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MasTec's (MTZ) Q4 Earnings Beat, Revenues Lag Estimates

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MasTec, Inc.’s (MTZ - Free Report) shares gained marginally by 0.3% in after-hours trading on Feb 24, after it reported mixed fourth-quarter 2021 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same. The company’s earnings surpassed the consensus mark for the 25th consecutive quarter.

Yet, MTZ guided for first-quarter 2022 loss owing to a normal seasonally slow quarter, project delays, project start-up costs and integration costs related to fourth-quarter buyouts.

Elaborating on the performance, Jose Mas, MasTec's CEO, said, “It is worth noting that following a year in which MasTec invested over $1.5 billion in acquisition activity, multiple agencies have granted MasTec an investment grade credit rating. MasTec continued to generate strong cash flow during 2021, and we enter 2022 with a strong balance sheet, ample liquidity and comfortable leverage metrics providing us the financial ability to take advantage of opportunities our markets afford us to maximize shareholder value."

MasTec, Inc. Price, Consensus and EPS Surprise

MasTec, Inc. Price, Consensus and EPS Surprise

MasTec, Inc. price-consensus-eps-surprise-chart | MasTec, Inc. Quote

Inside the Headlines

MasTec reported adjusted earnings of $1.35 per share, which surpassed the Zacks Consensus Estimate of $1.32 by 2.3%. The metric, however, dropped from $1.75 per share reported in the prior-year quarter.

Revenues of $1.81 billion missed the consensus mark of $1.86 billion by 2.8% but increased 10.5% year over year. At December 2021-end, the company had an 18-month backlog of $9.9 billion, up 26% year over year. It also grew 17% from the end of third-quarter 2021.

Segment Update

Revenues from Communications grew 20% year over year to $681.8 million. Adjusted EBITDA margin was up 10 basis points (bps) to 11.2%.

Clean Energy and Infrastructure’s revenues increased 48.9% year over year to $514.7 million. Adjusted EBITDA margin of 6.8% increased 360 bps from the year-ago figure.

Revenues from the Oil and Gas segment dropped 44.1% from the year-ago figure to $335.2 million. Adjusted EBITDA margin declined to 24.3% from 32.7% a year ago.

The Power Delivery (formerly known as Electrical Transmission) segment’s revenues came in at $285.4 million, up 126.9% from $125.8 million in the year-ago quarter. Adjusted EBITDA margin came in at 7.1%, up from 0.6% in the year-ago period.

Operational Update

The company reported an adjusted EBITDA of $219.3 million, down from $261.5 million in the prior-year period. Yet, adjusted EBITDA margin declined to 12.1% from 16% in the year-ago quarter.

Financial Details

As of Dec 31, 2021, MasTec had cash and cash equivalents of $360.7 million compared with $423.1 million in the corresponding year-ago period. In 2021, the company provided $793.1 million of cash from operating activities compared with $937.3 million a year ago.

2021 Highlights

Revenues were $7.95 billion, up from $6.32 billion in 2020. Adjusted earnings came in at $5.58 per share, up from $5.11 in 2020. Adjusted EBITDA was $931.3 million, up from $810 million in 2020. Adjusted EBITDA margin was 11.7% for 2021, down from 12.8% in 2020.

2022 Guidance

The company expects to generate record revenues of $9.95 billion in 2022, indicating an increase of 25% from a year ago. Adjusted EBITDA is expected to be $950 million. Adjusted EBITDA margin is expected to be 9.6%. Adjusted earnings are anticipated to be $5.32 per share. The estimated figure indicates a decrease from $5.58 reported in 2021. The Zacks Consensus Estimate for 2022 earnings is currently pegged at $5.41 per share.

First-Quarter 2022 View

MasTec expects first-quarter revenues of $1.8 billion. Adjusted EBITDA is estimated to be $90 million. Adjusted EBITDA margin is expected to be 5%. The company expects to incur an adjusted loss per share of 12 cents for the quarter, considering a normal seasonally slow quarter, project delays, project start-up costs and integration costs related to fourth-quarter acquisitions.

Zacks Rank & Peer Releases

MasTec currently carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Quanta Services Inc. (PWR - Free Report) reported impressive earnings for fourth-quarter 2021. Adjusted earnings and revenues not only surpassed the Zacks Consensus Estimate but also grew impressively on a year-over-year basis.

PWR’s earnings beat the consensus mark for the seventh straight quarter, whereas revenues surpassed the same in four out of seven consecutive quarters.

Fluor Corporation (FLR - Free Report) reported mixed fourth-quarter 2021 results, wherein earnings beat the Zacks Consensus Estimate but revenues lagged the same. Earnings beat the Zacks Consensus Estimate for the fourth straight quarter, whereas revenues missed the same for the sixth consecutive quarter.

Fluor's total new awards for 2021 came in at $8.8 billion compared with $9 billion in 2020. Consolidated backlog for the year came in at $18.9 billion, down from $25.6 billion in 2020.

UFP Industries, Inc. (UFPI - Free Report) reported fourth-quarter 2021 results, wherein earnings and net sales beat the Zacks Consensus Estimate as well as improved impressively on a year-over-year basis.

With this, UFPI’s earnings and sales surpassed the consensus mark in the trailing four quarters. The uptrend was mainly driven by the diversity of markets and an improved pricing model.

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