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On Tuesday, Quanta Services (NYSE:PWR), currently trading at $341.49 with a market capitalization of $50.66 billion, saw its price target increased by Piper Sandler from $360.00 to $370.00, with the firm maintaining an Overweight rating on the stock. According to InvestingPro data, analysts’ price targets for the stock range from $203.43 to $390.00, reflecting mixed views on the company’s valuation. The adjustment reflects the analyst’s view of a potential uptick in capital expenditure growth rates in the utility sector. The forecasted growth rate could rise from a 6% compound annual growth rate (CAGR) to 15% from 2024 to 2027, spurred by recent recommendations from grid operators. This outlook aligns with Quanta’s recent performance, as the company has demonstrated strong revenue growth of 15.77% over the last twelve months.
Quanta Services, a leading provider in the infrastructure services market, is positioned to benefit from this increased spending on transmission, particularly with expected large 765kV project bookings in the second half of the year. The price target hike to $370 per share is attributed to a slightly higher multiple, as confidence grows regarding the upcoming transmission capital expenditure cycle. InvestingPro analysis indicates the stock is trading at elevated multiples, with a P/E ratio of 54.12 and high EBITDA valuation multiples. For deeper insights into Quanta’s valuation metrics and growth potential, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.
Piper Sandler’s valuation of Quanta Services is based on approximately 18 times the estimated 2026 EBITDA, after accounting for a projected net debt of $874 million at the end of 2026. The Overweight rating remains unchanged, signaling continued positive expectations for the company’s stock performance.
The analyst also noted potential risks that could impact Quanta Services, including adverse regulatory developments, risks associated with acquisitions, and increased competition in the sector. These factors are important considerations for the company as it navigates the expected growth period in the utilities industry.
In other recent news, Quanta Services has announced a quarterly cash dividend of $0.10 per share, scheduled for distribution on July 11, 2025. This move reflects the company’s commitment to delivering shareholder value and aligns with its financial strategies. Analysts from various firms have responded positively to Quanta Services’ recent performance and future outlook. TD Cowen raised its price target for the company to $355, citing strong performance in the Electric Power and Communications segments and a positive outlook from management. Piper Sandler also increased its target to $360, highlighting Quanta’s surpassing of EBITDA expectations and an optimistic financial guidance update.
Stifel analysts lifted their target to $363 following impressive first-quarter results, including an 18% year-over-year increase in backlog and a significant rise in orders. They noted the growth in the Energy Infrastructure segment, particularly with the McCullough-Victorville Transmission Line project. Meanwhile, Jefferies raised its price target to $298 while maintaining a Hold rating, acknowledging the record first-quarter backlog and ongoing discussions around data centers and transmission projects. Despite some uncertainties in renewable energy projects, Jefferies remains optimistic about Quanta Services’ earnings potential. These developments indicate a robust market position for Quanta Services amidst evolving industry trends.
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