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MasTec, Inc. (MTZ - Free Report) reported impressive results for fourth-quarter 2022, where earnings and revenues beat the Zacks Consensus Estimate. Earnings declined year over year, but revenues increased on accretive acquisitions and solid improvement across the segments (barring Oil and Gas).
MTZ’s shares fell 2.08% in the after-hours trading session on Feb 23. The tepid bottom line guidance for first-quarter 2023 might have hurt investors’ sentiment.
Jose Mas, MasTec's CEO, said, "As we end 2022, it is important to note the significant end market transformation we have undertaken over the past two years to support the nation's energy transition to sustainable renewable energy sources. In 2020, MasTec recorded $6.3 billion in revenue, and we currently expect to more than double that level and approximate $13 billion in revenue in 2023. We believe that acquisition activity over the last two years has greatly enhanced our scale, expertise and market positioning to meet expected high customer demand growth for renewable power generation, power grid transmission and distribution and civil infrastructure over the next decade. We believe that this opportunity, coupled with continued expected growth in telecommunications infrastructure and expanding demand for traditional and new green pipeline services, positions us with multiple strong long term growth opportunities."
Inside the Headlines
Adjusted earnings of $1.03 per share beat the Zacks Consensus Estimate of 99 cents by 4% but declined 23.7% from $1.35 reported in the year-ago period.
Revenues of $3 billion also topped the consensus mark of $2.92 billion by 3.1% and increased 66.3% from $1.8 billion a year ago.
At December 2022-end, the company had an 18-month backlog of $12.98 billion, up 13% from $9.94 billion a year ago and 16% from $11.23 billion sequentially.
Segment Update
Revenues from Communications grew 25.9% year over year to $858.6 million. Adjusted EBITDA margin was down 10 basis points (bps) to 11.1%.
Clean Energy and Infrastructure’s revenues increased a whopping 118.6% year over year to $1,125 million. Adjusted EBITDA margin was 7%, up 20 bps from 6.8% in the year-ago quarter.
Revenues from the Oil and Gas segment dropped 13% from the year-ago figure to $291.6 million. Adjusted EBITDA margin declined to 11.5% from 24.3% a year ago.
The Power Delivery (formerly known as Electrical Transmission) segment’s revenues came in at $739.8 million, up 159.2% from the year-ago quarter. Adjusted EBITDA margin came in at 7.7%, up 60 bps from the year-ago period.
Operational Update
The company reported adjusted EBITDA of $257.9 million, up from $220.2 million in the prior-year period. The adjusted EBITDA margin declined to 8.6% from 12.2% in the year-ago quarter.
2022 Highlights
Revenue for the year was $9.8 billion, up 23% from $8 billion in 2021. Adjusted earnings came in at $3.05 per share, down from $5.65 in 2021. Adjusted EBITDA was $780.6 million, down from $939.1 million in 2021. Adjusted EBITDA margin was 8% for 2022, down from 11.8% in 2021.
Financial Details
As of Dec 31, 2022, MasTec had cash and cash equivalents of $370.6 million, up from $360.7 million at 2021-end. Long-term debt (including finance leases) was $3.05 billion, significantly up from $1.88 billion at 2021-end.
In 2022, the company provided $352.3 million in cash from operating activities compared with $793.1 million a year ago.
First-Quarter 2023 View
MasTec expects revenues of $2.4 billion versus $1.95 billion reported in first-quarter 2022. Adjusted EBITDA is estimated to be nearly $100 million, slightly up from $98.7 million a year ago. The adjusted EBITDA margin is expected to be 4.2%, down from 5% reported in the prior year.
The company expects to report an adjusted loss per share of 57 cents for first-quarter 2023, significantly wider than the previous year’s figure of 3 cents. The expected loss in the to-be-reported quarter is the result of a seasonally slow period, project delays, project start-up costs, as well as integration costs related to recent acquisition activity.
2023 Guidance
The company expects to generate revenues of approximately $13 billion. Adjusted EBITDA is expected between $1.10 and $1.15 billion, with an adjusted EBITDA margin of 8.5-8.8%.
Adjusted earnings are anticipated to be $4.64-$4.91 per share. The Zacks Consensus Estimate for 2023 earnings is currently pegged at $4.94 per share.
The company expects to continue to reduce net debt and improve leverage metrics in 2023, backed by a combination of strong operating performance and moderate capital and strategic investments.
Quanta Services Inc. (PWR - Free Report) has reported impressive results for fourth-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, PWR's earnings beat the consensus mark in the trailing 11 quarters, whereas revenues surpassed the same in eight of the 11 consecutive quarters.
Gibraltar Industries, Inc. (ROCK - Free Report) reported impressive earnings in the fourth quarter of 2022. The company's earnings not only surpassed the Zacks Consensus Estimate but also increased on a year-over-year basis.
ROCK reported adjusted earnings of 72 cents per share, which topped the Zacks Consensus Estimate of 71 cents by 1.4% and increased 28.6% year over year from 56 cents. This was driven by strong contributions from the Renewables and Infrastructure segments, backed by material cost alignment, field operations efficiency, price management, business mix, 80/20 initiatives and the share repurchase program.
KBR, Inc. (KBR - Free Report) reported mixed fourth-quarter 2022 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
The increasing global importance of national security, energy security, energy transition and climate change have been acting as major tailwinds for KBR.
