Quanta Services Inc (PWR, Financial) experienced a daily loss of 5.99%, with a 3-month loss of 17.08%. Despite this, the company's Earnings Per Share (EPS) stands at 3.92. This prompts the question: is the stock fairly valued? In this article, we aim to provide an in-depth valuation analysis of Quanta Services (PWR). So, let's dive in.
Company Overview
Quanta Services is a leading provider of specialty contracting services, delivering comprehensive infrastructure solutions for the electric and gas utility, communications, pipeline, and energy industries in the United States, Canada, and Australia. The company operates under three reportable segments: electric power, renewables infrastructure, and underground utility and infrastructure. In 2021, Quanta acquired Blattner, a provider of comprehensive engineering, procurement, and construction solutions to customers in the renewable energy industry.
With a current stock price of $157.11 per share and a market cap of $22.80 billion, it's essential to compare this with the GF Value, an estimation of fair value, which stands at $168.94. This comparison will provide a more profound exploration of the company's value.
Understanding the GF Value
The GF Value represents the current intrinsic value of a stock derived from our exclusive method. The GF Value Line on our summary page gives an overview of the fair value that the stock should be traded at. It is calculated based on three factors:
- Historical multiples (PE Ratio, PS Ratio, PB Ratio and Price-to-Free-Cash-Flow) that the stock has traded at.
- GuruFocus adjustment factor based on the company's past returns and growth.
- Future estimates of the business performance.
We believe the GF Value Line is the fair value that the stock should be traded at. If the stock price is significantly above the GF Value Line, it is overvalued and its future return is likely to be poor. On the other hand, if it is significantly below the GF Value Line, its future return will likely be higher.
According to GuruFocus Value calculation, Quanta Services stock appears to be fairly valued. This estimation is based on the historical multiples that the stock has traded at, the past business growth, and analyst estimates of future business performance.
Given that Quanta Services is fairly valued, the long-term return of its stock is likely to be close to the rate of its business growth.
Link: These companies may deliver higher future returns at reduced risk.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
