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Quanta Services (PWR)
NYSE:PWR
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Quanta Services
(NYSE:PWR)72Outperform
Positive Factors
Growth Opportunities
PWR has multiple avenues for growth and attractive risk/reward from here.
Market Position
PWR is an increasingly indispensable partner to the largest North American utilities and renewable power developers.
Negative Factors
Revenue Concerns
There was some concern regarding whether PWR’s revenue target for 2025 had been helped by acquisitions.
Quanta Services (PWR) vs. S&P 500 (SPY)
Market Cap
$36.99B
Dividend Yield0.15%
Average Volume (3M)1.99M
Price to Earnings (P/E)41.4
Beta (1Y)1.47
Revenue Growth13.36%
EPS Growth20.00%
CountryUS
Employees52,500
SectorIndustrials
Sector Strength66
IndustryConstruction
Share Statistics
EPS (TTM)6.02
Shares Outstanding148,198,320
10 Day Avg. Volume2,645,973
30 Day Avg. Volume1,993,833
Financial Highlights & Ratios
PEG Ratio2.07
Price to Book (P/B)N/A
Price to Sales (P/S)1.57
Price to Cash Flow (P/CF)13.10
P/FCF Ratio15.70
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$341.93Price Target Upside35.06% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering17
Quanta Services Business Overview & Revenue Model
Company DescriptionQuanta Services, Inc. engages in the provision of specialty contracting services, offering infrastructure solutions to the electric power, oil and gas, and communication industries. It also focuses on the design, installation, upgrade, repair, and maintenance of infrastructure within each of the industries it serves. It operates through the Electric Power Infrastructure Services, and Pipeline and Industrial Infrastructure Services segment. The Electric Power Infrastructure Services segment provides network solutions to customers in the electric power industry. The Pipeline and Industrial Infrastructure Services segment offers infrastructure solutions to customers involved in the development and transportation of natural gas, oil and other pipeline products. The company was founded by Kevin D. Miller, Steven P. Colmar, William G. Parkhouse and John R. Colson on August 19, 1997 and is headquartered in Houston, TX.
How the Company Makes MoneyQuanta Services generates revenue primarily through its contract-based services offered to utility, energy, and industrial companies. The company earns money by providing end-to-end solutions for electric power and energy infrastructure projects, including the development and maintenance of transmission and distribution systems, substations, and renewable energy facilities. A significant portion of its revenue comes from long-term contracts and service agreements with large utility companies and energy producers. Additionally, Quanta Services benefits from strategic partnerships with entities seeking to expand or upgrade their infrastructure capabilities, along with favorable regulatory environments that encourage investment in energy infrastructure.
Quanta Services Financial Statement Overview
Summary
Quanta Services exhibits strong revenue growth and profitability improvements, supported by a solid balance sheet with improved leverage ratios. However, the absence of reported cash flow in 2024 presents a risk that requires attention to ensure liquidity and support operations.Income Statement
Quanta Services has shown a robust revenue growth, with a 13.37% increase from 2023 to 2024. The gross profit margin stands at 14.83% for 2024, indicating efficient cost management. The net profit margin improved to 3.82%, reflecting enhanced profitability. EBIT and EBITDA margins of 5.68% indicate solid operational performance. Overall, strong revenue growth and margin improvements highlight a positive trend in profitability.85
Very Positive
Balance Sheet
The company's debt-to-equity ratio improved significantly to 0.05 in 2024, showcasing a strong capital structure. Return on equity (ROE) increased to 12.37%, indicating efficient use of shareholders' funds. The equity ratio of 39.16% suggests a healthy balance sheet, although there is room for improvement in reducing liabilities further. Overall, the balance sheet reflects a strong position with improved leverage and profitability metrics.78
Positive
Cash Flow
Quanta Services faced challenges in 2024 with no reported operating cash flow and free cash flow, indicating potential liquidity constraints. The absence of these cash flows raises concerns about cash generation capabilities. While historical free cash flow growth was positive, the lack of cash flow data in 2024 limits a full assessment of cash flow strength. The company needs to address cash flow generation to ensure financial stability.55
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 23.67B | 20.88B | 17.07B | 12.98B | 11.20B | Gross Profit |
| 3.51B | 2.94B | 2.53B | 1.95B | 1.66B | EBIT |
| 1.35B | 1.13B | 872.06M | 663.52M | 611.37M | EBITDA |
| 2.16B | 1.77B | 1.48B | 1.05B | 911.03M | Net Income Common Stockholders |
| 904.82M | 744.69M | 491.19M | 485.96M | 445.60M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 741.96M | 1.29B | 428.50M | 229.10M | 184.62M | Total Assets |
| 18.68B | 16.24B | 13.46B | 12.86B | 8.40B | Total Debt |
| 379.20M | 4.46B | 3.98B | 4.00B | 1.45B | Net Debt |
| -362.76M | 3.17B | 3.55B | 3.77B | 1.27B | Total Liabilities |
| 11.35B | 9.95B | 8.07B | 7.74B | 4.05B | Stockholders Equity |
| 7.32B | 6.27B | 5.38B | 5.11B | 4.34B |
| Cash Flow | Free Cash Flow | |||
| 1.48B | 1.14B | 701.53M | 195.67M | 855.40M | Operating Cash Flow |
| 2.08B | 1.58B | 1.13B | 582.39M | 1.12B | Investing Cash Flow |
| -2.29B | -989.65M | -617.19M | -2.90B | -499.32M | Financing Cash Flow |
| -305.64M | 268.50M | -311.07M | 2.36B | -601.37M |
Quanta Services Technical Analysis
Negative
253.16
Price Trends
305.73
Negative
314.57
Negative
291.75
Negative
Market Momentum
-16.39
Positive
31.04
Neutral
13.13
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PWR, the sentiment is Negative. The current price of 253.16 is below the 20-day moving average (MA) of 280.27, below the 50-day MA of 305.73, and below the 200-day MA of 291.75, indicating a bearish trend. The MACD of -16.39 indicates Positive momentum. The RSI at 31.04 is Neutral, neither overbought nor oversold. The STOCH value of 13.13 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PWR.
