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Quanta (PWR) Beats on Q2 Earnings, Ups 2022 Revenue View
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Quanta Services Inc. (PWR - Free Report) reported impressive results for second-quarter 2022. Adjusted earnings and revenues surpassed the Zacks Consensus Estimate and increased impressively on a year-over-year basis reflecting the benefits of portfolio strategy, and strategic capital deployment.
Notably, earnings beat the consensus mark in the trailing nine quarters, whereas revenues surpassed the same in six out of nine consecutive quarters.
The stock has moved down 2.2% in the pre-market trading session on Aug 4, post its earnings release.
Duke Austin, president and CEO of Quanta, stated, “Notably, we are seeing growing demand for our renewable generation and infrastructure solutions in 2023 and beyond, giving us continued confidence in our multi-year financial targets.”
Detailed Discussion
Quanta’s adjusted earnings of $1.54 per share surpassed the consensus estimate of $1.51 by 2% and increased 45.2% from the year-ago quarter’s $1.06. The upside was backed by revenue growth across the segments, record total backlog and solid and safe project execution.
Quanta Services, Inc. Price, Consensus and EPS Surprise
Total revenues of $4.23 billion also surpassed the consensus mark of $4.02 billion by 5.3% and increased 41.1% year over year.
The operating margin for the quarter fell 50 basis points (bps) to 4.9% from a year-ago figure of 5.4%. Adjusted EBITDA of $422.1 million improved 50% from $281.3 million in the year-ago quarter.
The company reported a 12-month backlog of $11.58 billion and a total backlog of $19.85 billion at June-end. At December 2021-end, the 12-month backlog came in at $11.31 billion, and the total backlog was $19.27 billion. The reported metrics were also up from second-quarter 2021 end respective figures of $8.98 billion and $16.98 billion.
Segment Details
It reports results under three reportable segments: Electric Power Infrastructure Solutions segment, Renewable Energy Infrastructure Solutions and Underground Utility and Infrastructure Solutions.
Revenues from Electric Power Infrastructure Solutions totaled $2.2 billion, increasing 21.1% year over year. The operating margin contracted 80 bps to 10.6%. The segment’s 12-month backlog was $6.38 billion, up from $5.56 billion a year ago. The total backlog of $11.72 billion increased from $11.29 billion reported in the prior-year quarter.
Revenues from Renewable Energy Infrastructure Solutions totaled $924.2 million, up 178.4% year over year. Operating margins contracted 20 bps to 8.8%. The segment’s 12-month backlog was $2.35 billion, up from $942 million a year ago. The total backlog of $3 billion increased from $1.35 billion reported in the year-ago period.
Within the Underground Utility and Infrastructure Solutions segment, revenues rose 30.1% from the prior-year quarter’s levels to $1.11 billion. The operating margin of 8.1% was up 530 bps from 2.8% reported in the prior-year quarter. Segment’s 12-month backlog totaled $2.84 billion, up from $2.47 billion a year ago. The total backlog increased to $5.12 billion from $4.34 billion in the prior-year quarter.
Liquidity
As of Jun 30, 2022, Quanta had cash and cash equivalents of $150.7 million, down from $229.1 million at the 2021-end. The company’s long-term debt (net of current maturities) amounted to $3.87 billion, up from $3.72 billion as of Dec 31, 2021.
Net cash provided by operating activities was $118.7 million in the second quarter, down from $188.9 million a year ago. Free cash flow for the second quarter came in at $13.5 million versus $125.8 million reported in the year-ago period.
2022 Guidance Updated
Quanta now expects revenues between $16.6 billion and $17.0 billion versus the prior projection of $16.2-16.7 billion. The Zacks Consensus Estimate for the said metric is currently pegged at $16.47 billion.
It still expects adjusted (non-GAAP) earnings between $6.10 and $6.44 versus $6.00-$6.50 expected earlier. The Zacks Consensus Estimate is currently pegged at $6.30 per share.
Adjusted EBITDA is now projected within $1.64-$1.71 billion versus $1.60-$1.71 billion expected earlier. Quanta’s full-year non-GAAP free cash flow projection is pegged at $550-$750 million.
EMCOR Group, Inc. (EME - Free Report) reported solid results for second-quarter 2022. The top and bottom lines surpassed the Zacks Consensus Estimate and increased year over year.
EME’s management approved a 15.4% hike in its regular quarterly dividend to 15 cents, payable on Oct 31 to stockholders of record as of Oct 18, 2022. Also, it authorized a new share repurchase program to repurchase up to an additional $500 million of its outstanding common stock.
United Rentals, Inc. (URI - Free Report) posted better-than-expected second-quarter 2022 results. Better fleet productivity on broad-based rental demand in construction and industrial verticals, higher total and rental revenues along with stronger pricing helped the company to boost profit.
URI also lifted its full-year guidance for total revenues, adjusted EBITDA and free cash flow, given broad-based end-market activity, contractor backlogs, customer sentiment and our visibility through the balance of the year.
Martin Marietta Materials, Inc. (MLM - Free Report) reported impressive second-quarter 2022 results. Earnings and revenues surpassed the Zacks Consensus Estimate and increased on a year-over-year basis, backed by improved pricing across businesses and higher demand.
Despite increased inflationary pressure from rising input costs and a challenging macroeconomic and geopolitical environment, solid execution of its strategic business plan and resilient aggregates-led business drove the result.
