Energy and renewable energy projects company Ameresco (NYSE: AMRC) reported revenue ahead of Wall Street’s expectations in Q3 2026, with revenue up 10.3% year on year to $580.3 million. The company expects the full year’s revenue to be around $2.14 billion, close to analysts’ consensus estimates. Its non-GAAP profit of $0.88 per share was 53.6% above analysts’ consensus estimates.

For more on Ameresco, read our free full research report.

“Our third quarter results represented another quarter of strong growth and disciplined execution. We achieved revenue increases across each of our major business lines, expanded margins and continued to build both awarded and contracted backlogs. The $875 million in new projects we were awarded in the third quarter brought Ameresco’s total project backlog to a record $7.2 billion. This also was an excellent quarter for project contract conversion with $737 million converting from awarded into contracted backlog, building visibility as we head into 2027,” CEO George Sakellaris commented.

Revenue growth

Reviewing a company’s long-term revenue performance reveals insights into its quality. Even a poor business can perform well for one or two quarters, but a high-quality one grows for years. Ameresco’s revenue grew at a strong 13.3% compounded annual growth rate over the last five years. Its growth beat the average industrials company and shows its offerings resonate with customers.

Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Ameresco’s annualized revenue growth of 11.3% over the last two years is below its five-year trend, but the results still suggest healthy demand.

This quarter, Ameresco reported year-on-year revenue growth of 10.3%, and its $580.3 million of revenue exceeded Wall Street’s consensus estimates by 1.3%.

Looking ahead, sell-side analysts expect revenue to grow 8.9% over the next 12 months, according to S&P, a slight deceleration versus the last two years. Still, this is a solid growth projection and indicates the market expects its products and services to perform well.

Operating margin

Ameresco’s operating margin was broadly unchanged over the last five years. Its costs have broadly tracked its revenue, leaving its long-term profitability largely unchanged. Its trailing 12-month operating margin was 7.5%.

This quarter, Ameresco generated an operating profit margin of 10.6%, up 2.5 percentage points year on year. Its gross margin expanded more than its operating margin, indicating that leverage on its cost of sales was the primary driver of the recent efficiency improvement.

Earnings per share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share, or EPS, points to the profitability of that growth – for example, a company could inflate its revenue through excessive spending on advertising and promotions.

Ameresco’s EPS declined by 5% annually over the last five years while its revenue grew by 13.3%. However, its operating margin didn’t change during this time, indicating that non-fundamental factors such as interest and taxes affected its ultimate earnings.

A closer look at Ameresco’s earnings helps explain its performance. A five-year view shows Ameresco has diluted its shareholders, growing its share count by 1.6%. This has led to lower per share earnings. Taxes and interest expenses can also affect EPS but don’t tell us as much about a company’s fundamentals.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Ameresco, its two-year annual EPS growth of 6.2% was higher than its five-year trend. Accelerating earnings growth is generally a positive sign.

In Q3, Ameresco reported adjusted EPS of $0.88, up from $0.35 in the same quarter last year. This result came in well above analysts’ consensus estimates, a positive for shareholders. Over the next 12 months, Wall Street expects Ameresco’s full-year EPS to grow 44.4% from $1.14 to $1.65, according to S&P.

Key takeaways from Ameresco’s Q3 results

Ameresco’s earnings results had some clear positives: EPS beat analysts’ consensus estimates, and EBITDA topped Wall Street’s estimates by a wide margin. Shares remained flat at $22.63 immediately after the results.

Ameresco had a solid quarter, but one earnings result doesn’t necessarily make the stock a buy. When making that decision, it’s important to consider its valuation, business quality and latest quarterly results. For more on Ameresco, read the full research report here (it’s free).