QUANTA SERVICES INC (PWR) Stock Fundamental Analysis
NYSE:PWR - New York Stock Exchange, Inc. - US74762E1029 - Common Stock - Currency: USD
Overall PWR gets a fundamental rating of 6 out of 10. We evaluated PWR against 50 industry peers in the Construction & Engineering industry. While PWR belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. PWR is valued quite expensively, but it does show have an excellent growth rating. These ratings could make PWR a good candidate for growth investing.
1. Profitability
1.1 Basic Checks
PWR had positive earnings in the past year.
In the past year PWR had a positive cash flow from operations.
In the past 5 years PWR has always been profitable.
In the past 5 years PWR always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of PWR (4.86%) is better than 66.00% of its industry peers.
The Return On Equity of PWR (12.48%) is better than 64.00% of its industry peers.
PWR has a Return On Invested Capital of 8.07%. This is in the better half of the industry: PWR outperforms 66.00% of its industry peers.
PWR had an Average Return On Invested Capital over the past 3 years of 7.28%. This is significantly below the industry average of 17.39%.
The last Return On Invested Capital (8.07%) for PWR is above the 3 year average (7.28%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.86% | ||
| ROE | 12.48% | ||
| ROIC | 8.07% |
ROA(3y)4.36%
ROA(5y)4.43%
ROE(3y)11.12%
ROE(5y)10.62%
ROIC(3y)7.28%
ROIC(5y)6.8%
1.3 Margins
The Profit Margin of PWR (3.74%) is better than 64.00% of its industry peers.
PWR's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 5.54%, PWR is in line with its industry, outperforming 56.00% of the companies in the same industry.
PWR's Operating Margin has improved in the last couple of years.
PWR has a Gross Margin of 14.96%. This is comparable to the rest of the industry: PWR outperforms 48.00% of its industry peers.
PWR's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.54% | ||
| PM (TTM) | 3.74% | ||
| GM | 14.96% |
OM growth 3Y4.36%
OM growth 5Y3.12%
PM growth 3Y0.69%
PM growth 5Y2.86%
GM growth 3Y-0.48%
GM growth 5Y2.34%
2. Health
2.1 Basic Checks
PWR has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, PWR has more shares outstanding
Compared to 5 years ago, PWR has more shares outstanding
The debt/assets ratio for PWR has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.69 indicates that PWR is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 4.69, PWR is doing good in the industry, outperforming 74.00% of the companies in the same industry.
The Debt to FCF ratio of PWR is 3.10, which is a good value as it means it would take PWR, 3.10 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of PWR (3.10) is better than 62.00% of its industry peers.
PWR has a Debt/Equity ratio of 0.58. This is a neutral value indicating PWR is somewhat dependend on debt financing.
PWR has a Debt to Equity ratio (0.58) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | 3.1 | ||
| Altman-Z | 4.69 |
ROIC/WACC0.84
WACC9.65%
2.3 Liquidity
PWR has a Current Ratio of 1.31. This is a normal value and indicates that PWR is financially healthy and should not expect problems in meeting its short term obligations.
PWR has a Current ratio (1.31) which is in line with its industry peers.
A Quick Ratio of 1.26 indicates that PWR should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.26, PWR perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.31 | ||
| Quick Ratio | 1.26 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 27.25% over the past year.
PWR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 18.25% yearly.
Looking at the last year, PWR shows a quite strong growth in Revenue. The Revenue has grown by 15.77% in the last year.
The Revenue has been growing by 14.34% on average over the past years. This is quite good.
EPS 1Y (TTM)27.25%
EPS 3Y22.25%
EPS 5Y18.25%
EPS Q2Q%26.24%
Revenue 1Y (TTM)15.77%
Revenue growth 3Y22.18%
Revenue growth 5Y14.34%
Sales Q2Q%23.88%
3.2 Future
Based on estimates for the next years, PWR will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.52% on average per year.
The Revenue is expected to grow by 11.67% on average over the next years. This is quite good.
EPS Next Y14.75%
EPS Next 2Y14.71%
EPS Next 3Y16.29%
EPS Next 5Y14.52%
Revenue Next Year13.69%
Revenue Next 2Y11.6%
Revenue Next 3Y12.1%
Revenue Next 5Y11.67%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 36.74, PWR can be considered very expensive at the moment.
PWR's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of PWR to the average of the S&P500 Index (24.85), we can say PWR is valued slightly more expensively.
With a Price/Forward Earnings ratio of 29.07, PWR can be considered very expensive at the moment.
The rest of the industry has a similar Price/Forward Earnings ratio as PWR.
PWR's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 20.89.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.74 | ||
| Fwd PE | 29.07 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of PWR indicates a slightly more expensive valuation: PWR is more expensive than 62.00% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PWR is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.53 | ||
| EV/EBITDA | 25.33 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of PWR may justify a higher PE ratio.
A more expensive valuation may be justified as PWR's earnings are expected to grow with 16.29% in the coming years.
PEG (NY)2.49
PEG (5Y)2.01
EPS Next 2Y14.71%
EPS Next 3Y16.29%
5. Dividend
5.1 Amount
PWR has a yearly dividend return of 0.12%, which is pretty low.
PWR's Dividend Yield is a higher than the industry average which is at 1.83.
Compared to an average S&P500 Dividend Yield of 2.40, PWR's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.12% |
5.2 History
On average, the dividend of PWR grows each year by 17.70%, which is quite nice.
PWR has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)17.7%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
6.01% of the earnings are spent on dividend by PWR. This is a low number and sustainable payout ratio.
