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Mastec (MTZ)
NYSE:MTZ
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MasTec
(NYSE:MTZ)74Outperform
Positive Factors
Backlog and Revenue Growth
Backlog was up $500M sequentially with a 1.4x book to bill.
Operational Performance
MasTec is beginning to execute well and gain operational momentum.
Negative Factors
Revenue Guidance
Revenue of $3.25B was 'flat' YOY and a bit shy of $3.45B guidance, mostly on some project start delays, particularly in Clean Energy.
MasTec (MTZ) vs. S&P 500 (SPY)
Market Cap
$9.82B
Dividend YieldN/A
Average Volume (3M)1.21M
Price to Earnings (P/E)60.3
Beta (1Y)1.57
Revenue Growth2.56%
EPS GrowthN/A
CountryUS
Employees34,000
SectorIndustrials
Sector Strength66
IndustryConstruction
Share Statistics
EPS (TTM)2.06
Shares Outstanding79,291,824
10 Day Avg. Volume1,580,882
30 Day Avg. Volume1,208,925
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.82
Price to Cash Flow (P/CF)5.40
P/FCF Ratio6.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$171.09Price Target Upside33.76% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
MasTec Business Overview & Revenue Model
Company DescriptionMasTec, Inc. engages in the provision of infrastructure construction services. It operates through the following segments: Communications; Oil and Gas; Electrical Transmissions; Power Generation and Industrial; and Other. The Communications segment performs engineering, construction, maintenance and customer fulfillment activities related to communications infrastructure, primarily for wireless and wireline/fiber communications, and install-to-the-home customers. The Oil and Gas segment offers services on oil and natural gas pipelines and processing facilities for the energy, and utilities industries. The Electrical Transmission segment deals with the energy and utility industries. The Power Generation and Industrial segment covers energy, utility and other end-markets through the installation and construction of conventional and renewable power facilities. The Other segment comprises of equity investees, other small business units that perform construction, and other services for a variety of international end-markets. The company was founded by Jorge Mas Canosa in 1994 and is headquartered in Coral Gables, FL.
How the Company Makes MoneyMasTec generates revenue through a diversified business model that encompasses multiple sectors within the infrastructure construction industry. The company earns money by providing end-to-end construction services, which include design, engineering, procurement, construction, and maintenance. Key revenue streams include contracts with telecommunications companies for the deployment and maintenance of communication networks, such as 5G infrastructure. Additionally, MasTec serves the energy sector by constructing oil and gas pipelines and facilities, as well as renewable energy projects, including wind and solar installations. The company also benefits from partnerships and long-term contracts with major utilities and energy companies, which provide a steady flow of projects and recurring revenue. MasTec's diverse service offerings across various industries help mitigate risks associated with market fluctuations in any single sector, contributing to its financial stability and growth.
MasTec Financial Statement Overview
Summary
MasTec demonstrates strong financial health with robust revenue growth, improved profitability, and solid cash flow generation. The balance sheet shows reduced leverage and a strong equity position. While the company has managed to improve its profitability and cash flow, prudent management of debt levels will be essential to sustain this trajectory.Income Statement
MasTec's revenue has shown a steady growth trajectory, increasing from $6.32 billion in 2020 to $12.30 billion in 2024, indicating a robust revenue growth rate. Gross profit margin improved significantly in 2024 compared to 2023, indicating enhanced cost efficiency. Net profit margin increased as well, showing a return to profitability from a loss in 2023. EBIT margin improved, reflecting better operational profitability. Overall, strong revenue growth and improved profitability metrics contribute to a high score.85
Very Positive
Balance Sheet
MasTec maintains a stable balance sheet with an improving equity position. The Debt-to-Equity ratio decreased in 2024, indicating reduced leverage risks. Return on Equity (ROE) improved substantially as profitability was restored. The equity ratio is healthy, reflecting a solid capital structure. The strength lies in improved leverage and equity metrics, though attention to debt levels remains prudent.78
Positive
Cash Flow
The company's free cash flow has grown significantly, reflecting strong cash generation capabilities. Operating cash flow to net income ratio indicates efficient cash conversion, and the free cash flow to net income ratio is healthy, suggesting ample cash flow relative to earnings. This strong cash flow performance underlines the company's ability to fund operations and investments, contributing to a high score.88
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 12.30B | 12.00B | 9.78B | 7.95B | 6.32B | Gross Profit |
| 1.63B | 786.81M | 1.19B | 1.15B | 1.05B | EBIT |
| 942.97M | 152.01M | 155.31M | 483.49M | 490.36M | EBITDA |
| 942.97M | 754.86M | 662.46M | 906.31M | 730.90B | Net Income Common Stockholders |
| 162.79M | -49.95M | 33.35M | 328.83M | 322.85M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 399.90M | 529.56M | 370.59M | 360.74M | 423.12M | Total Assets |
| 8.98B | 9.37B | 9.29B | 7.12B | 5.23B | Total Debt |
| 593.58M | 3.50B | 3.51B | 2.05B | 1.27B | Net Debt |
| 193.68M | 2.97B | 3.14B | 1.69B | 851.02M | Total Liabilities |
| 5.99B | 6.65B | 6.55B | 4.58B | 3.22B | Stockholders Equity |
| 2.91B | 2.71B | 2.74B | 2.54B | 2.01B |
| Cash Flow | Free Cash Flow | |||
| 972.77M | 494.34M | 88.94M | 623.01M | 723.51M | Operating Cash Flow |
| 1.12B | 687.28M | 352.30M | 793.07M | 937.25M | Investing Cash Flow |
| -157.49M | -178.06M | -821.18M | -1.36B | -216.60M | Financing Cash Flow |
| -1.09B | -351.00M | 480.90M | 501.94M | -369.89M |
MasTec Technical Analysis
Negative
127.91
Price Trends
140.37
Negative
137.49
Negative
123.86
Positive
Market Momentum
-4.35
Positive
42.18
Neutral
33.51
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MTZ, the sentiment is Negative. The current price of 127.91 is below the 20-day moving average (MA) of 133.83, below the 50-day MA of 140.37, and above the 200-day MA of 123.86, indicating a neutral trend. The MACD of -4.35 indicates Positive momentum. The RSI at 42.18 is Neutral, neither overbought nor oversold. The STOCH value of 33.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MTZ.
