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In the last reported quarter, the company’s adjusted earnings per share (EPS) and revenues surpassed the Zacks Consensus Estimate by 4.7% and 6.9%, respectively. On a year-over-year basis, total revenues increased 26.6%, and EPS grew 26%.
Encouragingly, earnings topped analysts’ expectations in 17 of the trailing 18 quarters.
The Zacks Consensus Estimate for fourth-quarter EPS has remained unchanged at $1.97 over the past 60 days. The estimated figure indicates a 17.3% increase from the year-ago EPS of $1.68. The consensus mark for revenues is pegged at $5.15 billion, suggesting a 16.6% year-over-year rise.
Factors to Note
Quanta Services is expected to have experienced a positive impact in the upcoming quarter through the implementation and utilization of technological solutions that cover a wide range of initiatives aimed at reducing carbon emissions. These initiatives encompass carbon management, mitigation, and compliance consulting, as well as the development of essential infrastructure to support the delivery of clean, carbon-free energy solutions. The company has been capitalizing on the megatrends to lead the energy transition and enable technological development. Initiatives such as electric vehicle charging infrastructure and undergrounding of electrical infrastructure are gaining momentum. These factors are likely to have helped the company to boost its profit level to some extent.
Segment-wise, the Electric Power Infrastructure Services segment (which accounted for 52.4% of total revenues in 2022) is likely to have benefited from broad-based business strength, driven by ongoing grid modernization, system hardening, renewable energy interconnections and solid execution. Also, contributions from larger transmission projects underway in Canada and revenues from the acquired businesses are likely to have supported bottom-line growth in the to-be-reported quarter.
PWR expects segment revenues to grow in the mid-single-digit range from a year ago.
For the Electric Power segment, our model predicts segment revenues to grow 4% year over year to $2.41 billion from a year ago. Operating margin is expected to be 10.8% in the quarter, down from 11.5% a year ago.
The Underground Utility and Infrastructure Solutions segment (which accounted for 25.5% of total revenues in 2022) has been benefiting from higher demand for gas utility and pipeline integrity services and pent-up demand for the services that were deferred due to the effects of COVID-19 on the downstream market.
For the Underground Utility and Infrastructure Solutions segment, our model predicts revenues to decline 8.7% year over year to $1 billion from a year ago. Operating margin is expected to be 7% in the quarter, down from 7.1% a year ago.
Meanwhile, the Renewable Energy Infrastructure Solutions segment (22.1%) consists of services and solutions for infrastructure supporting the delivery of renewable energy, including renewable generation, electric transmission, substations and battery storage, with Blattner's operations representing the majority of those solutions. This addition is expected to have contributed to the company’s top line in the to-be-reported quarter.
For the Renewable Energy Infrastructure Solutions segment, our model predicts revenues to grow 68.2% year over year to $1.68 billion from a year ago. Operating margin is expected to be 9% in the quarter, up from 6.4% a year ago.
What the Zacks Model Says
Our proven model does not conclusively predict an earnings beat for Quanta Services this time around. A combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The company has an Earnings ESP of 0.00%.
Zacks Rank: Quanta Services currently carries a Zacks Rank #4 (Sell).
Stocks With Favorable Combination
Here are some other companies in the Zacks Construction sector, which according to our model, have the right combination of elements to post an earnings beat on their respective quarters to be reported.
AWI’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, with the average being 7.9%. Earnings for the to-be-reported quarter are expected to decline 4.6% year over year.
Floor & Decor Holdings, Inc. (FND - Free Report) has an Earnings ESP of +4.87% and a Zacks Rank #3.
FND’s earnings for the to-be-reported quarter are expected to decline 57.8%. The company reported better-than-expected earnings in two of the last four quarters, missed on one occasion and met on another one, the average surprise being 4.9%.
Enviva Inc. (EVA - Free Report) has an Earnings ESP of +37.36% and has a Zacks Rank #2.
EVA’s earnings missed the consensus mark in each of the last four quarters, with the average being 114.8%. Earnings for the to-be-reported quarter are expected to decline 59.2% year over year.
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Factors Setting the Tone for Quanta Services' (PWR) Q4 Earnings
Quanta Services, Inc. (PWR - Free Report) is scheduled to report fourth-quarter 2023 results on Feb 22, before the opening bell.
