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 51 industry peers in the Construction & Engineering industry. PWR scores excellent on profitability, but there are some minor concerns on its financial health. PWR shows excellent growth, but is valued quite expensive already. This makes PWR very considerable for growth investing!
1. Profitability
1.1 Basic Checks
In the past year PWR was profitable.
PWR had a positive operating cash flow in the past year.
Each year in the past 5 years PWR has been profitable.
In the past 5 years PWR always reported a positive cash flow from operatings.
1.2 Ratios
PWR has a better Return On Assets (4.86%) than 66.67% of its industry peers.
With a decent Return On Equity value of 12.48%, PWR is doing good in the industry, outperforming 64.71% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 8.07%, PWR is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for PWR is significantly below the industry average of 16.96%.
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
Looking at the Profit Margin, with a value of 3.74%, PWR is in the better half of the industry, outperforming 64.71% of the companies in the same industry.
PWR's Profit Margin has improved in the last couple of years.
The Operating Margin of PWR (5.54%) is comparable to the rest of the industry.
PWR's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 14.96%, PWR perfoms like the industry average, outperforming 49.02% of the companies in the same industry.
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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so PWR is destroying value.
PWR has more shares outstanding than it did 1 year ago.
PWR has more shares outstanding than it did 5 years ago.
PWR has a better debt/assets ratio than last year.
2.2 Solvency
PWR has an Altman-Z score of 4.68. This indicates that PWR is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of PWR (4.68) is better than 74.51% of its industry peers.
PWR has a debt to FCF ratio of 3.10. This is a good value and a sign of high solvency as PWR would need 3.10 years to pay back of all of its debts.
PWR has a better Debt to FCF ratio (3.10) than 62.75% of its industry peers.
A Debt/Equity ratio of 0.58 indicates that PWR is somewhat dependend on debt financing.
PWR's Debt to Equity ratio of 0.58 is in line compared to the rest of the industry. PWR outperforms 54.90% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | 3.1 | ||
| Altman-Z | 4.68 |
ROIC/WACC0.78
WACC10.36%
2.3 Liquidity
A Current Ratio of 1.31 indicates that PWR should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.31, PWR is in line with its industry, outperforming 50.98% of the companies in the same industry.
PWR has a Quick Ratio of 1.26. 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 Quick ratio of 1.26. This is comparable to the rest of the industry: PWR outperforms 49.02% of its industry peers.
| 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.
Measured over the past years, PWR shows a quite strong growth in Earnings Per Share. The EPS has been growing by 18.25% on average per year.
Looking at the last year, PWR shows a quite strong growth in Revenue. The Revenue has grown by 15.77% in the last year.
PWR shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.34% yearly.
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
The Earnings Per Share is expected to grow by 14.52% on average over the next years. This is quite good.
The Revenue is expected to grow by 11.67% on average over the next years. This is quite good.
EPS Next Y16.62%
EPS Next 2Y15.37%
EPS Next 3Y16.18%
EPS Next 5Y14.52%
Revenue Next Year13.75%
Revenue Next 2Y11.4%
Revenue Next 3Y11.76%
Revenue Next 5Y11.67%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
PWR is valuated quite expensively with a Price/Earnings ratio of 35.42.
The rest of the industry has a similar Price/Earnings ratio as PWR.
PWR is valuated rather expensively when we compare the Price/Earnings ratio to 25.91, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 27.71, which means the current valuation is very expensive for PWR.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PWR is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of PWR to the average of the S&P500 Index (21.85), we can say PWR is valued slightly more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.42 | ||
| Fwd PE | 27.71 |
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 60.78% of the companies listed in the same industry.
PWR's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.26 | ||
| EV/EBITDA | 25.2 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PWR does not grow enough to justify the current Price/Earnings ratio.
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 16.18% in the coming years.
PEG (NY)2.13
PEG (5Y)1.94
EPS Next 2Y15.37%
EPS Next 3Y16.18%
5. Dividend
5.1 Amount
PWR has a yearly dividend return of 0.12%, which is pretty low.
Compared to an average industry Dividend Yield of 1.72, PWR pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.12, PWR pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.12% |
5.2 History
The dividend of PWR is nicely growing with an annual growth rate of 17.70%!
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.
The dividend of PWR is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP6.01%
EPS Next 2Y15.37%
EPS Next 3Y16.18%
330.83
-10.4 (-3.05%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryConstruction & Engineering
Earnings (Last)
Earnings (Next)
Inst Owners96.39%
Inst Owner Change-0.82%
Ins Owners0.81%
Ins Owner Change4.22%
Market Cap49.05B
Analysts80
Price Target352.52 (6.56%)
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)-1.74%
EPS NQ rev (3m)0%
EPS NY rev (1m)1.63%
EPS NY rev (3m)1.33%
Revenue NQ rev (1m)-0.18%
Revenue NQ rev (3m)0.02%
Revenue NY rev (1m)0.43%
Revenue NY rev (3m)0.83%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 35.42 | ||
| Fwd PE | 27.71 | ||
| P/S | 1.97 | ||
| P/FCF | 34.26 | ||
| P/OCF | 23.51 | ||
| P/B | 6.58 | ||
| P/tB | N/A | ||
| EV/EBITDA | 25.2 |
EPS(TTM)9.34
EY2.82%
EPS(NY)11.94
Fwd EY3.61%
FCF(TTM)9.66
FCFY2.92%
OCF(TTM)14.07
OCFY4.25%
SpS167.77
BVpS50.29
TBVpS-0.42
PEG (NY)2.13
PEG (5Y)1.94
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 | 4.68 |
F-Score4
WACC10.36%
ROIC/WACC0.78
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 Y16.62%
EPS Next 2Y15.37%
EPS Next 3Y16.18%
EPS Next 5Y14.52%
Revenue 1Y (TTM)15.77%
Revenue growth 3Y22.18%
Revenue growth 5Y14.34%
Sales Q2Q%23.88%
Revenue Next Year13.75%
Revenue Next 2Y11.4%
Revenue Next 3Y11.76%
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%