Comfort Systems USA (FIX)
Industrial / Contratación MEP
Fairly valued — Comfort Systems USA is a capital-light mechanical and electrical installation contractor with an exceptional ROIC (~103% on invested capital) and a backlog driven by the data center boom, but trades at an entry multiple (~31x EV/EBIT) well above the 16x exit multiple anchoring the base case, leaving an expected return of +8% annually over 5 years.
- Price
- $1,567.41
- Intrinsic value (5y, base)
- $2,283
- Total annual return (5y)
- 8.1%
- Status (nominal)
- Fairly valued
- Margin of safety
- +16%
The essentials
- Backlog of $14,060 million as of Jun-2026 (+73% year-over-year), with growing focus on data centers and technology
- ROIC of ~103% on invested capital: a nearly asset-light business, partly funded by negative working capital
- Trades at ~31x EV/EBIT today, well above the 16x exit multiple anchoring the base case
Intrinsic value — two valuation methods
Total return at 5 years: 8.1%/year = 7.8% appreciation + 0.3% dividend. The target price ($2,285) is ex-dividend; the $28 in dividends collected over 5 years are added separately.
By both methods, the value today (DCF $1,688 · Multiples $1,858) exceeds the market price ($1,567).
Pillars of the analysis
The verdict — today vs 5 years
Today — fairly valued: at $1,567 trades ~15.6% below its value discounted to today (~$1,858); the discount is positive but does not reach the margin of safety we require (≥38%).
At 5 years — En valor: the target price ($2,285) plus dividends yield between the 4% floor and the 10% average return — a reasonable return, though without the margin of a great investment.
The bridge: the return at 5 years exceeds the risk-free rate (4.5%) — but the discount does not reach the required margin of safety (≥38%). To require a 15% annual return, it would need to be bought at ~$1,154.
Thesis
The business
Comfort Systems USA is a mechanical and electrical installation contractor with an exceptional ROIC (~103% on invested capital) and a capital-light model partly funded by negative working capital. Current growth is extraordinary (+46% year-over-year TTM) but is inflated by recent acquisitions and the data center boom; a meaningful portion is not extrapolable without adjustment.
The valuation
It is valued on EV/EBIT, with a 16x exit multiple in the base case (within the industrial band of 12-18x). The 5-year value comes from projecting EBIT along a path that decelerates from 30% to 8% annual growth, applying that multiple to the terminal year, and adding accumulated cash.
The margin of safety
It trades close to intrinsic value, far from the required margin of safety. Today's price implies paying ~31x EV/EBIT, well above the base case's 16x exit multiple; the expected return is +8% annually over 5 years, Fairly valued.
What to watch
The central disconfirmer is the concentration in technology (45% of 2025 revenue tied to data centers): if that cycle cools sooner than expected, both growth and the multiple could correct at once, hitting value on two fronts.
Educational / informational. Does not constitute investment advice.