Key Takeaways:
Primoris Services Corp. lost more than $7.8 billion in market value after two disclosure events revealed cost overruns across six renewable energy projects, triggering securities fraud investigations by at least two law firms.
"The results validate our strategy," CEO Koti Vadlamudi said during the May 6 earnings call, citing project redesigns, labor issues, sequencing errors and weather disruptions as factors behind the margin collapse.
The Dallas-based infrastructure company's stock fell $101.69, or 50.11%, to close at $101.23 on May 6 after reporting first-quarter results that missed analyst estimates. Primoris slashed its full-year adjusted EBITDA guidance to $480 million to $500 million from a prior range of $560 million to $580 million, citing lower renewable energy activity and delayed project starts.
On June 22, the company disclosed additional challenges, including the abrupt departure of its chief operating officer and cost overruns tied to six projects. Shares fell another $23.39, or 21.6%, to $84.95. The following day, intraday trading saw the stock plunge as much as $43.34, or 40%, before recovering.
Primoris's renewables business, which historically contributed roughly 40% of total annual revenue, now faces a projected 30% decline to $2.1 billion to $3 billion for 2026, down from $3 billion in 2025. The company's Energy segment posted a $152.9 million, or 13.8%, year-over-year revenue decline in the first quarter, with gross profits falling nearly 40%.
Glancy Prongay Wolke & Rotter and Hagens Berman have opened investigations into whether Primoris's pre-May 5 statements about its renewables business misled investors. The probes focus on when management learned the full scope of the project problems and whether earlier explanations — including February comments attributing higher costs to "difficult soil and rock conditions" at a single project — adequately disclosed the risks.
The investigations center on six projects where Primoris identified "additional challenges and cost overruns" as work progressed. The company has not disclosed whether it faces potential debt covenant violations or further write-downs.
The stock now trades at its lowest level since 2023, testing support near $85. Investors will watch for any restatement of prior financial results or further project disclosures in the coming weeks.
