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MasTec, Inc. (MTZ - Free Report) reported first-quarter 2023, wherein earnings and revenues beat the Zacks Consensus Estimate. The company reported a wider loss per share compared with the year-ago figure. However, revenues increased on solid improvement across segments.
The quarterly performance reflected the impact of project inefficiencies, mainly at acquired entities, and relatively low volume in Clean Energy and Oil & Gas segments that reduced fixed cost leverage.
MTZ’s shares fell 0.8% in the after-hours trading session on May 4. The decline was most likely due to the lower bottom-line guidance for 2023.
Inside the Headlines
Adjusted loss of 54 cents per share was narrower than the Zacks Consensus Estimate of a loss of 57 cents by 16.9% but wider than the year-ago loss of 3 cents per share.
As of Mar 31 2023, the company had an 18-month backlog of $13.9 billion, up 31% from $10.65 billion a year ago and 7% from $12.98 billion sequentially.
Segment Update
Revenues from Communications grew 21.4% year over year to $806.6 million. Adjusted EBITDA margin was up 150 basis points (bps) to 7.7%.
Clean Energy and Infrastructure’s revenues increased 89.2% year over year to $824.9 million. Adjusted EBITDA margin was 1.3%, down 120 bps year over year.
Revenues from the Oil and Gas segment grew 21.6% from the year-ago figure to $256.5 million. Adjusted EBITDA margin declined 540 bps to 5.7% from the year-ago quarter.
The Power Delivery (formerly known as Electrical Transmission) segment’s revenues came in at $709.4 million, up 9.1% from the year-ago quarter. Adjusted EBITDA margin came in at 6.9%, down 130 bps from the year-ago period.
Operational Update
The company reported adjusted EBITDA of $102.5 million, up from $98.7 million in the prior-year period. The adjusted EBITDA margin declined to 4% from 5% in the year-ago quarter.
Financial Details
As of Mar 31, 2023, MasTec had cash and cash equivalents of $141.6 million, down from $370.6 million at 2022-end. Long-term debt (including finance leases) was $3.05 billion, almost on par with the 2022-end value.
In first-quarter 2023, the company’s net cash used in operating activities was $86.4 million compared with $131.5 million of net cash provided by operating activities a year ago.
Q2 View
MasTec expects revenues of $3 billion, up from $2.3 billion reported in second-quarter 2022. Adjusted EBITDA is estimated to be $250 million, up from $178.5 million a year ago. The adjusted EBITDA margin is expected to be 8.3%, up from 7.8% reported in the prior year.
The company expects to report adjusted earnings per share of 86 cents for second-quarter 2023, up from the previous year’s figure of 73 cents.
Updated 2023 Guidance
The company expects to generate revenues in the range of $13 billion-$13.2 billion. Adjusted EBITDA is expected to be between $1.10 and $1.15 billion, with adjusted EBITDA margin of 8.5-8.7%.
Adjusted earnings are now anticipated to be $4.35-$4.85 per share compared with the previous expectation of $4.64-$4.91 per share. The Zacks Consensus Estimate for 2023 earnings is currently pegged at $4.69 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.
PulteGroup Inc. (PHM - Free Report) reported first-quarter 2023 results, wherein earnings and revenues surpassed the respective Zacks Consensus Estimate and increased year over year.
PHM witnessed solid gross orders, closings and margins in the first quarter and posted a 28% increase in earnings per share and a 12-month return on equity of 32%.
D.R. Horton, Inc. (DHI - Free Report) reported second-quarter fiscal 2023 (ended Mar 31, 2023) results, wherein earnings and revenues surpassed the respective Zacks Consensus Estimate.
Although earnings and revenues declined on a year-over-year basis on prevailing softness in the market, DHI highlighted that net sales orders increased 73% from the fiscal first quarter, defying the prevailing higher mortgage rates and inflationary pressure.
Meritage Homes Corporation (MTH - Free Report) reported better-than-expected results for first-quarter 2023. Both earnings and total closing revenues surpassed the Zacks Consensus Estimate.
The metrics, however, declined from the year-ago quarter’s levels owing to ongoing macroeconomic woes. Impressively, MTH paid its first-ever cash dividend of 27 cents per share in the first quarter, totaling $9.9 million.
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MasTec's (MTZ) Q1 Earnings & Revenues Top, Q2 View Updated
MasTec, Inc. (MTZ - Free Report) reported first-quarter 2023, wherein earnings and revenues beat the Zacks Consensus Estimate. The company reported a wider loss per share compared with the year-ago figure. However, revenues increased on solid improvement across segments.
