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Legence Corp. Class A
(NASDAQ:LGN)
Select Model
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Rating:57Neutral
Price Target:
$37.00
▼(-31.28% Downside)
Action:Reiterated
Date:10/17/26
The score is driven primarily by improving cash flow and strong growth/backlog with raised guidance from the latest earnings call. These positives are tempered by leverage/profitability volatility in the financials and a clearly bearish technical setup (below key moving averages with negative MACD), while valuation support is limited by losses and no stated dividend yield.
Positive Factors
Revenue and Backlog Growth
Exceptional revenue growth and a record backlog indicate strong demand for Legence’s services and improve forward workload visibility. Sustained bookings above revenue support continued expansion over the next several quarters, while scale can strengthen customer reach and execution capacity.
Negative Factors
Debt-Heavy Balance Sheet
The sizable debt balance relative to reported equity leaves Legence with less financial flexibility if project execution or demand weakens. Negative returns on equity and inconsistent historical equity reporting also make leverage trends harder to assess and may constrain capital allocation.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue and Backlog Growth
Exceptional revenue growth and a record backlog indicate strong demand for Legence’s services and improve forward workload visibility. Sustained bookings above revenue support continued expansion over the next several quarters, while scale can strengthen customer reach and execution capacity.
Read all positive factors
Legence Corp. Class A (LGN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.90B
Dividend YieldN/A
Average Volume (3M)1.20M
Price to Earnings (P/E)―
Beta (1Y)2.15
Revenue Growth69.19%
EPS Growth7.75%
CountryUS
Employees7,000
SectorGeneral
Sector StrengthN/A
IndustryEngineering & Construction
Share Statistics
EPS (TTM)-0.66
Shares Outstanding76,904,340
10 Day Avg. Volume1,537,057
30 Day Avg. Volume1,196,712
Financial Highlights & Ratios
PEG Ratio0.04
Price to Book (P/B)6.52
Price to Sales (P/S)1.00
P/FCF Ratio11.67
Enterprise Value/Market Cap1.99
Enterprise Value/Revenue2.07
Enterprise Value/Gross Profit12.38
Enterprise Value/Ebitda39.13
Forecast
1Y Price Target
$100.42Price Target Upside86.51% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering12
EPS Forecast (FY)1.33
Revenue Forecast (FY)$4.78B
Legence Corp. Class A Business Overview & Revenue Model
Company Description
Legence Corp., a company established in 1914 and based in San Jose, California, specializes in providing engineering, installation, and maintenance services for essential building systems throughout the United States. Its operations are structured...
Legence Corp. Class A Earnings Call Summary
Earnings Call Date:Aug 13, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 13, 2026
Earnings Call Sentiment Positive
The call conveyed a strongly positive operational and financial performance: record revenue and backlog, sizable organic growth, expanded fabrication capacity and workforce, materially reduced leverage and upgraded guidance. Notable headwinds include a decline in adjusted gross margins due to mix shifts, impairment in the sustainability consulting business, higher D&A and tax items tied to legacy profit interests, and increased concentration in data center & technology which introduces booking volatility and concentration risk. On balance, the positive operational momentum, guidance increases, balance sheet improvements and capacity investments outweigh the listed challenges.Positive Updates
Record Revenue and Strong Organic Growth
Total revenue of $1.262 billion in Q2 2026, up 111% year-over-year; excluding the Bowers acquisition, organic revenue growth was nearly 60% year-over-year.
Negative Updates
Adjusted Gross Margin Decline
Adjusted consolidated gross margin declined to 18.5% in Q2 2026 from 21.8% in Q2 2025 (down ~330 basis points YoY), driven by revenue mix shift toward Installation & Maintenance and lower margin in Engineering & Consulting.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Revenue and Strong Organic Growth
Total revenue of $1.262 billion in Q2 2026, up 111% year-over-year; excluding the Bowers acquisition, organic revenue growth was nearly 60% year-over-year.