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Quanta (PWR) Beats on Q2 Earnings, Ups 2022 Revenue View
Quanta Services Inc. (PWR - Free Report) reported impressive results for second-quarter 2022. Adjusted earnings and revenues surpassed the Zacks Consensus Estimate and increased impressively on a year-over-year basis reflecting the benefits of portfolio strategy, and strategic capital deployment.
Notably, earnings beat the consensus mark in the trailing nine quarters, whereas revenues surpassed the same in six out of nine consecutive quarters.
The stock has moved down 2.2% in the pre-market trading session on Aug 4, post its earnings release.
Duke Austin, president and CEO of Quanta, stated, “Notably, we are seeing growing demand for our renewable generation and infrastructure solutions in 2023 and beyond, giving us continued confidence in our multi-year financial targets.”
Detailed Discussion
Quanta’s adjusted earnings of $1.54 per share surpassed the consensus estimate of $1.51 by 2% and increased 45.2% from the year-ago quarter’s $1.06. The upside was backed by revenue growth across the segments, record total backlog and solid and safe project execution.
Quanta Services, Inc. Price, Consensus and EPS Surprise
Quanta Services, Inc. price-consensus-eps-surprise-chart | Quanta Services, Inc. Quote
Total revenues of $4.23 billion also surpassed the consensus mark of $4.02 billion by 5.3% and increased 41.1% year over year.
The operating margin for the quarter fell 50 basis points (bps) to 4.9% from a year-ago figure of 5.4%. Adjusted EBITDA of $422.1 million improved 50% from $281.3 million in the year-ago quarter.
The company reported a 12-month backlog of $11.58 billion and a total backlog of $19.85 billion at June-end. At December 2021-end, the 12-month backlog came in at $11.31 billion, and the total backlog was $19.27 billion. The reported metrics were also up from second-quarter 2021 end respective figures of $8.98 billion and $16.98 billion.
Segment Details
It reports results under three reportable segments: Electric Power Infrastructure Solutions segment, Renewable Energy Infrastructure Solutions and Underground Utility and Infrastructure Solutions.
Revenues from Electric Power Infrastructure Solutions totaled $2.2 billion, increasing 21.1% year over year. The operating margin contracted 80 bps to 10.6%. The segment’s 12-month backlog was $6.38 billion, up from $5.56 billion a year ago. The total backlog of $11.72 billion increased from $11.29 billion reported in the prior-year quarter.
Revenues from Renewable Energy Infrastructure Solutions totaled $924.2 million, up 178.4% year over year. Operating margins contracted 20 bps to 8.8%. The segment’s 12-month backlog was $2.35 billion, up from $942 million a year ago. The total backlog of $3 billion increased from $1.35 billion reported in the year-ago period.
Within the Underground Utility and Infrastructure Solutions segment, revenues rose 30.1% from the prior-year quarter’s levels to $1.11 billion. The operating margin of 8.1% was up 530 bps from 2.8% reported in the prior-year quarter. Segment’s 12-month backlog totaled $2.84 billion, up from $2.47 billion a year ago. The total backlog increased to $5.12 billion from $4.34 billion in the prior-year quarter.
Liquidity
As of Jun 30, 2022, Quanta had cash and cash equivalents of $150.7 million, down from $229.1 million at the 2021-end. The company’s long-term debt (net of current maturities) amounted to $3.87 billion, up from $3.72 billion as of Dec 31, 2021.
Net cash provided by operating activities was $118.7 million in the second quarter, down from $188.9 million a year ago. Free cash flow for the second quarter came in at $13.5 million versus $125.8 million reported in the year-ago period.
2022 Guidance Updated
Quanta now expects revenues between $16.6 billion and $17.0 billion versus the prior projection of $16.2-16.7 billion. The Zacks Consensus Estimate for the said metric is currently pegged at $16.47 billion.
It still expects adjusted (non-GAAP) earnings between $6.10 and $6.44 versus $6.00-$6.50 expected earlier. The Zacks Consensus Estimate is currently pegged at $6.30 per share.
Adjusted EBITDA is now projected within $1.64-$1.71 billion versus $1.60-$1.71 billion expected earlier. Quanta’s full-year non-GAAP free cash flow projection is pegged at $550-$750 million.
Zacks Rank & Some Recent Construction Releases
Quanta 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 solid results for second-quarter 2022. The top and bottom lines surpassed the Zacks Consensus Estimate and increased year over year.
EME’s management approved a 15.4% hike in its regular quarterly dividend to 15 cents, payable on Oct 31 to stockholders of record as of Oct 18, 2022. Also, it authorized a new share repurchase program to repurchase up to an additional $500 million of its outstanding common stock.
United Rentals, Inc. (URI - Free Report) posted better-than-expected second-quarter 2022 results. Better fleet productivity on broad-based rental demand in construction and industrial verticals, higher total and rental revenues along with stronger pricing helped the company to boost profit.
URI also lifted its full-year guidance for total revenues, adjusted EBITDA and free cash flow, given broad-based end-market activity, contractor backlogs, customer sentiment and our visibility through the balance of the year.
Martin Marietta Materials, Inc. (MLM - Free Report) reported impressive second-quarter 2022 results. Earnings and revenues surpassed the Zacks Consensus Estimate and increased on a year-over-year basis, backed by improved pricing across businesses and higher demand.
Despite increased inflationary pressure from rising input costs and a challenging macroeconomic and geopolitical environment, solid execution of its strategic business plan and resilient aggregates-led business drove the result.