Primoris Services: A High-Conviction Buy Amid AI-Driven Infrastructure Demand

The AI revolution is reshaping global infrastructure, and few companies are positioned as strategically as Primoris Services (PRIM). With a $1.7 billion data center contract pipeline under evaluation for 2025 and a robust $11.5 billion backlog, the firm is capitalizing on the surging demand for power, fiber, and utility infrastructure driven by artificial intelligence and cloud computing [1]. This momentum, coupled with outperformance against peers and a disciplined financial strategy, makes Primoris a compelling high-conviction buy for investors seeking exposure to the next phase of the tech-driven economy.

Strategic Positioning in the AI Infrastructure Boom

Primoris has positioned itself at the nexus of two critical trends: the exponential growth of AI and the need for mission-critical infrastructure to support it. According to a report by Simply Wall Street, the company is already shortlisted for $400–500 million in data center contracts expected by year-end 2025, with projects spanning site preparation, power generation, and fiber network construction [2]. While data centers currently account for less than 10% of revenue, management anticipates a decade-long opportunity as AI demand drives exponential growth in power and connectivity [3].

This strategic focus aligns with the broader infrastructure landscape. As stated by Bloomberg, Primoris’ expertise in utilities and energy—segments that grew 20.9% year-over-year in Q2 2025—provides a natural bridge to data center work. The company’s backlog of $11.5 billion, up from $9.8 billion in 2024, reflects strong visibility into future revenue, with data center and renewables projects accounting for a growing share [4].

Financial Performance and Operational Execution

Primoris’ financials underscore its ability to execute in a high-growth environment. In Q2 2025, the company reported record revenue of $1.89 billion, a 20.9% increase from the prior year, driven by 27.1% growth in its Energy segment and 11.6% in Utilities [5]. Operating income surged 46.7% year-over-year to $127 million, while net income jumped 70.2% to $84.3 million [6]. These results prompted management to raise 2025 adjusted EPS guidance to $4.90–$5.10, exceeding both its previous forecast and analyst expectations [7].

The company’s balance sheet is equally compelling. Net debt-to-EBITDA has fallen to 0.5x, and operating cash flow reached $78 million in Q2 2025 [8]. This financial discipline allows Primoris to pursue aggressive growth without overleveraging, a stark contrast to peers like Arcosa, Inc., which has a CAGR of 8.1% in revenue compared to Primoris’ 22% from FY21–24 [9].

Outperformance Against Peers

Primoris’ outperformance is not accidental but rooted in its niche expertise and agility. While larger competitors like Quanta Services (PWR) and EMCOR Group (EME) dominate broader markets, Primoris has carved a niche in utility, pipeline, and specialty contracting—areas critical to data center infrastructure [10]. Data from Simply Wall Street indicates that Primoris’ Q2 2025 revenue growth of 20.9% far exceeded the industry average of 6.67%, and its net income growth of 70.19% outpaced the 44.45% average among competitors [11].

The stock has also outperformed, gaining 22.8% since its Q2 earnings report, compared to flat or negative returns for most peers [12]. Analysts have raised 2025 and 2026 EPS estimates to $4.67 and $5.23, respectively, reflecting a 20.7% and 12.1% year-over-year growth trajectory [13]. At a forward P/E of 22.28, slightly above the industry average, the stock appears undervalued relative to its growth prospects [14].

Conclusion: A High-Conviction Buy

Primoris Services is a rare combination of strategic foresight, operational excellence, and financial discipline. Its alignment with the AI-driven infrastructure boom—through data centers, renewables, and utilities—positions it to benefit from multiyear tailwinds. With a $1.7 billion pipeline, a $11.5 billion backlog, and a track record of outperforming peers, the company is not just riding the wave of AI; it is building the infrastructure that will power the next decade of innovation. For investors, this is a high-conviction opportunity to participate in a structural shift, backed by numbers that speak for themselves.

Source:
[1] Surging Data Center Contract Pipeline Could Be a Game Changer [https://simplywall.st/stocks/us/capital-goods/nyse-prim/primoris-services/news/surging-data-center-contract-pipeline-could-be-a-game-change]
[2] This 'Stealth' AI Stock Is an Even Better Buy Than Palantir or Nvidia [https://finance.yahoo.com/news/stealth-ai-stock-even-better-182117789.html]
[3] Primoris Q2 2025 slides: Record revenue and earnings [https://www.investing.com/news/company-news/primoris-q2-2025-slides-record-revenue-and-earnings-drive-70-profit-surge-93CH-4170959]
[4] PRIM Q2 Deep Dive: Data Center Momentum and Utilities [https://finance.yahoo.com/news/prim-q2-deep-dive-data-033649626.html]
[5] Primoris Services Stock Up 22.8% Since Q2 Earnings [https://finance.yahoo.com/news/primoris-services-stock-22-8-165500923.html]
[6] Primoris Services: Solid Growth Visibility With Strong Catalysts [https://seekingalpha.com/article/4811939-primoris-services-stock-solid-growth-visibility-with-strong-growth-catalysts]
[7] Can PRIM Capitalize on $1.7B Data Center Infrastructure Opportunity? [https://www.nasdaq.com/articles/can-prim-capitalize-17b-data-center-infrastructure-opportunity]
[8] Primoris Services Corporation (PRIM) Stock Price [https://www.datainsightsmarket.com/companies/PRIM]
[9] Will Strong Utilities Demand Drive Primoris Services' EPS Higher? [https://www.nasdaq.com/articles/will-strong-utilities-demand-drive-primoris-services-eps-higher]
[10] Sterling vs. Primoris: Which Infrastructure Stock is the Better Buy [https://finviz.com/news/149123/sterling-vs-primoris-which-infrastructure-stock-is-the-better-buy]
[11] A Look at Primoris Services's Valuation as Utilities Growth [https://simplywall.st/stocks/us/capital-goods/nyse-prim/primoris-services/news/a-look-at-primoris-servicess-valuation-as-utilities-growth-a]
[12] Primoris Services Corporation [https://csimarket.com/stocks/compet_glance.php?code=PRIM]
[13] Primoris Services Stock Up 22.8% Since Q2 Earnings [https://finance.yahoo.com/news/primoris-services-stock-22-8-165500923.html]
[14] Primoris surpasses analyst estimates, driving stock surge [https://www.marketscreener.com/news/primoris-surpasses-analyst-estimates-driving-stock-surge-ce7d59d9d98cf32d]