU) provides products and services in the utilities and construction materials industries.
MDU Resources reported revenues of $535.5 million, down 52.8% year on year. This print missed analysts’ expectations by 32.3%. Overall, it was a disappointing quarter as it also logged full-year EPS guidance missing analysts’ expectations.
MDU Resources had the weakest performance against analyst estimates and slowest revenue growth among its peers. The stock is down 13.5% since reporting and currently trades at $15.54.
Read our full, actionable report on MDU Resources here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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