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MasTec's (MTZ) Q4 Earnings & Revenues Beat, 2023 Views Strong
MasTec, Inc. (MTZ - Free Report) reported impressive results for fourth-quarter 2022, where earnings and revenues beat the Zacks Consensus Estimate. Earnings declined year over year, but revenues increased on accretive acquisitions and solid improvement across the segments (barring Oil and Gas).
MTZ’s shares fell 2.08% in the after-hours trading session on Feb 23. The tepid bottom line guidance for first-quarter 2023 might have hurt investors’ sentiment.
Jose Mas, MasTec's CEO, said, "As we end 2022, it is important to note the significant end market transformation we have undertaken over the past two years to support the nation's energy transition to sustainable renewable energy sources. In 2020, MasTec recorded $6.3 billion in revenue, and we currently expect to more than double that level and approximate $13 billion in revenue in 2023. We believe that acquisition activity over the last two years has greatly enhanced our scale, expertise and market positioning to meet expected high customer demand growth for renewable power generation, power grid transmission and distribution and civil infrastructure over the next decade. We believe that this opportunity, coupled with continued expected growth in telecommunications infrastructure and expanding demand for traditional and new green pipeline services, positions us with multiple strong long term growth opportunities."
Inside the Headlines
Adjusted earnings of $1.03 per share beat the Zacks Consensus Estimate of 99 cents by 4% but declined 23.7% from $1.35 reported in the year-ago period.
MasTec, Inc. Price, Consensus and EPS Surprise
MasTec, Inc. price-consensus-eps-surprise-chart | MasTec, Inc. Quote
Revenues of $3 billion also topped the consensus mark of $2.92 billion by 3.1% and increased 66.3% from $1.8 billion a year ago.
At December 2022-end, the company had an 18-month backlog of $12.98 billion, up 13% from $9.94 billion a year ago and 16% from $11.23 billion sequentially.
Segment Update
Revenues from Communications grew 25.9% year over year to $858.6 million. Adjusted EBITDA margin was down 10 basis points (bps) to 11.1%.
Clean Energy and Infrastructure’s revenues increased a whopping 118.6% year over year to $1,125 million. Adjusted EBITDA margin was 7%, up 20 bps from 6.8% in the year-ago quarter.
Revenues from the Oil and Gas segment dropped 13% from the year-ago figure to $291.6 million. Adjusted EBITDA margin declined to 11.5% from 24.3% a year ago.
The Power Delivery (formerly known as Electrical Transmission) segment’s revenues came in at $739.8 million, up 159.2% from the year-ago quarter. Adjusted EBITDA margin came in at 7.7%, up 60 bps from the year-ago period.
Operational Update
The company reported adjusted EBITDA of $257.9 million, up from $220.2 million in the prior-year period. The adjusted EBITDA margin declined to 8.6% from 12.2% in the year-ago quarter.
2022 Highlights
Revenue for the year was $9.8 billion, up 23% from $8 billion in 2021. Adjusted earnings came in at $3.05 per share, down from $5.65 in 2021. Adjusted EBITDA was $780.6 million, down from $939.1 million in 2021. Adjusted EBITDA margin was 8% for 2022, down from 11.8% in 2021.
Financial Details
As of Dec 31, 2022, MasTec had cash and cash equivalents of $370.6 million, up from $360.7 million at 2021-end. Long-term debt (including finance leases) was $3.05 billion, significantly up from $1.88 billion at 2021-end.
In 2022, the company provided $352.3 million in cash from operating activities compared with $793.1 million a year ago.
First-Quarter 2023 View
MasTec expects revenues of $2.4 billion versus $1.95 billion reported in first-quarter 2022. Adjusted EBITDA is estimated to be nearly $100 million, slightly up from $98.7 million a year ago. The adjusted EBITDA margin is expected to be 4.2%, down from 5% reported in the prior year.
The company expects to report an adjusted loss per share of 57 cents for first-quarter 2023, significantly wider than the previous year’s figure of 3 cents. The expected loss in the to-be-reported quarter is the result of a seasonally slow period, project delays, project start-up costs, as well as integration costs related to recent acquisition activity.
2023 Guidance
The company expects to generate revenues of approximately $13 billion. Adjusted EBITDA is expected between $1.10 and $1.15 billion, with an adjusted EBITDA margin of 8.5-8.8%.
Adjusted earnings are anticipated to be $4.64-$4.91 per share. The Zacks Consensus Estimate for 2023 earnings is currently pegged at $4.94 per share.
The company expects to continue to reduce net debt and improve leverage metrics in 2023, backed by a combination of strong operating performance and moderate capital and strategic investments.
Zacks Rank & Recent Construction Releases
MasTec currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quanta Services Inc. (PWR - Free Report) has reported impressive results for fourth-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, PWR's earnings beat the consensus mark in the trailing 11 quarters, whereas revenues surpassed the same in eight of the 11 consecutive quarters.
Gibraltar Industries, Inc. (ROCK - Free Report) reported impressive earnings in the fourth quarter of 2022. The company's earnings not only surpassed the Zacks Consensus Estimate but also increased on a year-over-year basis.
ROCK reported adjusted earnings of 72 cents per share, which topped the Zacks Consensus Estimate of 71 cents by 1.4% and increased 28.6% year over year from 56 cents. This was driven by strong contributions from the Renewables and Infrastructure segments, backed by material cost alignment, field operations efficiency, price management, business mix, 80/20 initiatives and the share repurchase program.
KBR, Inc. (KBR - Free Report) reported mixed fourth-quarter 2022 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
The increasing global importance of national security, energy security, energy transition and climate change have been acting as major tailwinds for KBR.