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Investing.com - BofA Securities has raised its price target on Dycom Industries (NYSE:DY) to $310.00 from $299.00 while maintaining a Buy rating. The stock, currently trading at $287.45, is near its 52-week high of $289.56, reflecting an impressive 87% surge over the past six months.
The firm cited the Broadband Equity, Access, and Deployment (BEAD) program as potentially adding 10% upside to Dycom’s outer year revenue estimates, assuming an equal four-year distribution of funds.
The $42.45 billion BEAD program, designed to close the digital divide in rural communities, is expected to begin distributing funds by year-end 2025, with capital deployment starting in 2026 and beyond.
BofA Securities estimates a $15-17 billion total addressable market for specialty telecom construction providers like Dycom within the BEAD program.
Assuming a 20% capture rate, the firm projects Dycom could secure approximately $3.0-3.5 billion in revenue and $350-400 million in adjusted EBITDA (12% margin) over the life of the program.
In other recent news, Dycom Industries has been the subject of several analyst updates, particularly concerning its earnings and revenue outlook. UBS maintained its Buy rating and increased its price target for Dycom Industries to $296, citing optimism about the company’s long-term growth prospects. Despite a recent organic revenue miss in the second quarter and weaker third-quarter growth guidance, UBS remains positive about Dycom’s future. Raymond James also raised its price target to $300, maintaining a Strong Buy rating, highlighting Dycom’s strong position in the telecommunications sector. DA Davidson increased its price target to $300, pointing out the company’s first-half margins reaching multi-year highs. Meanwhile, JPMorgan raised its price target to $275, noting improved execution and operational efficiencies that have enhanced Dycom’s margin performance. These developments indicate a general consensus among analysts about Dycom’s potential for growth, despite some recent challenges.
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