PRIM Targets $2.5B in Renewables: Will Solar Growth Support Margins?

Primoris Services Corporation PRIM is on pace to deliver nearly $2.5 billion in renewables revenues in 2025, above its earlier outlook of $2.2-$2.3 billion. This upside has been fueled by strong demand in utility-scale solar and EPC work, along with activity in battery storage projects. The company noted that solar remains competitive with other forms of power generation, in many cases even without federal subsidies, providing a durable foundation for growth.

Recent legislative clarity on the phaseout of tax incentives has also given customers greater confidence to plan projects. As a result, Primoris continues to secure new awards, with bookings in the second half of the year expected to remain solid. About $1.4 billion of renewables revenues was already realized in the first half, keeping the company on track toward its full-year target.

Margin performance, however, remains a key investor question. The Energy segment’s gross margin for the second quarter of 2025 was 10.8%, down from 12.6% in the prior year. The decline reflected fewer project closeouts and increased costs on certain renewables projects due to unfavorable weather. However, Primoris anticipates that margins in the Energy segment will pick up in the back half of the year as projects advance.

The $2.5 billion renewables milestone highlights the scale of PRIM’s opportunity in solar and clean energy infrastructure. Sustaining profitability alongside rapid growth will be crucial. Execution discipline and project timing will determine whether top-line expansion in renewables consistently supports margins over the long term.

Competitor Landscape: Solar and Renewables Expansion

Alongside PRIM, Quanta Services Inc. PWR and MasTec, Inc. MTZ remain important peers in the renewables and infrastructure sector.

Quanta Services reported a record $35.8 billion backlog and advanced its capabilities with the $1.35 billion acquisition of Dynamic Systems. The company’s self-perform model and leadership in transmission, distribution and renewable integration strengthen its role in the energy transition. Quanta was also named the top U.S. solar contractor and energy storage provider by Solar Power World, highlighting its scale and influence in markets aligned with PRIM’s growth strategy.

MasTec’s Clean Energy and Infrastructure segment backlog expanded about $1.26 billion in the second quarter of 2025, with revenues up 20% year over year. Growth was supported by utility-scale renewables, infrastructure and behind-the-meter power projects. This expansion underscores the rising competition in clean energy as PRIM pursues its $2.5 billion renewables opportunity.

PRIM’s Price Performance, Valuation & Estimates

Shares of Primoris have gained 58.9% in the past three months compared with the Zacks Building Products - Heavy Construction industry’s growth of 23.6%.

From a valuation standpoint, PRIM trades at a forward 12-month price-to-earnings ratio of 22.98X, up from the industry’s 21.49X.

Primoris’ earnings estimates for 2025 and 2026 have trended upward in the past 30 days by 4.2% to $4.67 per share and 2.3% to $5.23, respectively. The estimated figures for 2025 and 2026 indicate 20.7% and 12.1% year-over-year growth, respectively.

PRIM’s Zacks Rank

Primoris currently sports a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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