PWR's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP6.01%
EPS Next 2Y14.71%
EPS Next 3Y16.29%
343.15
-0.43 (-0.13%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryConstruction & Engineering
Earnings (Last)
Earnings (Next)
Inst Owners96.39%
Inst Owner Change0.43%
Ins Owners0.81%
Ins Owner Change4.22%
Market Cap50.88B
Analysts80
Price Target352.52 (2.73%)
Short Float %3.47%
Short Ratio3.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.12% |
Yearly Dividend0.37
Dividend Growth(5Y)17.7%
DP6.01%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.25%
Min EPS beat(2)5.43%
Max EPS beat(2)11.07%
EPS beat(4)3
Avg EPS beat(4)3.99%
Min EPS beat(4)-0.66%
Max EPS beat(4)11.07%
EPS beat(8)6
Avg EPS beat(8)3.9%
EPS beat(12)9
Avg EPS beat(12)3.6%
EPS beat(16)13
Avg EPS beat(16)4.02%
Revenue beat(2)1
Avg Revenue beat(2)1.69%
Min Revenue beat(2)-1.87%
Max Revenue beat(2)5.24%
Revenue beat(4)2
Avg Revenue beat(4)0.47%
Min Revenue beat(4)-2.09%
Max Revenue beat(4)5.24%
Revenue beat(8)6
Avg Revenue beat(8)3.17%
Revenue beat(12)10
Avg Revenue beat(12)3.27%
Revenue beat(16)12
Avg Revenue beat(16)3.21%
PT rev (1m)0.13%
PT rev (3m)-2.95%
EPS NQ rev (1m)-1.26%
EPS NQ rev (3m)0.49%
EPS NY rev (1m)-0.04%
EPS NY rev (3m)-0.27%
Revenue NQ rev (1m)-0.36%
Revenue NQ rev (3m)-0.17%
Revenue NY rev (1m)0.38%
Revenue NY rev (3m)0.78%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.74 | ||
| Fwd PE | 29.07 | ||
| P/S | 2.05 | ||
| P/FCF | 35.53 | ||
| P/OCF | 24.38 | ||
| P/B | 6.82 | ||
| P/tB | N/A | ||
| EV/EBITDA | 25.33 |
EPS(TTM)9.34
EY2.72%
EPS(NY)11.8
Fwd EY3.44%
FCF(TTM)9.66
FCFY2.81%
OCF(TTM)14.07
OCFY4.1%
SpS167.77
BVpS50.29
TBVpS-0.42
PEG (NY)2.49
PEG (5Y)2.01
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.86% | ||
| ROE | 12.48% | ||
| ROCE | 10.49% | ||
| ROIC | 8.07% | ||
| ROICexc | 8.4% | ||
| ROICexgc | 20.77% | ||
| OM | 5.54% | ||
| PM (TTM) | 3.74% | ||
| GM | 14.96% | ||
| FCFM | 5.76% |
ROA(3y)4.36%
ROA(5y)4.43%
ROE(3y)11.12%
ROE(5y)10.62%
ROIC(3y)7.28%
ROIC(5y)6.8%
ROICexc(3y)7.87%
ROICexc(5y)7.25%
ROICexgc(3y)18.13%
ROICexgc(5y)15.89%
ROCE(3y)9.46%
ROCE(5y)8.84%
ROICexcg growth 3Y19.69%
ROICexcg growth 5Y10.82%
ROICexc growth 3Y17.18%
ROICexc growth 5Y2.48%
OM growth 3Y4.36%
OM growth 5Y3.12%
PM growth 3Y0.69%
PM growth 5Y2.86%
GM growth 3Y-0.48%
GM growth 5Y2.34%
F-Score4
Asset Turnover1.3
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | 3.1 | ||
| Debt/EBITDA | 2.02 | ||
| Cap/Depr | 83.54% | ||
| Cap/Sales | 2.63% | ||
| Interest Coverage | 7.06 | ||
| Cash Conversion | 96.47% | ||
| Profit Quality | 153.84% | ||
| Current Ratio | 1.31 | ||
| Quick Ratio | 1.26 | ||
| Altman-Z | 4.69 |
F-Score4
WACC9.65%
ROIC/WACC0.84
Cap/Depr(3y)73.31%
Cap/Depr(5y)79.62%
Cap/Sales(3y)2.39%
Cap/Sales(5y)2.5%
Profit Quality(3y)152.78%
Profit Quality(5y)138.11%
High Growth Momentum
Growth
EPS 1Y (TTM)27.25%
EPS 3Y22.25%
EPS 5Y18.25%
EPS Q2Q%26.24%
EPS Next Y14.75%
EPS Next 2Y14.71%
EPS Next 3Y16.29%
EPS Next 5Y14.52%
Revenue 1Y (TTM)15.77%
Revenue growth 3Y22.18%
Revenue growth 5Y14.34%
Sales Q2Q%23.88%
Revenue Next Year13.69%
Revenue Next 2Y11.6%
Revenue Next 3Y12.1%
Revenue Next 5Y11.67%
EBIT growth 1Y23.89%
EBIT growth 3Y27.5%
EBIT growth 5Y17.91%
EBIT Next Year102.82%
EBIT Next 3Y37.43%
EBIT Next 5Y27.75%
FCF growth 1Y109.22%
FCF growth 3Y96.17%
FCF growth 5Y41.08%
OCF growth 1Y92.54%
OCF growth 3Y52.89%
OCF growth 5Y31.64%