$LMB: Limbach missed the data center boom. Is that the opportunity? | 1 Main Capital

Watch on YouTube ↗ | September 01, 2026 at 13:18 | 50:54 | Yet Another Value Podcast

Speakers

Yaron Naymark — Investor, 1 Main Capital

Andrew Walker — Host, Yet Another Value Blog

Summary

Yaron Naymark returns to discuss Limbach (LMB), an HVAC/MEP contractor he first pitched in 2023. He argues the recent EBITDA collapse and 50% drawdown reflect a temporary demand air pocket and fixed-cost deleverage rather than a broken business, and he is buying again because of valuation support, M&A optionality, and a new effort to enter data-center work via a program-management acquisition. The conversation also covers how he invests around AI through IWG and KKR, plus mega alternative asset managers as AI winners.

Limbach shares fell about 50% after organic revenue declined and EBITDA dropped 30% on fixed-cost deleverage and a guidance cut from $90m to $80m.
Yaron Naymark sees the decline as temporary, with core healthcare demand normalizing, good bookings, a clean balance sheet, and downside valuation support.
He views Limbach's capital allocation as a value driver: acquisitions at 5-6x EBITDA in a fragmented MEP market and a possible re-rating.
The data-center program-management acquisition is Limbach's first real push into data centers, with potential pull-through work that could materially increase data-center exposure.
Yaron owns IWG as an underappreciated AI beneficiary because flexible office demand may rise as AI changes headcount and lease needs.
He reinitiated KKR and favors mega alternative asset managers as AI winners due to consolidation, proprietary data, and share gains from passive.
The discussion includes risks: low-margin backlog, wage inflation, guidance credibility, and de-SPAC history.

Ideas

Yaron Naymark Investor, 1 Main Capital 3:12

Cheap HVAC owner-direct with data-center optionality

Limbach is an HVAC/MEP contractor that transitioned from general contracting to owner-direct services, but it hit a temporary demand air pocket in the first half from tariffs, healthcare funding cuts, and macro uncertainty. Organic revenue fell mid-single digits and EBITDA fell about 30% due to fixed-cost deleverage, prompting guidance cut from $90m to $80m and a roughly 50% stock decline. Naymark argues the decline is not a broken business: bookings have been good but burned slowly, core healthcare is normalizing, the balance sheet is clean, and even a $65m EBITDA scenario implies about $4/share of free cash flow and valuation support at roughly 10x. He sees a triple upside: multiple expansion on the base business, value creation from M&A in a fragmented MEP market at 5-6x EBITDA, and optionality from finally entering data centers via a program-management acquisition that could pull through hundreds of millions of data-center revenue and add operating leverage. Management alignment is strong, with the CEO never selling shares, and if execution remains weak, strategic or private buyers could acquire the company.

Yaron Naymark Investor, 1 Main Capital 44:49

Flexible offices benefit from AI headcount shifts

Naymark owns IWG and thinks the market misclassifies it as an AI loser because office jobs could shrink. He argues AI-driven productivity may flatten or reduce corporate headcount, making long-term leases less attractive and increasing demand for flexible short-term office space. Flexible space is still only a low-single-digit percentage of office utilization today, leaving a large runway if that mix rises, and IWG is not valued as an AI beneficiary.

Yaron Naymark Investor, 1 Main Capital 45:42

KKR: mega-alt AI winner after private-credit fear

Naymark reinitiated KKR this year after the private-credit scare created an attractive entry. He views KKR as a mega alternative asset manager that will be an AI winner over time because it has a long track record and blue-chip franchise, can survive bad vintages, and should take share as mid-market private-equity firms consolidate. Specifically, KKR has the largest Asia alternatives business, a large European business, underpenetrated US credit, infrastructure, and real-estate strategies to grow, and exposure to the fast-growing high-net-worth retail alternatives channel.

Yaron Naymark Investor, 1 Main Capital 47:03

Mega alts are long-term AI winners

Naymark believes mega alternative asset managers are long-term AI winners. In an AI-driven economy, owning passive indexes becomes harder because they hold AI losers, while active managers can select winners; mega alts also have proprietary data from decades of deals, long track records and blue-chip franchises that let them survive bad vintages, and should gain share as mid-market firms consolidate. They also benefit from alternatives being underpenetrated in Asia and Europe versus the US and from growth in the high-net-worth retail channel.

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This Yet Another Value Podcast video, published September 01, 2026, features Yaron Naymark discussing LMB, IWG.L, KKR, Mega alternative asset managers. 4 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Yaron Naymark · Tickers: LMB, IWG.L, KKR, Mega alternative asset managers