On June 11, we upgraded Dycom Industries Inc. (
) to a Zacks Rank #2 (Buy).
Why the Upgrade?
Dycom Industries has been witnessing rising earnings estimates
on the back of strong fiscal third-quarter 2013 results and an
enhanced guidance for fourth quarter and fiscal 2014. Moreover,
this leading provider of specialty contracting services delivered
positive earnings surprises in 3 of the last 4 quarters with an
average beat of 17%. The long-term expected earnings growth rate
for this stock is 19.5%
The company released its third quarter fiscal 2013 results in
May with an EPS of 21 cents per share, beating Zacks Consensus
Estimate of 17 cents by 23.5%. Dycom Industries reported total
contract revenue of $ 437.4 million, up 47.7% from the prior-year
quarter. The revenues benefited strongly from organic growth,
which was up 6.2% year over year. Revenues in the quarter also
benefited strongly from subsidiaries acquired during last few
quarters. The company recorded a benefit of $122.9 million from
its recent acquisition of Quanta Services.
Dycom Industries believes its strong competitive position and
strategic market initiatives will facilitate it to perform well
as it moves ahead. Revenue in fourth quarter fiscal 2013 is
expected to be in the range of $455.0 million to $475.0 million,
with an EPS in the range of 40 cents to 47 cents.
The Zacks Consensus Estimate for fourth quarter fiscal 2013
increased 18.42% over the last 30 days to 45 cents per share as
all the estimates were revised higher. The current estimate is
within the guidance range provided by Dycom Industries. For
fiscal 2013, four out of the five estimates were revised higher,
lifting the Zacks Consensus Estimate by 8.5% to $1.15.
Other Stocks to Consider
The following companies operating in the construction sector
also have favorable Zacks Rank and are performing well and,
hence, are worth considering.
Primoris Services (
) carries a Zacks Rank #2 (Buy)
Chicago Bridge (
holds a Zacks Rank #2 (Buy)
Orion Marine Group, Inc (
with a Zacks Rank # 2 (Buy)
CHICAGO BRIDGE (CBI): Free Stock Analysis
DYCOM INDS (DY): Free Stock Analysis Report
ORION MARINE GP (ORN): Free Stock Analysis
PRIMORIS SERVCS (PRIM): Free Stock Analysis
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