Dycom Industries, Inc. ( DY Quick Quote DY - Free Report) has been gaining from higher demand arising from broad constructions or enhancement of significant wireline networks across broad sections of the country, to provide gigabit network speeds to individual consumers and businesses either directly or through a wireless mode using 5G technologies. However, the automotive and equipment supply chain remain challenging, particularly for the large truck chassis required for specialty equipment. Prices of capital equipment are increasing. Although macroeconomic effects and supply constraints might influence the near-term execution of some customer plans, shares of Dycom have been gaining from the industry tailwinds. This Palm Beach Gardens, FL-based specialty contracting service provider’s shares have risen 29.4% in the past year, outperforming the Zacks Building Products - Heavy Construction industry’s 18.5% decline. Image Source: Zacks Investment Research The fiscal 2023 earnings estimates for this Zacks Rank #3 (Hold) company have moved 10% upward over the past 60 days. This positive trend signifies bullish analysts’ sentiments, indicating robust fundamentals and the expectation of outperformance in the near term. You can see . the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here Holding DY stock will not disappoint investors as it possesses solid VGM Score of A, along with a strong earnings growth rate. Let’s delve deeper into the major driving factors. Deployment of 1-Gigabit Wireline Networks: Dycom has been benefiting immensely from the extensive deployment of 1-gigabit wireline networks by major customers. In fact, six of its top 10 customers have announced substantial new plans for deployments of fiber-to-the-home. Dycom remains optimistic about the strengthening industry environment, given strong end-market drivers. Although the recent market trend is a concern for the company, it believes telecommunication networks, which are crucial infrastructure for the country, will gain momentum post pandemic. In first-quarter fiscal 2023, contract revenues of $876.3 million moved up 20.5% year over year and increased 21.1% on an organic basis (after adjusting for storm restoration services revenues). Its top five customers contributed 67.3% to total contract revenues, which rose 19.8% organically. Revenues from all other customers increased 23.9% organically in the quarter. This marks the 13th consecutive quarter, wherein all other customers of DY, in aggregate, excluding the top five customers, have grown organically. Solid Backlog Level: Backlog activity during the fiscal first quarter reflects solid performance as it booked new work and renewed existing work. Dycom expects considerable opportunities across a broad array of customers. Dycom’s backlog was $5.593 billion at first-quarter fiscal 2023 end. Over the last few years, Dycom has successfully increased the long-term value of its maintenance business, which is expected to complement its deployment of 1-gigabit and wireless-wireline converged-networks. Higher Earnings Growth Rate: Earnings growth is also a key factor in stock valuation. The Zacks Consensus Estimate for fiscal 2023 earnings of $3.29 per share indicates 116.5% year-over-year growth. The solid growth rate depicts the stock's promising future. Some Better-Ranked Stocks in the Construction Sector KBR, Inc. ( KBR Quick Quote KBR - Free Report) , currently carrying a Zacks Rank #2 (Buy), provides professional services and technologies, across the asset and program life cycle within government services and hydrocarbons industries, worldwide. Its mission-critical government services, high-end and differentiated government business work, strong margin performance, proprietary technology solutions and a significant increase in backlog (particularly in Government Solution) are expected to boost 2022 earnings. KBR’s 2022 earnings are likely to rise 7.9%. The company has seen a 0.4% upward estimate revision for 2022 earnings in the past 60 days. AECOM ( ACM Quick Quote ACM - Free Report) , currently carrying a Zacks Rank #2, is a leading solutions provider for supporting professional, technical and management solutions for diverse industries across end markets like transportation, facilities, government and those in environmental, energy and water businesses. AECOM’s expected earnings growth rate for 2022 is 21.6%. The consensus mark for its 2022 earnings has moved up to $3.43 per share from $3.40, in the past 60 days. Meritage Homes Corporation ( MTH Quick Quote MTH - Free Report) , a Zacks Rank #2 company, is one of the leading designers and builders of single-family homes. MTH’s earnings are expected to grow 42.7% in 2022. Earnings estimates have moved 1.4% north for 2022 over the past 60 days.