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MasTec Stock Poised for Long-Term Growth: Should You Buy MTZ Now?
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MasTec, Inc.’s (MTZ - Free Report) business has been witnessing strong growth over the past few quarters. This infrastructure construction company is banking on increasing demand for power, data capacity and network speed.
In the past six months, MasTec's stock has gained 35% comparing favorably with the Zacks Building Products - Heavy Construction industry, the broader Construction sector and the S&P 500 index’s growth of 27.3%, 7.7% and 10.8%, respectively.
MTZ stock also outpaced its competitors like EMCOR Group, Inc. (EME - Free Report) , Quanta Services, Inc. (PWR - Free Report) and AECOM (ACM - Free Report) , which rallied 20.5%, 16.6% and 6.2%, respectively, in the past six-month period.
Image Source: Zacks Investment Research
MTZ’s focus on strategic investments for portfolio diversification positions it well for satiating increased infrastructure demand globally. Impressively, the company is optimistic about its growth opportunities in 2025 and beyond, given the solid pipeline across its businesses and acquisition synergies.
Let’s see in detail why MTZ stock is still a buy for investors.
Solid Outlook for 2024 & Beyond
MasTec’s future looks promising, with a robust 18-month backlog of $13.3 billion providing strong visibility into 2024. The company has raised its full-year guidance, expecting consolidated revenues of $12.4 billion, up from $12 billion year over year. Adjusted EBITDA is forecasted to increase to $975 million, with adjusted earnings per share (EPS) projected to be $3.03, up from the previous estimate of $1.97.
The Clean Energy and Infrastructure segment is expected to increase 10% in 2024, while the Power Delivery segment has secured a major high-voltage transmission project, offering significant growth opportunities through 2028. MasTec’s Communications segment is also poised for expansion, with revenues expected to grow 4.5% in 2024.
Strategic Acquisitions Driving Growth
One of the key drivers of MasTec's growth is its focus on strategic acquisitions. In 2023, the company completed four acquisitions, enhancing its capabilities across key segments.
MasTec has also made significant equity investments, including a 49% stake in entities within its Communications and Power Delivery segments. These acquisitions and investments enable MasTec to capture new business and expand its service offerings, further boosting its growth potential.
Expanding Communications Pipeline
MasTec’s relationship with AT&T, its largest wireless client, has deepened, along with expanded service offerings. As AT&T replaces Nokia equipment with Ericsson, MasTec is expected to benefit from significant business growth in its wireless segment starting in the second half of 2024. The growing demand for wireline services and the anticipated Broadband Equity, Access, and Deployment program funding further enhance the long-term visibility of MasTec’s Communications business.
With new customer interest and strong bookings, the company expects double-digit revenue growth in 2025.
Strong Financials & Earnings Growth
MasTec’s strong financial performance is backed by solid earnings surprises in recent quarters. Its EPS surpassed the consensus estimate in three of the trailing four quarters and missed on one occasion, with the average surprise being 19.4%.
The company’s 2024 and 2025 EPS estimates reflect impressive growth of 53.3% and 44.2%, respectively. With a VGM Score of B, MasTec is well-positioned to continue outperforming the market in the near term.
Why MasTec is a Smart Investment?
MasTec’s diverse portfolio, strategic acquisitions, and expanding client relationships make it a compelling investment. The company is positioned to benefit from growing trends in renewable energy, communications infrastructure, and high-voltage power transmission projects. With robust financials and positive analyst sentiment, MTZ stock is well-suited for investors looking for long-term growth in the infrastructure space.
As MasTec continues to execute its growth strategy, it offers multiple pathways for profitable growth in both the near and long term.
Technical indicators also remain favorable, with MTZ trading comfortably above its 50-day moving average.
Image: Bigstock
MasTec Stock Poised for Long-Term Growth: Should You Buy MTZ Now?
MasTec, Inc.’s (MTZ - Free Report) business has been witnessing strong growth over the past few quarters. This infrastructure construction company is banking on increasing demand for power, data capacity and network speed.
In the past six months, MasTec's stock has gained 35% comparing favorably with the Zacks Building Products - Heavy Construction industry, the broader Construction sector and the S&P 500 index’s growth of 27.3%, 7.7% and 10.8%, respectively.
MTZ stock also outpaced its competitors like EMCOR Group, Inc. (EME - Free Report) , Quanta Services, Inc. (PWR - Free Report) and AECOM (ACM - Free Report) , which rallied 20.5%, 16.6% and 6.2%, respectively, in the past six-month period.
Image Source: Zacks Investment Research
MTZ’s focus on strategic investments for portfolio diversification positions it well for satiating increased infrastructure demand globally. Impressively, the company is optimistic about its growth opportunities in 2025 and beyond, given the solid pipeline across its businesses and acquisition synergies.
Let’s see in detail why MTZ stock is still a buy for investors.
Solid Outlook for 2024 & Beyond
MasTec’s future looks promising, with a robust 18-month backlog of $13.3 billion providing strong visibility into 2024. The company has raised its full-year guidance, expecting consolidated revenues of $12.4 billion, up from $12 billion year over year. Adjusted EBITDA is forecasted to increase to $975 million, with adjusted earnings per share (EPS) projected to be $3.03, up from the previous estimate of $1.97.
The Clean Energy and Infrastructure segment is expected to increase 10% in 2024, while the Power Delivery segment has secured a major high-voltage transmission project, offering significant growth opportunities through 2028. MasTec’s Communications segment is also poised for expansion, with revenues expected to grow 4.5% in 2024.
Strategic Acquisitions Driving Growth
One of the key drivers of MasTec's growth is its focus on strategic acquisitions. In 2023, the company completed four acquisitions, enhancing its capabilities across key segments.
MasTec has also made significant equity investments, including a 49% stake in entities within its Communications and Power Delivery segments. These acquisitions and investments enable MasTec to capture new business and expand its service offerings, further boosting its growth potential.
Expanding Communications Pipeline
MasTec’s relationship with AT&T, its largest wireless client, has deepened, along with expanded service offerings. As AT&T replaces Nokia equipment with Ericsson, MasTec is expected to benefit from significant business growth in its wireless segment starting in the second half of 2024. The growing demand for wireline services and the anticipated Broadband Equity, Access, and Deployment program funding further enhance the long-term visibility of MasTec’s Communications business.
With new customer interest and strong bookings, the company expects double-digit revenue growth in 2025.
Strong Financials & Earnings Growth
MasTec’s strong financial performance is backed by solid earnings surprises in recent quarters. Its EPS surpassed the consensus estimate in three of the trailing four quarters and missed on one occasion, with the average surprise being 19.4%.
The company’s 2024 and 2025 EPS estimates reflect impressive growth of 53.3% and 44.2%, respectively. With a VGM Score of B, MasTec is well-positioned to continue outperforming the market in the near term.
Why MasTec is a Smart Investment?
MasTec’s diverse portfolio, strategic acquisitions, and expanding client relationships make it a compelling investment. The company is positioned to benefit from growing trends in renewable energy, communications infrastructure, and high-voltage power transmission projects. With robust financials and positive analyst sentiment, MTZ stock is well-suited for investors looking for long-term growth in the infrastructure space.
As MasTec continues to execute its growth strategy, it offers multiple pathways for profitable growth in both the near and long term.
Technical indicators also remain favorable, with MTZ trading comfortably above its 50-day moving average.
Image Source: Zacks Investment Research
These positives reinforce its Zacks Rank #2 (Buy) rating, making MTZ a smart addition to investors' portfolios at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.