We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Timing Volatility, High Cost to Ail Dycom's (DY) Q1 Earnings
Read MoreHide Full Article
Dycom Industries, Inc. (DY - Free Report) is slated to report first-quarter fiscal 2020 results on May 21, before the opening bell. In the last reported quarter, the company’s earnings lagged the Zacks Consensus Estimate by 41.2% and declined 16.7% from the prior-year period. The bottom-line results were mainly impacted by tighter-than-expected margins owing to difficulties in large account.
Nonetheless, its total contract revenues of $748.6 million increased 14.3% year over year and topped the consensus mark by 4%. Organic revenues also increased 13.7% year over year during the quarter, backed by deployment of 1-gigabit wireline networks, wireless/wireline converged networks and wireless networks.
Shares of this specialty contracting services provider, which shares space in the Building Products - Heavy Construction industry with EMCOR Group, Inc. (EME - Free Report) , MasTec, Inc. (MTZ - Free Report) and North American Construction Group Ltd. (NOA - Free Report) , have underperformed the industry year to date. The stock has lost 13.6% against its industry’s growth of 13.7% in the said period.
Let’s See How Things are Shaping Up for This Announcement
Dycom’s fiscal first-quarter results are expected to be negatively impacted by timing volatility due to large customer programs, customer spending modulations, and under absorption of labor and field costs. Also, bankruptcy of the company’s fifth largest customer is likely to weigh on overall results in the to-be-reported quarter.
Despite reporting solid contract revenues, the company has been vulnerable to timing uncertainty post initiation of large-scale network deployments. The trend is likely to continue in the fiscal first quarter as well. For the to-be-reported quarter, Dycom anticipates adjusted earnings within 34-56 cents per share, well below the year-ago level of 65 cents.
Notably, the Zacks Consensus Estimate for the to-be-reported quarter’s earnings is pegged at 43 cents, indicating a decline of 33.9% from the comparable period of fiscal 2019.
The company is experiencing increased costs associated with the introduction of new initiatives and accelerated complexity of the above-mentioned programs. The same is expected to hurt its adjusted EBITDA margin in the quarter to be reported, as the company already projects the said metric to be lower than the year-ago level.
Meanwhile, the company has been immensely benefiting from extensive deployment of 1-gigabit wireline networks by major customers. The same is expected to benefit fiscal first-quarter earnings as well. Its strong financial position and diligent operational execution allow it to undertake strategic initiatives for expanding market share. Resultantly, the company’s top-line growth will get a boost.
Dycom has a solid track record of booking new contracts and renewing the existing ones. The company’s string of contract wins and strong customer relationships act as major growth drivers. It anticipates contract revenues in the range of $750-$800 million, up from $731.4 million recorded in the prior-year quarter.
Markedly, the Zacks Consensus Estimate for revenues is pegged at $770.6 million, suggesting a 5.4% increase from the prior-year figure of $731.4 million.
What the Zacks Model Says
Our proven model does not conclusively show that Dycom is likely to beat estimates in the to-be-reported quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Dycom currently carries a Zacks Rank #3.
Meanwhile, we caution against stocks with a Zacks Rank #4 and 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
This Could Be the Fastest Way to Grow Wealth in 2019
Research indicates one sector is poised to deliver a crop of the best-performing stocks you'll find anywhere in the market. Breaking news in this space frequently creates quick double- and triple-digit profit opportunities.
These companies are changing the world – and owning their stocks could transform your portfolio in 2019 and beyond. Recent trades from this sector have generated +98%, +119% and +164% gains in as little as 1 month.
Image: Bigstock
Timing Volatility, High Cost to Ail Dycom's (DY) Q1 Earnings
Dycom Industries, Inc. (DY - Free Report) is slated to report first-quarter fiscal 2020 results on May 21, before the opening bell. In the last reported quarter, the company’s earnings lagged the Zacks Consensus Estimate by 41.2% and declined 16.7% from the prior-year period. The bottom-line results were mainly impacted by tighter-than-expected margins owing to difficulties in large account.
.jpg)
Nonetheless, its total contract revenues of $748.6 million increased 14.3% year over year and topped the consensus mark by 4%. Organic revenues also increased 13.7% year over year during the quarter, backed by deployment of 1-gigabit wireline networks, wireless/wireline converged networks and wireless networks.
Shares of this specialty contracting services provider, which shares space in the Building Products - Heavy Construction industry with EMCOR Group, Inc. (EME - Free Report) , MasTec, Inc. (MTZ - Free Report) and North American Construction Group Ltd. (NOA - Free Report) , have underperformed the industry year to date. The stock has lost 13.6% against its industry’s growth of 13.7% in the said period.
Let’s See How Things are Shaping Up for This Announcement
Dycom’s fiscal first-quarter results are expected to be negatively impacted by timing volatility due to large customer programs, customer spending modulations, and under absorption of labor and field costs. Also, bankruptcy of the company’s fifth largest customer is likely to weigh on overall results in the to-be-reported quarter.
Despite reporting solid contract revenues, the company has been vulnerable to timing uncertainty post initiation of large-scale network deployments. The trend is likely to continue in the fiscal first quarter as well. For the to-be-reported quarter, Dycom anticipates adjusted earnings within 34-56 cents per share, well below the year-ago level of 65 cents.
Notably, the Zacks Consensus Estimate for the to-be-reported quarter’s earnings is pegged at 43 cents, indicating a decline of 33.9% from the comparable period of fiscal 2019.
Dycom Industries, Inc. Price and EPS Surprise
Dycom Industries, Inc. price-eps-surprise | Dycom Industries, Inc. Quote
The company is experiencing increased costs associated with the introduction of new initiatives and accelerated complexity of the above-mentioned programs. The same is expected to hurt its adjusted EBITDA margin in the quarter to be reported, as the company already projects the said metric to be lower than the year-ago level.
Meanwhile, the company has been immensely benefiting from extensive deployment of 1-gigabit wireline networks by major customers. The same is expected to benefit fiscal first-quarter earnings as well. Its strong financial position and diligent operational execution allow it to undertake strategic initiatives for expanding market share. Resultantly, the company’s top-line growth will get a boost.
Dycom has a solid track record of booking new contracts and renewing the existing ones. The company’s string of contract wins and strong customer relationships act as major growth drivers. It anticipates contract revenues in the range of $750-$800 million, up from $731.4 million recorded in the prior-year quarter.
Markedly, the Zacks Consensus Estimate for revenues is pegged at $770.6 million, suggesting a 5.4% increase from the prior-year figure of $731.4 million.
What the Zacks Model Says
Our proven model does not conclusively show that Dycom is likely to beat estimates in the to-be-reported quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Dycom currently carries a Zacks Rank #3.
Meanwhile, we caution against stocks with a Zacks Rank #4 and 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
You can see the complete list of today’s Zacks #1 Rank stocks here.
This Could Be the Fastest Way to Grow Wealth in 2019
Research indicates one sector is poised to deliver a crop of the best-performing stocks you'll find anywhere in the market. Breaking news in this space frequently creates quick double- and triple-digit profit opportunities.
These companies are changing the world – and owning their stocks could transform your portfolio in 2019 and beyond. Recent trades from this sector have generated +98%, +119% and +164% gains in as little as 1 month.
Click here to see these breakthrough stocks now >>