MasTec's adjusted earnings declined 10% year over year to $0.53 per
share in third-quarter 2014. For 2014, MasTec projects earnings of
around $1.55 per share. The company expects adjusted earnings per
share to be around $1.87 for the year, reflecting the potential
impact of the slump in global
and expected lower levels of wireless project activity. Unexpected
delays in wireless project spending as well as the effect of low
oil prices on the Oil and Gas segment will remain headwinds in the
near future. Moreover, enhanced debt following acquisitions and
concentration of business among few customers remain concerns. Thus
we maintain our Underperform recommendation on MasTec with a target
price of $17.
MasTec, Inc. (MTZ) is a leading infrastructure construction
company operating throughout the United States. The company engages
in the building, installation, maintenance and upgrade of energy,
communication and utility infrastructure. MasTec caters to a wide
range of industrial customers: utilities (including wind farms,
solar farms and other renewable energy, natural gas gathering
systems and pipeline infrastructure), communications (including
wired and wireless telephony and satellite television) and
government (including water, sewer and other utility and
communications work on military bases.
MasTec's top 10 customers in the third quarter as a percentage
of revenue were - AT&T (16%), DIRECTV (12%), Enbridge (10%),
Berkshire Hathaway Energy (8%) and Canadian Natural Resources (4%).
Duke Energy, Plains All American Pipeline, CenturyLink and
Chesapeake Midstream Partners each contributed 2% to the total
revenue. MasTec reports its results under five segments focused on
broad end-user markets Communications, Oil and Gas, Electrical
Transmission, Power Generation and Industrial and Other.
Communications (39% of third quarter 2014 revenues): The segment
performs engineering, construction and maintenance of
communications infrastructure mainly related to wireless and
wireline communications and install-to-the-home.
Oil and Gas (42%): The segment performs engineering,
construction and maintenance services on oil and natural gas
pipelines and processing facilities for the energy and utilities
Electrical Transmission (10%): The segment primarily serves the
energy and utility industries through the engineering, construction
and maintenance of electrical transmission lines and
Power Generation and Industrial (9%): The segment primarily
serves the energy and utility end-markets and other end-markets
through the installation and construction of conventional and
renewable power plants, related electrical transmission
infrastructure, ethanol facilities and various types of industrial
Other: It primarily includes small business units that perform
construction services for a variety of end markets in Mexico and
MasTec, Inc. (MTZ): Read the Full Research
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
MASTEC INC (MTZ): Free Stock Analysis Report
To read this article on Zacks.com click here.