MasTec, Inc. (MTZ): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report

By
A A A

Summary:
MasTec's first-quarter 2014 adjusted earnings per share decreased 28% to $0.21. The company reduced its second-quarter earnings per share guidance to $0.40 from $0.53 and also trimmed its revenue guidance to around $1.1 billion from the previous range of $1.15 $1.2 billion. This was blamed on unexpected delays in wireless project spending and weaker-than-expected performance at the oil and gas segment. MasTec's cash position has also reduced substantially due to decreased productivity and delay in the billing and collection process. Moreover, its estimates have undergone negative revisions following weak earnings and guidance cut. We have thus downgraded our recommendation from Outperform to Underperform with a target price of $27.

Overview:

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 has been in operation for more than 80 years and currently has 380 locations with 13,450 employees.

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 for the first quarter as a percentage of revenue were - AT&T (22%) Enbridge (14%) DIRECTV (14%), Duke Energy (5%), Energy Transfer Company (5%), MidAmerican Energy (4%), and ATCO Group, BHP Billiton, Starwood Energy and Talisman Energy 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 (46% of first 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 (40%): The segment performs engineering, construction and maintenance services on oil and natural gas pipelines and processing facilities for the energy and utilities industries.

Electrical Transmission (8%): The segment primarily serves the energy and utility industries through the engineering, construction and maintenance of electrical transmission lines and substations.

Power Generation and Industrial (6%): 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 infrastructure.

Other: It primarily includes small business units that perform construction services for a variety of end markets in Mexico and elsewhere internationally.


MasTec, Inc. (MTZ): Read the Full Research Report
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.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Stocks

Referenced Stocks: MTZ

Zacks.com

Zacks.com

More from Zacks.com:

Related Videos

Stocks

Referenced

Most Active by Volume

111,864,163
  • $3.91 ▲ 2.36%
76,404,746
  • $7.37 ▼ 5.03%
66,680,057
  • $15.25 ▼ 2.12%
61,293,760
  • $30.55 ▼ 6.09%
56,394,825
    $23 unch
55,005,642
  • $95.60 ▼ 2.60%
47,372,853
  • $95.02 ▼ 2.02%
44,783,481
  • $45.19 ▼ 2.40%
As of 7/31/2014, 04:07 PM