With a 60% Profit, We're Selling Emcor Group Inc. (EME)

It's our third windfall ...

Author

Stock Picker's Corner (SPC)
August 04, 2025

In this Monday Morning Kickoff, we’re cashing out a winner from our Special-Situation Portfolio: Emcor Group Inc. $EME ( ▲ 0.81% ) .

We last updated you on Emcor — a leader in energy infrastructure and electrical construction — on July 14.

Here’s a quick recap:

Emcor is riding a wave of demand for hyperscale data centers, which are critical to powering AI workloads. As AI adoption accelerates, so does the need for the massive computing infrastructure Emcor helps build. The company also leverages AI internally to optimize energy use, monitor equipment health, and automate facility operations.

On June 13, UBS Securities issued a “Buy” rating on EME with a $570 price target, citing strong earnings potential driven by data centers, semiconductor facilities, and pharmaceutical plants.

We originally added Emcor to the Special Situation Portfolio not just as an “AI Energy Play,” but also because of its $500 million share buyback program. Buybacks reduce the number of shares out there in the market, and when you reduce the supply of something and demand holds steady, the price will climb. With stocks, one of the big “yardsticks” is earnings per share (EPS). When you apportion profits over a smaller number of shares, the EPS goes up even if the business holds steady. If you reduce shares while earnings are surging, there’s a magnifier effect. It’s a classic shareholder-friendly move.

For us, it paid off.

Since we added Emcor on September 11, shares have surged 62%. That translates to:

✅ A 60% gain in under 11 months — an annualized return of nearly 70%.


✅ Nearly 6x the historical average annual return of the S&P 500 of 10% in less than year.


✅ And $10,000 investment would now be worth $16,000 — a $6,000 gain in less than a year.

While we still like Emcor’s long-term prospects, we created the Special- Situation Portfolio to deliver intermediate-term windfalls like this for capturing major, market-beating gains from catalysts like buybacks, dividend hikes, breakups, and more.

A 60% gain in such a short stretch is great by itself. But in the face of rising uncertainty swirling around stocks and the economy, we’re exercising prudence and locking in the profit. We’re officially removing Emcor from the portfolio and will no longer provide active coverage.

If you’re holding shares and want to stay invested, consider using an “Accumulate” strategy (buying on pullbacks) or set up an automated plan to invest regularly.

We’re currently looking at some companies to replace Emcor. We’ll be back sometime this month with an update.

And if you followed along and are cashing out of Emcor today, congratulations on your win. It continues a strong streak of winners thus far from the Special-Situation Portfolio, as we sold out of Dutch Bros Inc. $BROS ( ▲ 0.33% ) for a 58% gain and Sprouts Farmers Market Inc. $SFM ( ▼ 1.68% ) for a 49% gain.

Take care,