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Quanta (PWR) Q4 Earnings & Revenues Beat Estimates, Stock up
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Quanta Services Inc. (PWR - Free Report) reported impressive earnings for fourth-quarter 2020. Adjusted earnings not only surpassed the Zacks Consensus Estimate but also grew impressively on a year-over-year basis. Meanwhile, revenues for the quarter beat the consensus mark but declined on a year-over-year basis.
Duke Austin, President and Chief Executive Officer of Quanta, said, "Quanta's utility solutions and delivery model continue to produce world-class execution and performance, which drove fourth quarter results that exceeded our expectations and completed a solid year for Quanta that included improved profitability and record earnings per share and backlog, despite the unprecedented conditions caused by the global pandemic."
Notably, positive investor sentiments were witnessed as shares of the company climbed 3.4% during the pre-market trading session on Feb 25.
Quanta Services, Inc. Price, Consensus and EPS Surprise
For the quarter under review, Quanta reported adjusted earnings of $1.22 per share that comfortably topped the consensus estimate of 98 cents by 24.5% and increased 31.2% from 93 cents a year ago.
Total revenues of $2,912.2 million surpassed the consensus mark of $2,907 million by 0.2%. The figure decreased 6.4% year over year due to lower contribution from its Underground Utility and Infrastructure Solutions segment.
Operating margin for the quarter rose 130 basis points or bps from a year ago to 6%. Adjusted EBITDA of $319.8 million also improved 21.9% from $262.3 million a year ago.
The company reported 12-month backlog of $8,266.6 million and total backlog of $15,132.4 million at December 2020-end. At September 2020-end, 12-month backlog came in at $8,143 million and total backlog was $15,071.6 million. Moreover, the said metrics increased from 2019-end respective figures of $7,947.1 million and $15,004.9 million.
Segment Details
At Dec 31, 2020, Quanta changed the name of Electric Power Infrastructure Services and Pipeline and Industrial Infrastructure Services segments to Electric Power Infrastructure Solutions and Underground Utility and Infrastructure Solutions, respectively. Nonetheless, there was no change in the composition of the segments.
The company reports results under two reportable segments: Electric Power Infrastructure Solutions segment (accounting for 69.4% of 2020 revenues), and Underground Utility and Infrastructure Solutions (30.6%).
Fourth-quarter revenues from Electric Power Infrastructure Services totaled $2,105.8 million, increasing 14% year over year. Operating margins expanded 290 bps to 11.6%. The segment’s 12-month backlog was $6,070.6 million, up from $5,356.6 million a year ago. Total backlog of $10,981.2 million also grew from $9,822.2 million reported in the prior-year quarter.
Within the Underground Utility and Infrastructure Solutions segment, revenues declined 36.3% from the prior-year quarter to $806.4 million. Operating margin of 5.1% also contracted 190 bps year over year. The segment’s 12-month backlog totaled $2,196 million, down from $2,590.5 million a year ago. Also, total backlog declined to $4,151.2 million from $5,182.7 million in the prior-year quarter.
2020 Highlights
Adjusted earnings came in at $3.82 per share, up from $3.33 in 2019. Total revenues were $11.2 billion, down from $12.1 billion in 2019. Operating margin of 5.5% improved 90 bps for 2020. Adjusted EBITDA also increased to $1.05 billion from $941.8 million in 2019.
Liquidity
As of Dec 31, 2020, Quanta had cash and cash equivalents of $184.6 million compared with $164.8 million at 2019-end. The company’s long-term debt (net of current maturities) amounted to $1,174.3 million, down from $1,292.2 million as of Dec 31, 2019.
Net cash provided by operating activities was $1,116 million for 2020 compared with $526.6 million in 2019. Free cash flow for 2020 came in at $891.9 million compared with $297.9 million reported in 2019.
Recent Achievements
During the fourth quarter, Quanta completed the acquisition of a business that primarily provides aviation services to the utility industry, principally in California. Additionally, it completed another acquisition of a company that provides heavy civil, industrial, and energy construction and maintenance services in the western United States.
Other top-ranked stocks in the same space include Gates Industrial Corporation plc (GTES - Free Report) , AECOM (ACM - Free Report) and Mayville Engineering Company, Inc. (MEC - Free Report) . While Gates Industrial currently sports a Zacks Rank #1, AECOM and Mayville Engineering carry a Zacks Rank #2.
Gates Industrial’s 2021 earnings are expected to surge 61.4%.
AECOM’s fiscal 2021 earnings are expected to grow 24.7%.