MasTec Risk Analysis
MasTec disclosed 35 risk factors in its most recent earnings report. MasTec reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
MasTec Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $17.99B | 18.39 | 34.28% | 0.26% | 15.76% | 61.64% | |
76 Outperform | $3.59B | 20.14 | 12.83% | 0.38% | 11.40% | 42.51% | |
74 Outperform | $9.82B | 60.29 | 5.59% | ― | 2.56% | ― | |
72 Outperform | $36.99B | 41.40 | 12.36% | 0.15% | 13.36% | 20.00% | |
62 Neutral | $8.11B | 13.34 | 1.17% | 3.02% | 4.16% | -15.14% | |
61 Neutral | $4.44B | 19.33 | 18.84% | ― | 12.61% | 7.43% | |
54 Neutral | $1.95B | 65.21 | 4.84% | ― | -7.73% | -65.81% |
* Industrials Sector Average
Performance Comparison
MTZ
MasTec
127.91
39.29
44.34%
DY
Dycom
153.89
19.34
14.37%
EME
EMCOR Group
392.60
67.66
20.82%
MYRG
MYR Group
124.20
-37.30
-23.10%
PRIM
Primoris Services
68.22
28.56
72.01%
PWR
Quanta Services
253.16
11.68
4.84%
MasTec Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: 0.85% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Positive
The earnings call presented a positive outlook with strong revenue and earnings growth across most segments, significant debt reduction, and record backlog levels. However, the decline in pipeline revenue and some margin challenges due to weather were noted as concerns. Overall, the sentiment is positive given the strong financial performance and future growth expectations.Highlights
Strong Revenue and Earnings Growth
Fourth quarter revenue was $3.4 billion, and adjusted EBITDA was $271 million, a 20% year-over-year increase. Fourth quarter adjusted EPS was $1.44, more than double last year’s fourth quarter. For the full year 2024, revenue was $12.3 billion, adjusted EBITDA was $1.6 billion, and full-year adjusted EPS was $3.95.
Reduction in Net Debt and Record Cash Flow
Full year cash flow from operations was $1.1 billion, and net debt was reduced by over $700 million for the year. DSO ended at 60 days, down from 68 days in the third quarter and 74 days the prior year.
Communications and Power Delivery Segment Growth
In the Communications segment, fourth quarter revenues were up 28% over last year’s fourth quarter, with EBITDA up 67%. The Power Delivery segment saw fourth quarter revenues up 16% year-over-year, with backlog up about $900 million year-over-year.
Record Backlog Levels
18-month backlog at year-end totaled $14.3 billion, an increase of over $400 million sequentially and almost $2 billion year-over-year. This represents a record level for MasTec.
Positive Outlook for 2025
For full year 2025, the company expects about 9% revenue and EBITDA growth. Non-pipeline revenues are expected to increase by 14%, and non-pipeline EBITDA to grow over 25%.
Lowlights
Decline in Pipeline Revenue
Fourth quarter revenue in the Pipeline segment was down both year-over-year and sequentially. The company provided revenue guidance of $1.8 billion for 2025, versus just over $2.1 billion achieved in 2024, due to the completion of the Mountain Valley Pipeline.
Challenges in Weather Impacting Margins
Margins in the Pipeline segment were slightly lower than expected in the fourth quarter due to weather impacts, which pushed out revenue and increased costs to finish projects.
Company Guidance
During MasTec's Fourth Quarter 2024 Earnings Conference Call, the company reported strong financial performance and provided optimistic guidance for 2025. For Q4 2024, MasTec achieved revenue of $3.4 billion, adjusted EBITDA of $271 million (a 20% year-over-year increase), and adjusted EPS of $1.44, more than doubling from the previous year. Full-year 2024 results included revenue of $12.3 billion, adjusted EBITDA of $1.6 billion, and adjusted EPS of $3.95. The company also reduced net debt by over $700 million. Looking ahead to 2025, MasTec anticipates approximately 9% growth in both revenue and EBITDA, with non-pipeline revenues expected to increase by 14% and non-pipeline EBITDA by over 25%. The significant growth is supported by a robust backlog and strong customer demand across segments such as Communications, Power Delivery, and Clean Energy. The Communications segment, in particular, is projected to grow 11% year-over-year, while the Clean Energy segment is expected to see a 16% revenue increase.MasTec Corporate Events
Business Operations and StrategyFinancial Disclosures
MasTec Reports Record 2024 Revenues and Strong 2025 Outlook
Positive
Feb 28, 2025
On February 27, 2025, MasTec announced its financial results for the fourth quarter and full year of 2024, reporting record revenues of $3.4 billion for the quarter and $12.3 billion for the year. The company also achieved a significant increase in cash flow from operations and a reduction in net debt, with a record 18-month backlog of $14.3 billion. MasTec provided initial guidance for 2025, projecting a 9% revenue increase to $13.45 billion, with improvements in net income and earnings per share. The company’s strong financial performance in 2024, highlighted by a substantial backlog growth, positions it well for continued growth and operational success in 2025.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.