MYR GROUP INC. (MYRG): what the price assumes
In the published model solve dated 2026-Q2, anchored at $294.42, MYR GROUP INC. (MYRG) is priced for +23.3% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-06-27.
Generated: 2026-08-31 · Source: https://boothcheck.com/report/MYRG
Headline
| Field | Value |
|---|---|
| Ticker | MYRG |
| Company | MYR GROUP INC. |
| Current price | $294.42/sh |
| Composition | Fixed price 57% / Unit price 22% / T&E (time-and-equipment, time-and-materials and cost-plus) 21% |
What The Price Assumes (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin (value-band context) | 1.7% |
| Operating margin today | 5.6% |
| Margin compression (value-band) | -3.9pp |
| Implied growth | 23.3% |
| Multiple paid | 20x operating income |
The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.
Solve inputs: computed at a 10.5% cost of capital with 4% terminal growth over a 5-year stage.
How unusual the bet is: within-range (limited comparison data)
| Reference | Value |
|---|---|
| vs own history | +0.19σ |
| cohort percentile (of 225 peers) | 50 |
Valuation X-Ray
Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 2.57x | 5 | expensive |
| Earnings | 2.33x | 5 | expensive |
| Relative | 1.54x | 2 | expensive |
| Growth | 0.69x | 3 | justifies |
Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.1%); the inversion above states its own rate.
Per-Model Detail (n=15)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | $562.42 | 0.52x | yes | FCF base $0.3B, growth 16% (input: historical growth), terminal g 4.0%, WACC 9.1%, 6yr projection |
| DCF Exit Multiple | Growth | $426.69 | 0.69x | yes | Exit EV/EBITDA: 16.6x / 18.6x / 20.6x (bear / base = today's held flat / bull), 6yr |
| Relative Valuation | Relative | — | — | no | P/E 20.92x (blended: static sector reference 18x + trailing (TTM) 28x), scenarios: 17.0x / 20.9x / 24.8x (bear / base = reference held flat / bull), EV/EBITDA 13.97x |
| Simple DDM | Growth | — | — | no | — |
| Two-Stage DDM | Growth | — | — | no | — |
| Simple Excess Return | Asset | $114.77 | 2.57x | yes | BV/sh $48.46, ROE (TTM) 21.9%, ke 9.3% |
| Two-Stage Excess Return | Asset | $175.62 | 1.68x | yes | 5yr excess ROE then converge to ke=9.3% |
| Discounted Future Market Cap | Growth | $304.71 | 0.97x | yes | Rev $4.0B, growth 16% (input: historical growth; tapered), Terminal P/S: 0.9x / 1.1x / 1.4x (bear / base = today's held flat / bull, cap 12x) |
| Peter Lynch Fair Value | Relative | $126.48 | 2.33x | yes | EPS $10.54, growth 1% (input: historical EPS growth), PEG=20.23 (Overvalued) |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $74.70 | 3.94x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $0.13B × (1−26%) / WACC 9.1% → EPV (no growth) |
| Residual Income | Asset | $165.10 | 1.78x | yes | BV $48.46 + 5yr PV of (ROE (TTM) 21.9% − Kₑ 9.3%) × BV; BV grows 8.8%/yr |
| Graham Number | Asset | $107.20 | 2.75x | yes | √(22.5 × EPS $10.54 × BVPS $48.46) — Graham's conservative floor |
| EV/EBITDA Relative | Relative | — | — | no | EBITDA $0.24B × sector EV/EBITDA 12.0x |
| FCF Yield | Earnings | $138.61 | 2.12x | yes | FCF $193.4M / Kₑ 9.3% — zero-growth perpetuity |
| SBC-Adj FCF Yield | Earnings | $126.14 | 2.33x | yes | SBC-adj FCF $0.18B (FCF $0.19B − SBC $0.02B) capitalized at Kₑ |
| Ben Graham Formula | Earnings | $340.09 | 0.87x | yes | EPS $10.54 × (8.5 + 2×15.0%) × (4.4 / 5.3%) |
| ROIC-Justified P/B | Asset | $39.03 | 7.54x | yes | BV $48.46 × (ROIC 7.3% / WACC 9.1%) |
| P/Sales Sector | Relative | — | — | no | Revenue $4.01B × sector P/S 2.5x |
| PEG Fair Value | Relative | $395.25 | 0.74x | yes | EPS $10.54 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x |
| Earnings Yield | Earnings | $113.95 | 2.58x | yes | EPS $10.54 / required return 9.3% (Rf 4.3% + ERP 5.0%) |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Economic-Unit Decomposition (Sum Of The Parts)
One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.
| Unit | Role | Valuation basis | Revenue | Reported profit | Value evidence | Status |
|---|---|---|---|---|---|---|
| Transmission & Distribution (T&D) | operating | enterprise | $2.0b | — | withheld | unresolved no unit value |
| Commercial & Industrial (C&I) | operating | enterprise | $1.7b | — | withheld | unresolved no unit value |
No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.