Read all positive updates
Company Guidance
Legence raised its outlook, guiding Q3 2026 consolidated revenue of $1.225–$1.275 billion and adjusted EBITDA of $150–$160 million, and bumping full‑year 2026 revenue to $4.7–$4.8 billion (midpoint ~13% above the prior $4.1–$4.3B range) and full‑year adjusted EBITDA to $565–$585 million (roughly 20% above the prior $470–$490M range); additional modeling items include interest expense (net) of about $15 million per quarter in H2, Q3 depreciation & amortization near Q2’s $44 million, H2 capital spending of $40–$45 million (within ~2% of expected revenue), an estimated 2026 cash tax bill in the mid‑$50 million range plus TRA payments of ~$8–$9M (for 2025, payable early 2027) and $25M–low‑$30M (for 2026, payable early 2028). These guidance moves are supported by a record $5.7 billion backlog (up 105% YoY), a Q2 book‑to‑bill of 1.2x (last 12‑month 1.4x), pro forma net leverage of ~1.5x with ~$292M cash and $461M total liquidity at quarter end, ~11,000 employees (≈8,000 skilled technicians), and 1.5 million sq. ft. of fabrication capacity (with ~100k sq. ft. adding shortly).Legence Corp. Class A Financial Statement Overview
Summary
Income Statement
56
Neutral
Balance Sheet
38
Negative
Cash Flow
79
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 |
|---|---|---|---|---|
Income Statement | ||||
| Total Revenue | 3.75B | 2.55B | 2.10B | 1.62B |
| Gross Profit | 627.13M | 535.92M | 428.64M | 315.15M |
| EBITDA | 198.33M | 160.92M | 156.62M | 107.05M |
| Net Income | -45.04M | -59.78M | 9.72M | -46.03M |
Balance Sheet | ||||
| Total Assets | 3.74B | 2.68B | 2.35B | 2.13B |
| Cash, Cash Equivalents and Short-Term Investments | 291.98M | 230.17M | 81.17M | 88.92M |
| Total Debt | 1.20B | 954.15M | 1.70B | 1.12B |
| Total Liabilities | 2.76B | 1.89B | 2.15B | 1.60B |
| Stockholders Equity | 600.46M | 392.20M | 202.68M | 522.93M |
Cash Flow | ||||
| Free Cash Flow | 323.18M | 218.93M | 10.26M | 16.84M |
| Operating Cash Flow | 388.82M | 256.87M | 29.27M | 33.92M |
| Investing Cash Flow | -362.54M | -54.05M | -243.99M | -133.90M |
| Financing Cash Flow | 167.79M | -53.83M | 206.96M | 128.47M |
Legence Corp. Class A Technical Analysis
Negative
53.84
Price Trends
52.99
Negative
63.71
Negative
63.55
Negative
Market Momentum
-4.39
Positive
21.61
Positive
7.09
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LGN, the sentiment is Negative. The current price of 53.84 is above the 20-day moving average (MA) of 48.14, above the 50-day MA of 52.99, and below the 200-day MA of 63.55, indicating a bearish trend. The MACD of -4.39 indicates Positive momentum. The RSI at 21.61 is Positive, neither overbought nor oversold. The STOCH value of 7.09 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LGN.
Legence Corp. Class A Risk Analysis
Legence Corp. Class A disclosed 78 risk factors in its most recent earnings report. Legence Corp. Class A reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Legence Corp. Class A Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $1.10B | 16.40 | 20.92% | ― | 18.09% | 78.28% | |
69 Neutral | $472.69M | 55.31 | 3.58% | 1.39% | 6.91% | 4.11% | |
57 Neutral | $3.90B | -55.01 | -9.55% | ― | 69.19% | 7.75% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
54 Neutral | $983.32M | 34.96 | 2.49% | ― | 8.89% | -54.65% | |
50 Neutral | $352.71M | 92.66 | 2.22% | ― | 7.05% | -67.59% | |
46 Neutral | $40.28M | -0.10 | 331.10% | ― | -32.66% | -397.97% |
* General Sector Average
LGN
Legence Corp. Class A
36.07
-0.75
-2.04%
AMRC
Ameresco
18.53
-23.02
-55.40%
ORN
Orion Group Holdings
8.71
0.00
0.00%
WLDN
Willdan Group
72.48
-23.74
-24.67%
BBCP
Concrete Pumping Holdings
9.38
3.08
48.77%
SLND
Southland Holdings
0.74
-3.82
-83.77%
Legence Corp. Class A Corporate Events
Business Operations and StrategyExecutive/Board Changes
Legence Corp. Appoints Independent Finance Veteran to Board
Positive
Aug 18, 2026
On August 18, 2026, Legence Corp. expanded its Board of Directors from six to seven members and appointed veteran finance executive Robert Crisci as a Class II director, with his initial term running until the 2027 annual shareholders’ meeti...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.