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Here's How Much You'd Have If You Invested $1000 in Quanta Services a Decade Ago

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For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.

FOMO, or the fear of missing out, also plays a role in investing, particularly with tech giants and popular consumer-facing stocks.

What if you'd invested in Quanta Services (PWR - Free Report) ten years ago? It may not have been easy to hold on to PWR for all that time, but if you did, how much would your investment be worth today?

Quanta Services' Business In-Depth

With that in mind, let's take a look at Quanta Services' main business drivers.

Quanta Services is a leading national provider of specialty contracting services, and one of the largest contractors serving the transmission and distribution sector of the North American electric utility industry.  Quanta Services has operations in United States, Canada, Australia and other selected international markets.

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 Electric Power Infrastructure Solutions segment (accounting for 69.4% of 2020 revenues) provides comprehensive network solutions to customers in the electric power industry. Services performed include the design, installation, upgrade, repair and maintenance of electric power transmission and distribution networks, and sub-station facilities; emergency restoration services; installation of “smart grid” technology on electric power networks; supports the development of renewable energy generation, including solar, wind, hydro power and backup natural gas generation facilities, and related switchyards and transmission infrastructure; and communications infrastructure services.

The Underground Utility and Infrastructure Solutions segment (30.6%) provides comprehensive network solutions to customers involved in the transportation of natural gas, oil and other pipeline products. Services include the design, installation, repair and maintenance of oil and gas transmission and distribution systems and related trenching and directional boring services. Also, this segment provides pipeline protection services, integrity testing, rehabilitation and replacement, and the fabrication of pipeline support systems and related structures and facilities for natural gas utilities and midstream companies. It also provides high-pressure and critical-path turnaround services to the downstream and midstream energy markets and instrumentation and electrical services, piping, fabrication and storage tank services.

Bottom Line

Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Quanta Services ten years ago, you're likely feeling pretty good about your investment today.

According to our calculations, a $1000 investment made in August 2011 would be worth $5,606.51, or a 460.65% gain, as of August 27, 2021. Investors should keep in mind that this return excludes dividends but includes price appreciation.

Compare this to the S&P 500's rally of 279.84% and gold's return of -5.52% over the same time frame.

Going forward, analysts are expecting more upside for PWR.

Quanta Services reported second-quarter 2021 results, wherein adjusted earnings and revenues not only surpassed the Zacks Consensus Estimate but also grew 43.2% and 19.7% year over year, respectively, courtesy of solid performance of the Electric Power Infrastructure Solutions segment. The upside was backed by continued strength of the electric power unit, which reported record revenues and better-than-expected margins. Also, rising renewable generation development and associated demand bode well for the company. Also, raised view for 2021 is encouraging. Worryingly, it is generating lower revenues from larger pipeline projects. Its industrial operations and non-U.S. markets within the utility unit continue to remain under pressure owing to COVID-19 dynamics, thereby impacting core quarter revenues and margins.

Shares have gained 11.09% over the past four weeks and there have been 4 higher earnings estimate revisions for fiscal 2021 compared to none lower. The consensus estimate has moved up as well.

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