Mayville’s 2021 earnings are expected to grow 238.3%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
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Quanta (PWR) Q4 Earnings & Revenues Beat Estimates, Stock up
Quanta Services Inc. (PWR - Free Report) reported impressive earnings for fourth-quarter 2020. Adjusted earnings not only surpassed the Zacks Consensus Estimate but also grew impressively on a year-over-year basis. Meanwhile, revenues for the quarter beat the consensus mark but declined on a year-over-year basis.
Duke Austin, President and Chief Executive Officer of Quanta, said, "Quanta's utility solutions and delivery model continue to produce world-class execution and performance, which drove fourth quarter results that exceeded our expectations and completed a solid year for Quanta that included improved profitability and record earnings per share and backlog, despite the unprecedented conditions caused by the global pandemic."
Notably, positive investor sentiments were witnessed as shares of the company climbed 3.4% during the pre-market trading session on Feb 25.
Quanta Services, Inc. Price, Consensus and EPS Surprise
Quanta Services, Inc. price-consensus-eps-surprise-chart | Quanta Services, Inc. Quote
Detailed Discussion
For the quarter under review, Quanta reported adjusted earnings of $1.22 per share that comfortably topped the consensus estimate of 98 cents by 24.5% and increased 31.2% from 93 cents a year ago.
Total revenues of $2,912.2 million surpassed the consensus mark of $2,907 million by 0.2%. The figure decreased 6.4% year over year due to lower contribution from its Underground Utility and Infrastructure Solutions segment.
Operating margin for the quarter rose 130 basis points or bps from a year ago to 6%. Adjusted EBITDA of $319.8 million also improved 21.9% from $262.3 million a year ago.
The company reported 12-month backlog of $8,266.6 million and total backlog of $15,132.4 million at December 2020-end. At September 2020-end, 12-month backlog came in at $8,143 million and total backlog was $15,071.6 million. Moreover, the said metrics increased from 2019-end respective figures of $7,947.1 million and $15,004.9 million.
Segment Details
At Dec 31, 2020, Quanta changed the name of Electric Power Infrastructure Services and Pipeline and Industrial Infrastructure Services segments to Electric Power Infrastructure Solutions and Underground Utility and Infrastructure Solutions, respectively. Nonetheless, there was no change in the composition of the segments.
The company reports results under two reportable segments: Electric Power Infrastructure Solutions segment (accounting for 69.4% of 2020 revenues), and Underground Utility and Infrastructure Solutions (30.6%).
Fourth-quarter revenues from Electric Power Infrastructure Services totaled $2,105.8 million, increasing 14% year over year. Operating margins expanded 290 bps to 11.6%. The segment’s 12-month backlog was $6,070.6 million, up from $5,356.6 million a year ago. Total backlog of $10,981.2 million also grew from $9,822.2 million reported in the prior-year quarter.
Within the Underground Utility and Infrastructure Solutions segment, revenues declined 36.3% from the prior-year quarter to $806.4 million. Operating margin of 5.1% also contracted 190 bps year over year. The segment’s 12-month backlog totaled $2,196 million, down from $2,590.5 million a year ago. Also, total backlog declined to $4,151.2 million from $5,182.7 million in the prior-year quarter.
2020 Highlights
Adjusted earnings came in at $3.82 per share, up from $3.33 in 2019. Total revenues were $11.2 billion, down from $12.1 billion in 2019. Operating margin of 5.5% improved 90 bps for 2020. Adjusted EBITDA also increased to $1.05 billion from $941.8 million in 2019.
Liquidity
As of Dec 31, 2020, Quanta had cash and cash equivalents of $184.6 million compared with $164.8 million at 2019-end. The company’s long-term debt (net of current maturities) amounted to $1,174.3 million, down from $1,292.2 million as of Dec 31, 2019.
Net cash provided by operating activities was $1,116 million for 2020 compared with $526.6 million in 2019. Free cash flow for 2020 came in at $891.9 million compared with $297.9 million reported in 2019.
Recent Achievements
During the fourth quarter, Quanta completed the acquisition of a business that primarily provides aviation services to the utility industry, principally in California. Additionally, it completed another acquisition of a company that provides heavy civil, industrial, and energy construction and maintenance services in the western United States.
Zacks Rank & Other Key Picks
Quanta currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other top-ranked stocks in the same space include Gates Industrial Corporation plc (GTES - Free Report) , AECOM (ACM - Free Report) and Mayville Engineering Company, Inc. (MEC - Free Report) . While Gates Industrial currently sports a Zacks Rank #1, AECOM and Mayville Engineering carry a Zacks Rank #2.
Gates Industrial’s 2021 earnings are expected to surge 61.4%.
AECOM’s fiscal 2021 earnings are expected to grow 24.7%.
Mayville’s 2021 earnings are expected to grow 238.3%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Click here for the 4 trades >>