Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Quanta Services Stock: Low Dividends, Solid Fundamentals

Stock MarketsSep 13, 2021 03:31PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. Quanta Services Stock: Low Dividends, Solid Fundamentals

I am bullish on Quanta Services , Inc. (NYSE:PWR) stock.  

Quanta sells, installs, upgrades, repairs, and maintains infrastructure and network solutions to the electric power, oil, gas, and communication industries. Over 24 years, Quanta has built a market cap of $16 billion. (See PWR stock charts on TipRanks)

Quanta Engineers Money

Quanta's revenue has trended upward in each of the past five years, save for a pandemic-influenced 2020. Despite the pandemic’s toll on the North American economy, Quanta’s net income in Fiscal Year 2020 was $446 million, up 10.8% year-over-year.

Quanta’s assets as of Q2 2021 were $8.7 billion, against liabilities of $4.2 billion.

TipRanks assigns PWR a Smart Score of 8 out of 10, citing bullish blogger opinions, very positive investor sentiment, and positive technicals.

America is upgrading its power grids, modernizing its harbors and airports, expanding renewable sources of energy, and bringing Internet access to millions of people living in wi-fi deserts.

The country needs grids and lines for EVs. Power companies are trending towards outsourcing developments and maintenance. Quanta has such a 15-year long contract to maintain the power distribution system of Puerto Rico.

Worth a Mention

Insider trading was heavy on the sell-side over the past three months, far outdistancing the number of shares insiders bought.

As well, management appears more committed to M&As than increasing its dividend. The company has acquired over 200 companies since its founding.

The announcement of Quanta’s acquisition of energy storage company Blattner Holdings Co., sparked a 13% pop in the share price over two days in September, expressing the volatility of the stock. Blattner cost $2.7 billion in cash and shares of PWR.

The dividend has not grown in three years, hovering at 0.2%. That is well below the unimpressive average for the Industrial Sector of 1.25%.

Lastly, one must ponder how inflation, wage increases, labor shortages, and shortages of raw materials and manufactured goods will affect earnings over the next two years. What if the pending infrastructure legislation fails to pass, or the allocations are halved as one Senate Democrat proposes?

Bottom Line

Quanta operates in high-value sectors, and the average PWR price target has an upside potential of 9.9%. Shares sell at near-to-fair value, despite being so volatile.

Quanta is in a sound position to benefit from an expanding economy, more federal spending, and outsourcing by utility companies.

Overall, PWR is low-risk with solid growth potential..

Disclosure: At the time of publication, Harold Goldmeier did not have a position in any of the securities mentioned in this article.

​Disclaimer: The information contained in this article represents the views and opinion of the writer only, and not the views or opinion of TipRanks or its affiliates, and should be considered for informational purposes only. TipRanks makes no warranties about the completeness, accuracy or reliability of such information. Nothing in this article should be taken as a recommendation or solicitation to purchase or sell securities. Nothing in the article constitutes legal, professional, investment and/or financial advice and/or takes into account the specific needs and/or requirements of an individual, nor does any information in the article constitute a comprehensive or complete statement of the matters or subject discussed therein. TipRanks and its affiliates disclaim all liability or responsibility with respect to the content of the article, and any action taken upon the information in the article is at your own and sole risk. The link to this article does not constitute an endorsement or recommendation by TipRanks or its affiliates. Past performance is not indicative of future results, prices or performance.

Quanta Services Stock: Low Dividends, Solid Fundamentals

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email