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What to Expect From Quanta Services' (PWR) Q2 Earnings?
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Quanta Services, Inc. (PWR - Free Report) is scheduled to report second-quarter 2024 results on Aug 1, 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 11.9% and 1.5%, respectively. On a year-over-year basis, total revenues increased 13.6%, and EPS grew 13.7%.
Encouragingly, earnings topped analysts’ expectations in 19 of the trailing 20 quarters.
Trend in Estimate Revision
The Zacks Consensus Estimate for second-quarter EPS has decreased to $1.93 from $1.95 over the past 30 days. The estimated figure indicates a 17% increase from the year-ago EPS of $1.65. The consensus mark for revenues is pegged at $5.51 billion, suggesting a 9.2% year-over-year rise.
Quanta Services is expected to have experienced a positive impact in the quarter through the implementation and utilization of technological solutions covering a wide range of initiatives to reduce carbon emissions. These initiatives encompass carbon management, mitigation, compliance consulting, and 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 boost its profit level in the second quarter.
Segment-wise, the Electric Power Infrastructure Services segment (which accounted for 46.5% of total revenues in 2023) 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 sequentially. The company also expects operating margin to improve to double digits in the second quarter, similar to the second quarter of 2023.
For the Electric Power segment, our model predicts segment revenues to grow 9.3% year over year to $2.64 billion from a year ago. Operating margin is expected to be 10.2% in the quarter, up from 10.1% a year ago.
The Underground Utility and Infrastructure Solutions segment (which accounted for 24% of total revenues in 2023) 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.
The company expects second-quarter segment revenues to be in line with the first quarter and operating margin to improve sequentially.
For the Underground Utility and Infrastructure Solutions segment, our model predicts revenues to decline 8.8% year over year to $1.13 billion from a year ago. Operating margin is expected to be 8.2% in the quarter, down from 8.6% from a year ago but up from 4.2% in the prior quarter.
Meanwhile, the Renewable Energy Infrastructure Solutions segment (29.5%) 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.
The company expects segment revenues to grow sequentially and the operating margin to be slightly lower than the second quarter of 2023.
For the Renewable Energy Infrastructure Solutions segment, our model predicts revenues to grow 26.5% year over year to $1.76 billion from a year ago. Operating margin is expected to be 7.2% in the quarter, down from 8% 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 -2.22%.
Zacks Rank: Quanta Services currently carries a Zacks Rank #3.
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 beat on earnings in their respective quarters to be reported.
DY’s earnings for the to-be-reported quarter are expected to increase 7.4%. The company reported better-than-expected earnings in three of the last four quarters and missed on one occasion, the average surprise being 30.2%.
Eagle Materials Inc. (EXP - Free Report) has an Earnings ESP of +2.20% and a Zacks Rank #3.
EXP’s earnings for the to-be-reported quarter are expected to grow 0.6%. The company reported better-than-expected earnings in three of the last four quarters and missed on one occasion, the average negative surprise being 2.6%.
Aspen Aerogels, Inc. (ASPN - Free Report) has an Earnings ESP of +23.53% and sports a Zacks Rank #1.
ASPN’s earnings topped the consensus mark in all the last four quarters, with the average being 68.2%. Earnings for the to-be-reported quarter are expected to grow 122.7% year over year.
Image: Bigstock
What to Expect From Quanta Services' (PWR) Q2 Earnings?
Quanta Services, Inc. (PWR - Free Report) is scheduled to report second-quarter 2024 results on Aug 1, 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 11.9% and 1.5%, respectively. On a year-over-year basis, total revenues increased 13.6%, and EPS grew 13.7%.
Encouragingly, earnings topped analysts’ expectations in 19 of the trailing 20 quarters.
Trend in Estimate Revision
The Zacks Consensus Estimate for second-quarter EPS has decreased to $1.93 from $1.95 over the past 30 days. The estimated figure indicates a 17% increase from the year-ago EPS of $1.65. The consensus mark for revenues is pegged at $5.51 billion, suggesting a 9.2% year-over-year rise.
Quanta Services, Inc. Price and EPS Surprise
Quanta Services, Inc. price-eps-surprise | Quanta Services, Inc. Quote
Factors to Note
Quanta Services is expected to have experienced a positive impact in the quarter through the implementation and utilization of technological solutions covering a wide range of initiatives to reduce carbon emissions. These initiatives encompass carbon management, mitigation, compliance consulting, and 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 boost its profit level in the second quarter.
Segment-wise, the Electric Power Infrastructure Services segment (which accounted for 46.5% of total revenues in 2023) 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 sequentially. The company also expects operating margin to improve to double digits in the second quarter, similar to the second quarter of 2023.
For the Electric Power segment, our model predicts segment revenues to grow 9.3% year over year to $2.64 billion from a year ago. Operating margin is expected to be 10.2% in the quarter, up from 10.1% a year ago.
The Underground Utility and Infrastructure Solutions segment (which accounted for 24% of total revenues in 2023) 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.
The company expects second-quarter segment revenues to be in line with the first quarter and operating margin to improve sequentially.
For the Underground Utility and Infrastructure Solutions segment, our model predicts revenues to decline 8.8% year over year to $1.13 billion from a year ago. Operating margin is expected to be 8.2% in the quarter, down from 8.6% from a year ago but up from 4.2% in the prior quarter.
Meanwhile, the Renewable Energy Infrastructure Solutions segment (29.5%) 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.
The company expects segment revenues to grow sequentially and the operating margin to be slightly lower than the second quarter of 2023.
For the Renewable Energy Infrastructure Solutions segment, our model predicts revenues to grow 26.5% year over year to $1.76 billion from a year ago. Operating margin is expected to be 7.2% in the quarter, down from 8% 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 -2.22%.
Zacks Rank: Quanta Services currently carries a Zacks Rank #3.
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 beat on earnings in their respective quarters to be reported.
Dycom Industries (DY - Free Report) has an Earnings ESP of +4.43% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
DY’s earnings for the to-be-reported quarter are expected to increase 7.4%. The company reported better-than-expected earnings in three of the last four quarters and missed on one occasion, the average surprise being 30.2%.
Eagle Materials Inc. (EXP - Free Report) has an Earnings ESP of +2.20% and a Zacks Rank #3.
EXP’s earnings for the to-be-reported quarter are expected to grow 0.6%. The company reported better-than-expected earnings in three of the last four quarters and missed on one occasion, the average negative surprise being 2.6%.
Aspen Aerogels, Inc. (ASPN - Free Report) has an Earnings ESP of +23.53% and sports a Zacks Rank #1.
ASPN’s earnings topped the consensus mark in all the last four quarters, with the average being 68.2%. Earnings for the to-be-reported quarter are expected to grow 122.7% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.