Comfort Systems (FIX 2.06%) is a leading provider of mechanical, electrical, and plumbing (MEP) contracting services.
Think that's a boring business? Comfort Systems' stock says otherwise, having rallied a whopping 242% in just one year and nearly 1,000% in just three years, as of this writing. That means if you'd invested in the little-known stock three years ago, your money would have grown tenfold already.
Remarkably, Comfort Systems' growth catalysts look stronger than ever. Its backlog hit a record high of $9.4 billion last quarter, and the company has consistently beaten consensus earnings estimates for 14 consecutive quarters.
This rapidly growing company is set to announce fourth-quarter and full-year 2025 results after market close on Feb. 19; is Comfort Systems stock a buy ahead of earnings?
Image source: Getty Images.
Why is Comfort Systems stock surging?
Comfort Systems had a blowout last quarter, doubling its earnings per share (EPS) to $8.25 on 35% year-over-year revenue growth.
Backlog jumped 65% year over year to an all-time high of $9.4 billion, driven by unprecedented demand, especially from the technology sector.
Now, this is where things get interesting. Comfort Systems equips all kinds of buildings with HVAC (heating, ventilation, and air conditioning), electrical, and plumbing systems. With hyperscalers spending billions of dollars on artificial intelligence (AI), data centers have emerged as the biggest growth opportunity for Comfort Systems.
Data centers supporting AI workloads consume massive, uninterrupted, 24/7 power supplies to sustain both server operations and high-performance cooling systems to prevent meltdown.
Comfort Systems is an expert in it all, and demand is so high that technology (data centers, semiconductor facilities) accounted for 42% of the company's revenue during the first nine months of 2025 compared with only 32% in the year-ago period. Comfort Systems is also snapping up smaller mom-and-pop mechanical and electrical operators to expand its footprint, with a focus on the high-growth data center market.
Modular is also a significant competitive advantage, with the segment accounting for 17% of Comfort Systems' revenue in the first nine months of 2025. Modular components are built off-site in factories under controlled conditions and are therefore much cheaper and faster to deploy at data center sites. Comfort Systems is also expanding its modular capacity to keep pace with demand.
NYSE: FIX
Key Data Points
The torrid growth has sent Comfort Systems shares soaring by more than 200% over the past year.
Is Comfort Systems stock a good buy before earnings?
Comfort Systems entered the fourth quarter with $3.7 billion more in backlog versus last year, positioning the company for yet another record-breaking performance this week. Expectations are running high, with a consensus EPS of $6.75 for Q4, representing a robust 65% surge over the previous year.
Comfort Systems stock, however, is no longer cheap. It trades at a trailing price-to-earnings ratio of 58.
Long-term, Comfort Systems is a compelling buy. Management is also rewarding shareholders through active buybacks and dividend raises, including a 20% hike announced last quarter. Given the premium valuation, though, I'd wait for any pullback to buy shares of this offbeat AI play.