Quanta Services Risk Analysis
Quanta Services disclosed 47 risk factors in its most recent earnings report. Quanta Services 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
Quanta Services 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
PWR
Quanta Services
253.16
11.68
4.84%
DY
Dycom
153.89
19.34
14.37%
EME
EMCOR Group
392.60
67.66
20.82%
MTZ
MasTec
127.91
39.29
44.34%
MYRG
MYR Group
124.20
-37.30
-23.10%
PRIM
Primoris Services
68.22
28.56
72.01%
Quanta Services Earnings Call Summary
Earnings Call Date: Feb 20, 2025 | % Change Since: -13.32% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Positive
Quanta Services reported a successful 2024 with record growth and strong financial performance, driven by strategic initiatives and acquisitions. Despite minor challenges related to weather impacts and certain market segments, the company is well-positioned for continued growth in 2025.Highlights
Record Financial Metrics
Quanta Services reported double-digit growth in revenues and earnings for the fourth quarter and full year 2024, achieving record financial metrics, including a total backlog at year-end of $34.5 billion.
Renewable Energy Infrastructure Achievements
The renewable energy infrastructure solutions segment achieved all-time highs in both twelve-month and total backlog.
Excellent Cash Flow Performance
Fourth quarter and full year free cash flow exceeded the upper end of guidance expectations, with a record full-year free cash flow of $1.6 billion.
Strategic Acquisitions
Quanta acquired two companies for approximately $562 million in cash and stock, supporting organic growth and opportunistic capital investment.
2025 Growth Expectations
Quanta expects another year of profitable growth in 2025 with record revenues, improved margins, and double-digit growth in adjusted EBITDA and adjusted earnings per share.
Lowlights
Impact of Weather on Industrial Business
Storms in the Gulf Coast affected the industrial business's performance in the back half of 2024, contributing to lower margins in the underground segment.
Challenges with Combined Cycle Generation
Quanta is cautious about entering the combined cycle generation market due to high costs and risks associated with building these plants.
Company Guidance
During the Quanta Services fourth quarter and full year 2024 earnings call, the company provided guidance indicating another year of profitable growth for 2025. Quanta expects record revenues with improved margins, and aims for double-digit growth in adjusted EBITDA and adjusted earnings per share. The company ended 2024 with a total backlog of $34.5 billion, which includes all-time highs in the renewable energy infrastructure solutions segment. For the fourth quarter of 2024, Quanta reported revenues of $6.6 billion, net income of $305.1 million, adjusted diluted earnings per share of $2.94, and adjusted EBITDA of $737.8 million, representing 11.3% of revenues. Additionally, Quanta achieved record free cash flow of $1.6 billion for the year. The company announced a resegmentation, combining its electric power infrastructure solutions and renewable energy infrastructure solutions into the new electric infrastructure solutions segment. This change reflects how the business is managed and aims to align with the growing and converging market opportunities.Quanta Services Corporate Events
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Quanta Services Reports Strong 2024 Financial Results
Positive
Feb 20, 2025
Quanta Services reported strong financial results for the fourth quarter and full year of 2024, with significant increases in revenue, net income, and adjusted earnings per share compared to the previous year. The company achieved record revenues of $23.67 billion for the year and anticipates continued growth in 2025, driven by its robust project backlog and strategic acquisitions, including a large fiber build project and new acquisitions in the U.S. and Australia. Quanta remains well-positioned to capitalize on industry trends and expand its market presence as a leader in infrastructure solutions.
Executive/Board Changes
Quanta Services COO Redgie Probst Resigns, CEO Takes Over
Neutral
Jan 7, 2025
J. Redgie Probst has resigned as Chief Operating Officer of Quanta Services, Inc., effective December 31, 2024, to spend more time with his family. His departure was amicable, and he will continue with the company in a non-executive role. Following his resignation, Earl C. (Duke) Austin, Jr., the current President and CEO, will also assume the role of principal operating officer.
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.