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.
Dycom's (DY) Stock Increases on Q4 Earnings Beat, Margins Fall
Read MoreHide Full Article
Dycom Industries Inc. (DY - Free Report) reported stellar results in fourth-quarter fiscal 2022 (ended Jan 29, 2022). Quarterly earnings and revenues surpassed the respective Zacks Consensus Estimate and increased on a year-over-year basis. The upside was mainly backed by solid organic growth and storm restoration services.
Shares of the company rallied nearly 7.7% on Mar 2, post the earnings release.
Major industry players have been constructing or upgrading significant wireline networks across broad sections of the country to provision 1 gigabit network speeds to consumers, either directly or wirelessly using 5G technologies, which is broadening the industry as well as Dycom’s opportunities.
Earnings & Revenue Discussion
Dycom reported adjusted earnings of 2 cents per share, surpassing the Zacks Consensus Estimate and the year-ago quarter’s figure of negative 7 cents by a whopping 128.6%.
Dycom Industries, Inc. Price, Consensus and EPS Surprise
Contract revenues of $761.5 million moved up 1.4% year over year and beat the consensus mark by 6.1%. Contract revenues increased 10.1% on an organic basis (after adjusting for storm restoration services revenues and an additional week of operations in the prior-year period). The same from storm restoration services were $5.7 million in the quarter.
Its top five customers contributed 66.6% to total contract revenues, which rose 5.4% organically. Revenues from all other customers increased 20.8% organically in the quarter. The quarter marks the 12th consecutive quarter wherein DY’s all other customers in aggregate, excluding the top five customers, have grown organically.
Dycom’s largest customer AT&T (contributing 26.6% to total revenues) advanced 73.6% on an organic basis. This marked its fourth consecutive quarter of organic growth. Comcast (the second-largest customer) contributed 13.1% to total revenues, Lumen Technologies accounted for 11.7% and Verizon and Frontier represented 10.1% and 5.1% of total revenues, respectively. Frontier rose 97.2% organically. Fiber construction revenues from electric utilities increased 37.2% year over year, organically, and contributed 7.5% to total contract revenues.
Dycom’s backlog at the end of the fiscal fourth quarter totaled $5.822 billion compared with $6.810 billion at fiscal 2021-end. Of the backlog, $3.072 billion is projected to be completed in the next 12 months.
Operating Highlights
The gross margin in the quarter was 13.8%, down 50 basis points (bps) from the year-ago quarter level due to significantly higher COVID-related absences and adverse winter weather conditions. Adjusted EBITDA margin of 5.7% contracted 40 bps from the year-ago level.
Fiscal 2022 Highlights
The company reported total contract revenues of $3.13 billion, down 2.1% from $3.2 billion in fiscal 2021, primarily due to 0.2% organic revenues fall (after adjusting for storm restoration services revenues and an additional week of operations during fiscal 2021). Contract revenues from storm restoration services were $3.9 million, down from $14.6 million a year ago.
Adjusted EBITDA margin was 7.8%, 190 bps down from 9.7% in fiscal 2021. Adjusted earnings per share were $1.52 compared with $2.54 in fiscal 2021.
Financials
As of Jan 29, 2022, Dycom had cash and cash equivalents worth $310.8 million compared with $11.8 million on Jan 30, 2021. Long-term debt was $823.3 million at the end of fourth-quarter fiscal 2022 compared with $501.6 million at fiscal 2021-end.
During the reported quarter, DY repurchased 600,000 shares for $56.1 million at an average price of $93.55 per share.
Fiscal Q1 FY’23 View
For the fiscal first quarter (ended Apr 30, 2022), it expects contract revenues to grow in mid-to-high single digit year over year. The adjusted EBITDA margin is expected to increase modestly from the year-ago levels.
EMCOR Group Inc. (EME - Free Report) reported mixed results for fourth-quarter 2021. Adjusted earnings lagged the Zacks Consensus Estimate, but revenues surpassed the same. Both the metrics improved on a year-over-year basis, thanks to robust demand for its services.
EMCOR currently carries a Zacks Rank #2 (Buy). EME has gained 15.9% in the past year against a 6.8% fall of the Zacks Building Products - Heavy Construction industry it belongs to.
MasTec, Inc. (MTZ - Free Report) reported mixed fourth-quarter 2021 results, with earnings surpassing the Zacks Consensus Estimate and revenues missing the same. The company’s earnings surpassed the consensus mark for the 25th consecutive quarter.
First-quarter 2022, MTZ guided a loss owing to a normal seasonally slow quarter, project delays, project start-up costs and integration costs related to fourth-quarter buyouts. MasTec currently carries a Zacks Rank #3.
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 surged on a year-over-year basis. Earnings beat the consensus mark for the seventh straight quarter, whereas revenues surpassed the same in four out of seven consecutive quarters.