Solvency
| Field | Value |
|---|---|
| Net cash | $126.9m |
| Net debt / NOPAT (after-tax) | -0.76x (net cash) |
| Net debt / operating income (pre-tax) | -0.56x (net cash) |
| Interest coverage | 61.0x |
| Share count CAGR (buyback) | -2.0% |
| Burning cash | no |
Bullet Takeaways
MYR Group is an electrical construction contractor with two segments, transmission and distribution and commercial and industrial, and the moat is operational rather than proprietary: scale, a bonded track record, and the ability to take on the largest grid and data-center jobs. Trailing operating margin is about 5.2%, and on a record quarter the gross margin improved as higher-contract-margin work flowed through.
At roughly $461 (June 27, 2026) the price pays about 38x company-wide operating income, which implies operating growth held at the self-funding ceiling for about 10 years. Only the growth-DCF reaches the price; the asset, earnings-power, and peer-multiple frames all land below it, so the quote is a durability bet on compounding the static methods cannot capture.
The balance sheet is a genuine strength: about $163 million of cash against roughly $11 million of gross debt, so net cash near $152 million, with interest coverage above 40x. The fragility in this business is not leverage, it is the fixed-price contract base and the working capital and bonding it ties up.
Bull Case
MYR Group's advantage is not a patent or a brand, it is the structural position of a contractor large enough to bond and execute the biggest electrical jobs in North America while most of the field cannot. The filing lays out the two-segment shape directly: the T&D segment delivers a broad range of services on electric transmission and distribution networks and substation facilities, while the C&I segment handles commercial and industrial electrical construction (FY2025 10-K, accession 0000700923-26-000007). That breadth lets the company chase the work that is actually growing, and the return data backs the position, with trailing return on invested capital near 27% against a cost of capital under 11%. A contractor earning that far above its capital cost has a real edge, not just a busy order book.
The demand backdrop is the strongest part of the case. The most recent quarter was a record, with revenue of roughly $1.0 billion and net income of $46.8 million, and backlog reached a record $2.84 billion, up about 8% year over year, split between $980.7 million in T&D and $1.86 billion in C&I. Management pointed to data-center and water-infrastructure work as the fastest-growing end markets, with data-center construction starts up nearly 100% year over year. Backlog of that size against a single quarter near $1 billion is more than two years of visible work, which is what turns a cyclical contractor into a compounder.
The balance sheet lets the company press that advantage without strain. It ended the quarter with $163.2 million in cash and about $460 million of availability on its revolver, generated $68.6 million of free cash flow, and carries net cash of roughly $152 million. The capacity to bond large projects is itself a moat input, because the filing shows the scale of surety required, with about $491.5 million of bonds outstanding in T&D and $1.85 billion in C&I as of year-end (FY2025 10-K, accession 0000700923-26-000007). A weaker contractor cannot post that backing; MYR can, and it converts directly into eligibility for the largest awards.
Bear Case
The capital structure looks bulletproof on the surface, net cash and 40x interest coverage, but the fragility in this business hides inside the contract mix rather than the debt line, and a fixed-price contractor's stress test is the job that goes wrong. About 57% of the work is fixed price, with another 22% unit price, so roughly four-fifths of revenue carries cost-overrun risk that lands on MYR, not the customer. The most recent quarter's margin gain was helped by favorable change orders and a favorable job closeout, the kind of items that reverse, and management itself noted offsetting project inefficiency costs. One large fixed-price job that runs over can swallow a quarter of segment profit, and the price assumes a decade of clean compounding.
The bonding that enables the big awards is also a concentrated liability. The filing shows roughly $491.5 million of bonds outstanding in T&D and about $1.85 billion in C&I against projects still to complete (FY2025 10-K, accession 0000700923-26-000007). Bonding capacity is finite and tied to balance-sheet strength and loss history, so a string of poor project outcomes does not just dent earnings, it can shrink the company's ability to bid the very work the growth case depends on. That is a feedback loop the net-cash position masks rather than removes.
The valuation leaves no margin for any of this to go wrong. At about 38x operating income, the price requires the self-funding-ceiling growth rate to persist for roughly 10 years, and history says only about 12% of comparable fast-growers sustained that pace for that long. The asset, earnings-power, and peer-multiple methods all sit below the price; the entire premium rests on the single growth-DCF frame. If data-center construction starts cool from their near-doubling pace, or if a few jobs close out poorly instead of favorably, the durability assumption the price is paying for weakens, and there is no cheaper method underneath to catch the fall.