The quarterly performance reflected the impact of project inefficiencies, mainly at acquired entities, and relatively low volume in Clean Energy and Oil & Gas segments that reduced fixed cost leverage.
MTZ’s shares fell 0.8% in the after-hours trading session on May 4. The decline was most likely due to the lower bottom-line guidance for 2023.
Inside the Headlines
Adjusted loss of 54 cents per share was narrower than the Zacks Consensus Estimate of a loss of 57 cents by 16.9% but wider than the year-ago loss of 3 cents per share.
MasTec, Inc. Price, Consensus and EPS Surprise
MasTec, Inc. price-consensus-eps-surprise-chart | MasTec, Inc. Quote
Revenues of $2.58 billion also topped the consensus mark of $2.39 billion by 8.2% and increased 32.2% from $1.95 billion a year ago.
As of Mar 31 2023, the company had an 18-month backlog of $13.9 billion, up 31% from $10.65 billion a year ago and 7% from $12.98 billion sequentially.
Segment Update
Revenues from Communications grew 21.4% year over year to $806.6 million. Adjusted EBITDA margin was up 150 basis points (bps) to 7.7%.
Clean Energy and Infrastructure’s revenues increased 89.2% year over year to $824.9 million. Adjusted EBITDA margin was 1.3%, down 120 bps year over year.
Revenues from the Oil and Gas segment grew 21.6% from the year-ago figure to $256.5 million. Adjusted EBITDA margin declined 540 bps to 5.7% from the year-ago quarter.
The Power Delivery (formerly known as Electrical Transmission) segment’s revenues came in at $709.4 million, up 9.1% from the year-ago quarter. Adjusted EBITDA margin came in at 6.9%, down 130 bps from the year-ago period.
Operational Update
The company reported adjusted EBITDA of $102.5 million, up from $98.7 million in the prior-year period. The adjusted EBITDA margin declined to 4% from 5% in the year-ago quarter.
Financial Details
As of Mar 31, 2023, MasTec had cash and cash equivalents of $141.6 million, down from $370.6 million at 2022-end. Long-term debt (including finance leases) was $3.05 billion, almost on par with the 2022-end value.
In first-quarter 2023, the company’s net cash used in operating activities was $86.4 million compared with $131.5 million of net cash provided by operating activities a year ago.
Q2 View
MasTec expects revenues of $3 billion, up from $2.3 billion reported in second-quarter 2022. Adjusted EBITDA is estimated to be $250 million, up from $178.5 million a year ago. The adjusted EBITDA margin is expected to be 8.3%, up from 7.8% reported in the prior year.
The company expects to report adjusted earnings per share of 86 cents for second-quarter 2023, up from the previous year’s figure of 73 cents.
Updated 2023 Guidance
The company expects to generate revenues in the range of $13 billion-$13.2 billion. Adjusted EBITDA is expected to be between $1.10 and $1.15 billion, with adjusted EBITDA margin of 8.5-8.7%.
Adjusted earnings are now anticipated to be $4.35-$4.85 per share compared with the previous expectation of $4.64-$4.91 per share. The Zacks Consensus Estimate for 2023 earnings is currently pegged at $4.69 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
MTZ currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
PulteGroup Inc. (PHM - Free Report) reported first-quarter 2023 results, wherein earnings and revenues surpassed the respective Zacks Consensus Estimate and increased year over year.
PHM witnessed solid gross orders, closings and margins in the first quarter and posted a 28% increase in earnings per share and a 12-month return on equity of 32%.
D.R. Horton, Inc. (DHI - Free Report) reported second-quarter fiscal 2023 (ended Mar 31, 2023) results, wherein earnings and revenues surpassed the respective Zacks Consensus Estimate.
Although earnings and revenues declined on a year-over-year basis on prevailing softness in the market, DHI highlighted that net sales orders increased 73% from the fiscal first quarter, defying the prevailing higher mortgage rates and inflationary pressure.
Meritage Homes Corporation (MTH - Free Report) reported better-than-expected results for first-quarter 2023. Both earnings and total closing revenues surpassed the Zacks Consensus Estimate.
The metrics, however, declined from the year-ago quarter’s levels owing to ongoing macroeconomic woes. Impressively, MTH paid its first-ever cash dividend of 27 cents per share in the first quarter, totaling $9.9 million.