Quanta Services currently carries a Zacks Rank #3. PWR has gained 34.7% in the past year.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Dycom's (DY) Stock Increases on Q4 Earnings Beat, Margins Fall
Dycom Industries Inc. (DY - Free Report) reported stellar results in fourth-quarter fiscal 2022 (ended Jan 29, 2022). Quarterly earnings and revenues surpassed the respective Zacks Consensus Estimate and increased on a year-over-year basis. The upside was mainly backed by solid organic growth and storm restoration services.
Shares of the company rallied nearly 7.7% on Mar 2, post the earnings release.
Major industry players have been constructing or upgrading significant wireline networks across broad sections of the country to provision 1 gigabit network speeds to consumers, either directly or wirelessly using 5G technologies, which is broadening the industry as well as Dycom’s opportunities.
Earnings & Revenue Discussion
Dycom reported adjusted earnings of 2 cents per share, surpassing the Zacks Consensus Estimate and the year-ago quarter’s figure of negative 7 cents by a whopping 128.6%.
Dycom Industries, Inc. Price, Consensus and EPS Surprise
Dycom Industries, Inc. price-consensus-eps-surprise-chart | Dycom Industries, Inc. Quote
Contract revenues of $761.5 million moved up 1.4% year over year and beat the consensus mark by 6.1%. Contract revenues increased 10.1% on an organic basis (after adjusting for storm restoration services revenues and an additional week of operations in the prior-year period). The same from storm restoration services were $5.7 million in the quarter.
Its top five customers contributed 66.6% to total contract revenues, which rose 5.4% organically. Revenues from all other customers increased 20.8% organically in the quarter. The quarter marks the 12th consecutive quarter wherein DY’s all other customers in aggregate, excluding the top five customers, have grown organically.
Dycom’s largest customer AT&T (contributing 26.6% to total revenues) advanced 73.6% on an organic basis. This marked its fourth consecutive quarter of organic growth. Comcast (the second-largest customer) contributed 13.1% to total revenues, Lumen Technologies accounted for 11.7% and Verizon and Frontier represented 10.1% and 5.1% of total revenues, respectively. Frontier rose 97.2% organically. Fiber construction revenues from electric utilities increased 37.2% year over year, organically, and contributed 7.5% to total contract revenues.
Dycom’s backlog at the end of the fiscal fourth quarter totaled $5.822 billion compared with $6.810 billion at fiscal 2021-end. Of the backlog, $3.072 billion is projected to be completed in the next 12 months.
Operating Highlights
The gross margin in the quarter was 13.8%, down 50 basis points (bps) from the year-ago quarter level due to significantly higher COVID-related absences and adverse winter weather conditions. Adjusted EBITDA margin of 5.7% contracted 40 bps from the year-ago level.
Fiscal 2022 Highlights
The company reported total contract revenues of $3.13 billion, down 2.1% from $3.2 billion in fiscal 2021, primarily due to 0.2% organic revenues fall (after adjusting for storm restoration services revenues and an additional week of operations during fiscal 2021). Contract revenues from storm restoration services were $3.9 million, down from $14.6 million a year ago.
Adjusted EBITDA margin was 7.8%, 190 bps down from 9.7% in fiscal 2021. Adjusted earnings per share were $1.52 compared with $2.54 in fiscal 2021.
Financials
As of Jan 29, 2022, Dycom had cash and cash equivalents worth $310.8 million compared with $11.8 million on Jan 30, 2021. Long-term debt was $823.3 million at the end of fourth-quarter fiscal 2022 compared with $501.6 million at fiscal 2021-end.
During the reported quarter, DY repurchased 600,000 shares for $56.1 million at an average price of $93.55 per share.
Fiscal Q1 FY’23 View
For the fiscal first quarter (ended Apr 30, 2022), it expects contract revenues to grow in mid-to-high single digit year over year. The adjusted EBITDA margin is expected to increase modestly from the year-ago levels.
Zacks Rank & Recent Releases
Dycom currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
EMCOR Group Inc. (EME - Free Report) reported mixed results for fourth-quarter 2021. Adjusted earnings lagged the Zacks Consensus Estimate, but revenues surpassed the same. Both the metrics improved on a year-over-year basis, thanks to robust demand for its services.
EMCOR currently carries a Zacks Rank #2 (Buy). EME has gained 15.9% in the past year against a 6.8% fall of the Zacks Building Products - Heavy Construction industry it belongs to.
MasTec, Inc. (MTZ - Free Report) reported mixed fourth-quarter 2021 results, with earnings surpassing the Zacks Consensus Estimate and revenues missing the same. The company’s earnings surpassed the consensus mark for the 25th consecutive quarter.
First-quarter 2022, MTZ guided a loss owing to a normal seasonally slow quarter, project delays, project start-up costs and integration costs related to fourth-quarter buyouts. MasTec currently carries a Zacks Rank #3.
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 surged on a year-over-year basis. Earnings beat the consensus mark for the seventh straight quarter, whereas revenues surpassed the same in four out of seven consecutive quarters.
Quanta Services currently carries a Zacks Rank #3. PWR has gained 34.7% in the past year.