Valuation
At the current price the market is paying about 38x company-wide operating income, which implies operating growth held at its self-funding ceiling for roughly 10 years. That solve runs at a cost of capital near 10.9%, with growth searched up to a 27.2% ceiling, and each additional point of growth moves the implied horizon by about 1.7 years. Keep those figures approximate; they are a single inversion under fixed fade assumptions, not measured forecasts.
The pattern across methods is the clearest signal. The asset-based methods, the earnings-power methods, and the peer-multiple methods all say the stock is richly valued, and only the forward growth-DCF reaches the price. When three of four families land below the quote and one stretches to meet it, the price is a bet on durable compounding that the static frames structurally cannot capture, a moat-and-durability premium. The reverse-DCF range on a whole-company basis centers well below the current price, with an acceptable reliability flag, so the gap between the methods and the quote is real, not an artifact of thin data.
The grounding on the bull side is rarity: the near-term growth pace is within what MYR has recently delivered, so the stretch is in how LONG it must persist, not in the rate. Historically only about 12% of comparable fast-growers sustained this level for nearly a decade. The balance sheet supports the attempt, net cash of roughly $152 million and interest coverage above 40x give the company room to keep bidding through a soft patch, but balance-sheet strength does not lower the bar the price has set on duration.
Catalysts
The most recent quarter, reported in late April 2026, was the key event and it was a record: revenue of about $1.0 billion, net income of $46.8 million (roughly double the prior year), diluted EPS of $2.99, and EBITDA of $81.5 million. Gross margin improved to 13.4% from 11.6% a year earlier, helped by higher-contract-margin work, better productivity, and favorable change orders and closeouts. Backlog hit a record $2.84 billion, up 7.7% year over year, split $980.7 million in T&D and $1.86 billion in C&I.
Forward, management raised full-year operating-margin guidance across both segments and forecast about 12% total revenue growth, and pointed to data-center and water and wastewater projects as the strongest demand drivers, with data-center construction starts up nearly 100% year over year. The company also flagged the Valley Electric transaction in its updates, an acquisition-led extension of capacity. The next quarterly print is the main catalyst: it tests whether backlog keeps building and whether the higher margin holds rather than reverting toward the trailing 5% operating level.
The watch items are project execution and end-market cyclicality. Favorable closeouts can become unfavorable ones, and the data-center surge that is lifting backlog could slow. A continued rise in backlog with stable or improving margins would support the durability the price assumes; a margin give-back or a backlog stall would expose the fixed-price contract risk directly. Sources: MYR Group Q1 2026 results and earnings coverage (stocktitan.net; fool.com; simplywall.st), April 2026.
Peer Cohorts (Per Segment, With Filing Citations)
Transmission & Distribution (T&D) (reported)
- PWR (Quanta Services, Inc.)
- FY2025 10-K: …and energy delivery companies, as well as governmental entities. We have estimated revenues by customer type as a percentage of total revenues below. Such estimates 8 are based on management judgment and assumptions and are provided to show perceived trends in our customer types and should be considered directional…
- FY2025 10-K: …and repair services related to commercial and industrial wiring; and • aviation services primarily for the utility industry, including transportation of line workers, pole and tower setting, and wire stringing, as well as certain emergency aerial firefighting services. This segment also includes (i) the majority of…
- MTZ (MasTec, Inc.)
- FY2025 10-K: …and distribution system expansion, reliability, resiliency, grid hardening and modernization resulting from rising electricity demand, growth in renewable generation, and aging grid infrastructure. • Our Pipeline Infrastructure segment is expected to benefit from continued investment in natural gas distribution and…
- FY2025 10-K: …infrastructure, and we expect to benefit from market trends in these industries. Opportunities in our Power Delivery Segment The U.S. electrical transmission and distribution infrastructure, referred to as "the grid," is composed of a network of electric generating facilities, high voltage transmission lines,…
- PRIM (Primoris Services Corporation)
- FY2025 10-K: …the methods used by the segment to provide the services, and the regulatory environment of each segment's customers. The classification of certain operating expenses and SG&A expenses for segment reporting purposes can at times require judgment on the part of management. Our segments may perform services across…
- FY2025 10-K: …segment. ● Power Delivery, inspection, maintenance, and replacement of electrical utility infrastructure - We are experiencing strong tailwinds in our power delivery business due to increased demand for electricity in the United States. Electric utilities continue to invest in grid resiliency, modernization,…
- IESC (IES Holdings, Inc.)
