A major league growth story, but at the cost of not letting the company make a bigger mistake

At first glance, it looks appealing: a multi-billion dollar infrastructure connected to megatrends such as energy transformation, transmission grid modernization, data centers and 5G, decent revenue growth and a backlog that management is not afraid to push further. But a closer look shows a company that earns a net margin of around 2-3% on these revenues, carries execution risk, and trades at a P/E of over 100, EV/EBITDA of over 30 times, and around 10 times book value - all in an industry where most competitors are worth much lower multiples.

According to the latest numbers, this Altman player has a Z-score of around 5 (i.e. balance sheet not a problem), ROE of around 10%, revenues of over $12 billion and a backlog that management promotes with great confidence. The problem isn't growth, it's the quality of the margins and how much an investor is willing to pay for the "story" - especially when compared to nearby names like Quanta Services, Dycom or Primoris, which often have better…