In the last reported quarter, the company’s adjusted earnings per share (EPS) and revenues surpassed the Zacks Consensus Estimate by 4.7% and 6.9%, respectively. On a year-over-year basis, total revenues increased 26.6%, and EPS grew 26%.
Encouragingly, earnings topped analysts’ expectations in 17 of the trailing 18 quarters.
Quanta Services, Inc. Price and EPS Surprise
Quanta Services, Inc. price-eps-surprise | Quanta Services, Inc. Quote
Trend in Estimate Revision
The Zacks Consensus Estimate for fourth-quarter EPS has remained unchanged at $1.97 over the past 60 days. The estimated figure indicates a 17.3% increase from the year-ago EPS of $1.68. The consensus mark for revenues is pegged at $5.15 billion, suggesting a 16.6% year-over-year rise.
Factors to Note
Quanta Services is expected to have experienced a positive impact in the upcoming quarter through the implementation and utilization of technological solutions that cover a wide range of initiatives aimed at reducing carbon emissions. These initiatives encompass carbon management, mitigation, and compliance consulting, as well as the development of essential infrastructure to support the delivery of clean, carbon-free energy solutions. The company has been capitalizing on the megatrends to lead the energy transition and enable technological development. Initiatives such as electric vehicle charging infrastructure and undergrounding of electrical infrastructure are gaining momentum. These factors are likely to have helped the company to boost its profit level to some extent.
Segment-wise, the Electric Power Infrastructure Services segment (which accounted for 52.4% of total revenues in 2022) is likely to have benefited from broad-based business strength, driven by ongoing grid modernization, system hardening, renewable energy interconnections and solid execution. Also, contributions from larger transmission projects underway in Canada and revenues from the acquired businesses are likely to have supported bottom-line growth in the to-be-reported quarter.
PWR expects segment revenues to grow in the mid-single-digit range from a year ago.
For the Electric Power segment, our model predicts segment revenues to grow 4% year over year to $2.41 billion from a year ago. Operating margin is expected to be 10.8% in the quarter, down from 11.5% a year ago.
The Underground Utility and Infrastructure Solutions segment (which accounted for 25.5% of total revenues in 2022) has been benefiting from higher demand for gas utility and pipeline integrity services and pent-up demand for the services that were deferred due to the effects of COVID-19 on the downstream market.
For the Underground Utility and Infrastructure Solutions segment, our model predicts revenues to decline 8.7% year over year to $1 billion from a year ago. Operating margin is expected to be 7% in the quarter, down from 7.1% a year ago.
Meanwhile, the Renewable Energy Infrastructure Solutions segment (22.1%) consists of services and solutions for infrastructure supporting the delivery of renewable energy, including renewable generation, electric transmission, substations and battery storage, with Blattner's operations representing the majority of those solutions. This addition is expected to have contributed to the company’s top line in the to-be-reported quarter.
For the Renewable Energy Infrastructure Solutions segment, our model predicts revenues to grow 68.2% year over year to $1.68 billion from a year ago. Operating margin is expected to be 9% in the quarter, up from 6.4% a year ago.
What the Zacks Model Says
Our proven model does not conclusively predict an earnings beat for Quanta Services this time around. A combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The company has an Earnings ESP of 0.00%.
Zacks Rank: Quanta Services currently carries a Zacks Rank #4 (Sell).
Stocks With Favorable Combination
Here are some other companies in the Zacks Construction sector, which according to our model, have the right combination of elements to post an earnings beat on their respective quarters to be reported.
Armstrong World Industries (AWI - Free Report) has an Earnings ESP of +2.66% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
AWI’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, with the average being 7.9%. Earnings for the to-be-reported quarter are expected to decline 4.6% year over year.
Floor & Decor Holdings, Inc. (FND - Free Report) has an Earnings ESP of +4.87% and a Zacks Rank #3.
FND’s earnings for the to-be-reported quarter are expected to decline 57.8%. The company reported better-than-expected earnings in two of the last four quarters, missed on one occasion and met on another one, the average surprise being 4.9%.
Enviva Inc. (EVA - Free Report) has an Earnings ESP of +37.36% and has a Zacks Rank #2.
EVA’s earnings missed the consensus mark in each of the last four quarters, with the average being 114.8%. Earnings for the to-be-reported quarter are expected to decline 59.2% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.