QUANTA SERVICES INC (PWR) Stock Fundamental Analysis
NYSE:PWR - New York Stock Exchange, Inc. - US74762E1029 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to PWR. PWR was compared to 52 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. With these ratings, PWR could be worth investigating further for growth investing!.
1. Profitability
1.1 Basic Checks
PWR had positive earnings in the past year.
PWR had a positive operating cash flow in the past year.
Each year in the past 5 years PWR has been profitable.
Each year in the past 5 years PWR had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 4.86%, PWR is in the better half of the industry, outperforming 65.38% of the companies in the same industry.
Looking at the Return On Equity, with a value of 12.48%, PWR is in the better half of the industry, outperforming 65.38% of the companies in the same industry.
With a decent Return On Invested Capital value of 8.07%, PWR is doing good in the industry, outperforming 67.31% 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 16.67%.
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 65.38% of the companies in the same industry.
In the last couple of years the Profit Margin of PWR has grown nicely.
PWR has a Operating Margin (5.54%) which is in line with its industry peers.
In the last couple of years the Operating Margin of PWR has grown nicely.
PWR has a Gross Margin of 14.96%. This is comparable to the rest of the industry: PWR outperforms 50.00% of its industry peers.
In the last couple of years the Gross Margin of PWR has grown nicely.
| 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.
Compared to 1 year ago, PWR has more shares outstanding
Compared to 5 years ago, PWR has more shares outstanding
Compared to 1 year ago, PWR has an improved debt to assets ratio.
2.2 Solvency
PWR has an Altman-Z score of 5.02. This indicates that PWR is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 5.02, PWR is doing good in the industry, outperforming 71.15% of the companies in the same industry.
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.
The Debt to FCF ratio of PWR (3.10) is better than 69.23% of its industry peers.
A Debt/Equity ratio of 0.58 indicates that PWR is somewhat dependend on debt financing.
PWR has a Debt to Equity ratio (0.58) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | 3.1 | ||
| Altman-Z | 5.02 |
ROIC/WACC0.81
WACC9.93%
2.3 Liquidity
A Current Ratio of 1.31 indicates that PWR should not have too much problems paying its short term obligations.
PWR's Current ratio of 1.31 is in line compared to the rest of the industry. PWR outperforms 55.77% of its industry peers.
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's Quick ratio of 1.26 is in line compared to the rest of the industry. PWR outperforms 57.69% 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.
The Earnings Per Share has been growing by 18.25% on average over the past years. This is quite good.
The Revenue has grown by 15.77% in the past year. This is quite good.
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
The Earnings Per Share is expected to grow by 14.68% on average over the next years. This is quite good.
The Revenue is expected to grow by 11.53% on average over the next years. This is quite good.
EPS Next Y16.54%
EPS Next 2Y15.38%
EPS Next 3Y16.21%
EPS Next 5Y14.68%
Revenue Next Year13.78%
Revenue Next 2Y11.53%
Revenue Next 3Y12.02%
Revenue Next 5Y11.53%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last 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 41.38.
Compared to the rest of the industry, the Price/Earnings ratio of PWR is on the same level as its industry peers.
PWR is valuated expensively when we compare the Price/Earnings ratio to 27.45, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 32.37, which means the current valuation is very expensive for PWR.
PWR's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 21.90. PWR is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.38 | ||
| Fwd PE | 32.37 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as PWR.
PWR's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 40.01 | ||
| EV/EBITDA | 28.3 |
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 16.21% in the coming years.
PEG (NY)2.5
PEG (5Y)2.27
EPS Next 2Y15.38%
EPS Next 3Y16.21%
5. Dividend
5.1 Amount
With a yearly dividend of 0.11%, PWR is not a good candidate for dividend investing.
PWR's Dividend Yield is a higher than the industry average which is at 1.75.
With a Dividend Yield of 0.11, PWR pays less dividend than the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.11% |
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.
PWR's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP6.01%
EPS Next 2Y15.38%
EPS Next 3Y16.21%
386.51
+13.1 (+3.51%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryConstruction & Engineering
Earnings (Last)
Earnings (Next)
Inst Owners94.59%
Inst Owner Change-0.85%
Ins Owners0.61%
Ins Owner Change4.47%
Market Cap57.28B
Analysts80
Price Target363.48 (-5.96%)
Short Float %3.05%
Short Ratio3.65
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.11% |
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)3.11%
PT rev (3m)2.57%
EPS NQ rev (1m)0.17%
EPS NQ rev (3m)-1.63%
EPS NY rev (1m)-0.07%
EPS NY rev (3m)1.52%
Revenue NQ rev (1m)-0.15%
Revenue NQ rev (3m)-0.33%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)0.46%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 41.38 | ||
| Fwd PE | 32.37 | ||
| P/S | 2.3 | ||
| P/FCF | 40.01 | ||
| P/OCF | 27.45 | ||
| P/B | 7.68 | ||
| P/tB | N/A | ||
| EV/EBITDA | 28.3 |
EPS(TTM)9.34
EY2.42%
EPS(NY)11.94
Fwd EY3.09%
FCF(TTM)9.66
FCFY2.5%
OCF(TTM)14.08
OCFY3.64%
SpS167.84
BVpS50.31
TBVpS-0.42
PEG (NY)2.5
PEG (5Y)2.27
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 | 5.02 |
F-Score4
WACC9.93%
ROIC/WACC0.81
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 Y16.54%
EPS Next 2Y15.38%
EPS Next 3Y16.21%
EPS Next 5Y14.68%
Revenue 1Y (TTM)15.77%
Revenue growth 3Y22.18%
Revenue growth 5Y14.34%
Sales Q2Q%23.88%
Revenue Next Year13.78%
Revenue Next 2Y11.53%
Revenue Next 3Y12.02%
Revenue Next 5Y11.53%
EBIT growth 1Y23.89%
EBIT growth 3Y27.5%
EBIT growth 5Y17.91%
EBIT Next Year104.6%
EBIT Next 3Y36.36%
EBIT Next 5Y26.97%
FCF growth 1Y109.22%
FCF growth 3Y96.17%
FCF growth 5Y41.08%
OCF growth 1Y92.54%
OCF growth 3Y52.89%
OCF growth 5Y31.64%