Everus Construction Group Inc

Everus Construction Group, Inc. (ECG) was another top contributor. The company provides electrical and mechanical contracting services, as well as power transmission and distribution construction. The stock rose following the company’s reporting of fourth-quarter and full-year 2025 results, which included a record year-end backlog and profit and revenue growth that exceeded consensus expectations. Management highlighted strong demand and bidding activity across data centers, high-tech, hospitality and utility markets. Looking ahead, we believe demand for the services Everus provides will remain strong, particularly as data centers require increasing energy capacity to support the expansion of AI.

Everus Construction Group, Inc. (ECG) was another large contributor. The company provides electrical and mechanical contracting services and power transmission and distribution construction services. Fundamentals for the business remain encouraging, and Everus continues to benefit from strong demand across its data center, high-tech, hospitality and utility markets. Regarding Everus, we think current AI demands have already strained the electrical grid in a way that will require upgrades for the next 10 to 20 years, regardless of AI capital expenditures over the next year. Everus stands to benefit from those upgrades.

Everus Construction Group (ECG) primarily builds power lines, pipelines, and similar infrastructure across the U.S. Its revenue backlog grew 38% in 2024, nearly equal to 2024 revenue, indicating strong demand. The company has been a steady grower for the past five years, and in a stable environment, it is worth in the $60s or $70s. The recent sell-off is attributed to its small market cap and the market's uncertainty in valuing it. However, the inefficiency presents an attractive opportunity, especially as it can pass on increased costs to customers.