- FY2025 10-K: …and end markets, including data centers for co-location and managed hosting customers; corporate, educational, financial, hospitality and healthcare buildings; e-commerce distribution centers; and high-tech manufacturing facilities. We also provide the design and installation of audio/visual, telephone, fire,…
- FY2025 10-K: …constant presence. We also provide mechanical services such as maintenance agreements, installation, or replacement of mechanical equipment for commercial and industrial facilities. This segment provides services for a variety of project types, including data centers, manufacturing facilities, office buildings, wind…
- STRL (Sterling Infrastructure, Inc.)
- FY2025 10-K: …Solutions, Transportation Solutions and Building Solutions. The segment information for the prior periods presented has been recast to conform to the current presentation. The Company's CODM, which is the Company's Chief Executive Officer, uses both segment gross profit and operating income for each segment…
- FY2025 10-K: …and Results of Operations" is provided to assist readers in understanding our financial performance during the periods presented and significant trends that may impact our future performance. This discussion should be read in conjunction with our Consolidated Financial Statements and the related notes thereto.…
Commercial & Industrial (C&I) (reported)
- IESC (IES Holdings, Inc.)
- FY2025 10-K: …constant presence. We also provide mechanical services such as maintenance agreements, installation, or replacement of mechanical equipment for commercial and industrial facilities. This segment provides services for a variety of project types, including data centers, manufacturing facilities, office buildings, wind…
- FY2025 10-K: …quality, timeliness and price. We believe that we have a competitive advantage due to our breadth of capabilities, focus on quality, technical support, customer service, and financial resources. Seasonality and Quarterly Fluctuations Infrastructure Solutions' revenues from its custom-engineered bus systems and…
- EME (EMCOR Group, Inc.)
- FY2025 10-K: …customers through approximately 100 operating subsidiaries, which specialize principally in providing construction services relating to electrical and mechanical systems in all types of facilities and in providing various services relating to the operation, maintenance, and management of those facilities. Such…
- FY2025 10-K: …are engaged in this field. Within our mechanical services division, we compete with entities such as APi Group Corporation, Comfort Systems USA, Inc., and Service Logic LLC, as well as Carrier Global Corporation and Trane Technologies plc. Within our commercial and government site-based divisions, competition…
- MTZ (MasTec, Inc.)
- FY2025 10-K: …as well as pipeline integrity, including the repair of pipeline infrastructure and facilitating their safe use throughout their lifecycle, and other services for the energy and utilities industries. The Other segment includes certain equity investees, the services of which may vary from those provided by the…
- FY2025 10-K: …governmental policies that reduce tax or funding incentives and changes in governmental processes that delay or reduce investments in projects, as well as changes in climate and environmental policies that contribute to demand for clean energy infrastructure. See Item 1A. "Risk Factors" under " Changes to laws,…
- PRIM (Primoris Services Corporation)
- FY2025 10-K: …based on units completed. Costs to obtain contracts are generally not significant and are expensed in the period incurred. The classification of revenue, gross profit, and operating income for segment reporting purposes can at times require judgment on the part of management. Our segments may perform services…
- FY2025 10-K: …the methods used by the segment to provide the services, and the regulatory environment of each segment's customers. The classification of certain operating expenses and SG&A expenses for segment reporting purposes can at times require judgment on the part of management. Our segments may perform services across…
- STRL (Sterling Infrastructure, Inc.)
- FY2025 10-K: 's revenue in 2025, 47% in 2024 and 50% in 2023. 5 Building Solutions -Our Building Solutions segment is comprised of our residential and commercial businesses. The principal geographic market for our residential business is Texas, specifically Dallas-Fort Worth, Houston and the surrounding communities. In 2021, we…
- FY2025 10-K: …projects for highways, roads, bridges, airports, ports, rail and storm drainage systems. Building Solutions includes residential and commercial concrete foundations for single-family and multi-family homes, parking structures, elevated slabs, other concrete work, plumbing services, and surveys for new single-family…
- FIX (COMFORT SYSTEMS USA, INC.)
- FY2025 10-K: …was established in 1997. We provide mechanical and electrical contracting services. Our mechanical segment principally includes heating, ventilation and air conditioning ("HVAC"), plumbing, piping and controls, as well as off-site construction, monitoring and fire protection. Our electrical segment includes…
- FY2025 10-K: …our 2025 revenue. Construction, Installation, Expansion and Renovation Services -Construction, installation, expansion and renovation services consist of "design and build" and "plan and spec" projects. In "design and build" projects, the commercial MEP company is responsible for designing, engineering and installing…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Economic-unit decomposition (SOTP): each disclosed business unit is assigned its native valuation basis before any multiple is applied. Operating units are valued on enterprise value; funded financial units are valued on their own common equity, because their borrowings fund earning assets rather than levering the parent. A company total is stated only once every material unit carries a supported value and the parent capital bridge reconciles.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.