We look for Southland to continue its momentum on executing high-margin, short duration projects in 3Q:25. We forecast SLND will likely report a modest sequential backlog decline to $2.2 billion at quarter-end 3Q:25, and that this would be viewed as a positive indicator of SLND maintaining disciplined bidding as it winds down legacy issues. Texas voters approved Proposition 4 last week, allotting up to $20 billion for water infrastructure projects. We think this allows SLND a greater supply of projects to bid on in one of its core markets (Texas) and competencies (water infrastructure). We think SLND's stock will better reflect the company's opportunity set to bid and win infrastructure projects as it demonstrates line of sight toward concluding legacy projects and settling claim disputes. Steps SLND has taken to bolster its balance sheet, ongoing legacy challenges, and earnings risk from claim settlements are considered in our high risk rating. Our $6 price target continues to be based on 15x our 2027 EPS estimate of $0.39.