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Legence Corp. Class A
(NASDAQ:LGN)
Select Model
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Rating:62Neutral
Price Target:
$56.00
▲(4.01% Upside)
Action:Reiterated
Date:08/19/26
The score is driven primarily by improving fundamentals and outlook: strong cash flow momentum and sharply raised guidance supported by record backlog. Offsetting this are elevated financial risk signals (debt-heavy balance sheet and recent net loss) and mixed technicals with negative MACD and the stock below key intermediate moving averages.
Positive Factors
Raised outlook and record backlog
Higher revenue and EBITDA guidance, combined with a record backlog and positive book-to-bill, indicates strong demand visibility. This supports sustained growth over the next several quarters and gives Legence a foundation for converting contracted work into future revenue and earnings.
Negative Factors
Debt-heavy reported balance sheet
Despite recent leverage improvement, the reported balance sheet remains debt-heavy relative to stated equity, while losses weaken returns on capital. Debt obligations can constrain financial flexibility and make consistent profitability important for sustaining investment and reducing leverage.
Read all positive and negative factors
Positive Factors
Negative Factors
Raised outlook and record backlog
Higher revenue and EBITDA guidance, combined with a record backlog and positive book-to-bill, indicates strong demand visibility. This supports sustained growth over the next several quarters and gives Legence a foundation for converting contracted work into future revenue and earnings.
Read all positive factors
Legence Corp. Class A (LGN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.72B
Dividend YieldN/A
Average Volume (3M)1.16M
Price to Earnings (P/E)―
Beta (1Y)2.05
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. Volume787,167
30 Day Avg. Volume1,155,245
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 Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$106.00Price Target Upside96.88% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
EPS Forecast (FY)1.24
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 | 192.88M | 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
Neutral
53.84
Price Trends
Market Momentum
1.95
Negative
56.57
Neutral
80.20
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LGN, the sentiment is Neutral. The current price of 53.84 is above the 20-day moving average (MA) of 38.98, equal to the 50-day MA of ―, and equal to the 200-day MA of ―, indicating a neutral trend. The MACD of 1.95 indicates Negative momentum. The RSI at 56.57 is Neutral, neither overbought nor oversold. The STOCH value of 80.20 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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 | $1.31B | 19.41 | 20.92% | ― | 18.09% | 78.28% | |
69 Neutral | $529.13M | 61.55 | 3.58% | 1.24% | 6.91% | 4.11% | |
62 Neutral | $5.72B | -80.78 | -9.55% | ― | 69.19% | 7.75% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
54 Neutral | $1.23B | 43.68 | 2.49% | ― | 8.89% | -54.65% | |
51 Neutral | $375.80M | 98.72 | 2.22% | ― | 7.05% | -67.59% | |
46 Neutral | $35.22M | -0.09 | 331.10% | ― | -32.66% | -397.97% |
* General Sector Average
LGN
Legence Corp. Class A
52.97
22.42
73.39%
AMRC
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23.15
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Orion Group Holdings
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WLDN
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85.78
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-12.16%
BBCP
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10.50
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SLND
Southland Holdings
0.65
-3.65
-84.95%
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...
Executive/Board ChangesShareholder Meetings
Legence Stockholders Back Directors, Pay Plan, ESPP Measures
Positive
Jun 11, 2026
Legence Corp. held its 2026 Annual Meeting of Stockholders on June 11, 2026, with approximately 93% of eligible common shares represented, underscoring strong shareholder engagement in corporate governance matters. Stockholders elected David Coghl...
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.