Dycom Industries, Inc. (DY - Free Report) is scheduled to report first-quarter fiscal 2021 results on May 19, before the opening bell.
In the last reported quarter, it reported adjusted loss of 23 cents per share, wider than the Zacks Consensus Estimate of a loss of 2 cents. In the year-ago quarter, the company had reported earnings of 10 cents per share. Dycom’s quarterly contract revenues came in at $737.6 million, increasing 1.5% year over year. The reported figure also surpassed the consensus mark of $727.6 million by 1.4%. The company highlighted that adverse weather, seasonal effects, challenges surrounding a large customer program, and a slow start with a specific customer in rolling out its new system weighed on margins in the quarter.
This specialty contracting services provider — which shares space in the Building Products - Heavy Construction industry with EMCOR Group, Inc. (EME - Free Report) , MasTec, Inc. (MTZ - Free Report) and North American Construction Group Ltd. (NOA - Free Report) — outperformed the industry in the past six months. The stock has lost 8.1% against the industry’s growth of 29.5% in the said period.
Earnings & Revenue Expectations
The Zacks Consensus Estimate for Dycom’s fiscal first-quarter bottom line has widened from a loss of 1 cent to loss of 3 cents per share over the past 30 days. The bottom-line estimate indicates a 105.7% decline on a year-over-year basis. The consensus estimate for revenues is $738.7 million, indicating 11.4% year-over-year fall.
Factors to Note
Dycom’s revenues and earnings are expected to have declined in the quarter to be reported, thanks to lower-than-expected activity levels due to challenging market conditions, crew health concerns and permitting delays, despite that fact that the majority of its work is deemed essential. Also, challenges surrounding a large customer program, and a slow start with a specific customer in rolling out its new system may have added to the woes.
During fourth-quarter fiscal 2020 earnings call, the company had projected contract revenues in the range of $730-$780 million for the fiscal first quarter, indicating a decline from $833.7 million reported a year ago.
From the margins perspective, it has been experiencing lower EBITDA margins. The company pointed out that although major customers have stepped up infrastructure spending, higher-than-expected costs of a large customer program have been denting margins. It expects the bottom line for the fiscal first quarter between a loss of 9 cents and earnings of 8 cents per share on an adjusted basis. The prior-year reported earnings were 53 cents per share. It also expects adjusted EBITDA margin to decrease from the year-ago period.
What the Zacks Model Says
Our proven model does not conclusively predict an earnings beat for Dycom this time around. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to deliver a positive surprise. This is not the case here, as you will see below.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is -100.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Dycom currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>