_edited.png)
RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Quanta Services, Inc. (XNYS:PWR) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
PWR
Name:
QUANTA SERVICES, INC. (XNYS:PWR)
Sector:
- 24847.00K
Industry:
Engineering & Construction
CEO:
Mr. Earl Austin
Total Employees:
43,700
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is -7.08% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF QUANTA SERVICES, INC.(PWR) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND ENGINEERING & CONSTRUCTION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
140.6
One Month Price Target:
$141.45
Six Month Price Target :
$145.72
Likely Price in One Year's Time:
Ticker:
$150.85
Likely Trading Range Today Under (Normal Volatility)
$140.29
Price Upper limit ($) :
$141.52
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$133.45
This week:
$124.61
This month :
$108.63
Other Primary facts
Market Cap:
20.06B
Market Cap Classification:
Large Cap
Number of Shares
IPO Date:
143.02M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
15.97%
-13.13%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$173.69
$157.96
$107.51
$123.24
Medium risk (<10%) entry points
Buy Call
Sell Call
$152.84
Buy Put:
Sell Put:
$149.48
$128.32
$131.72
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
PWR
Sharpe Ratio:
8.01%
Comparison:
PWR, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 101.69% higher than the industry
& ratio is 251.50% higher than the market/S&P 500 average
Average Returns/Yield of
PWR
Daily returns:
0.22%
Weekly returns:
1.08%
Monthly returns:
4.31%
Yearly returns:
37.49%
Comparison of returns:
Average annual returns/yield (last 3 years) is 38.04% above industry average
Classification:
PWR, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.03
Statistical test of Returns:
PWR has yielded a higher return than the market, the results are statistically significant
Volatility (measured by Standard Deviation)
Daily Volatility:
2.58%
Weekly Volatility:
5.77%
Monthly Volatility:
11.54%
Yearly Volatility:
39.98%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.79%
Volatility in last five trading days has been -30.56% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-5.08%
Weekly VaR:
-11.37%
Monthly VaR:
-22.74%
How Much Can the price of
PWR
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-18%
Worst case (decline):
-78.77%
This translates to price declining to:
$115.82
This translates to price declining to:
$29.85
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
PWR is a 60.49% riskier investment compared to the market/S&P 500 & is 37.49% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -24.20% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
PWR
Beta in relation to market/S&P 500--1.08
Expected beta in 1 year's time:
0.905
Expected beta in 3 year's time:
1.28
Unlevered (debt free) Beta:
0.67
Beta in relation to Nasdaq (XNAS):
0.779
Beta in relation to all global stocks::
0.728
Beta Comparison & Analysis
Beta of competitors/peers::
1.269
Beta is -14.54% lower than peers
Average Industry Beta:
1.325
Beta is -18.15% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
11.58%
Sustainable growth rate is -16.24% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.412
Alpha is 62.97% above industry average alpha yield
Alpha is 2621% higher than market/& is unsustainably high
Analysis of Cost of Capital of
PWR
Equity cost of capital:
0.106
Equity cost of capital is -13.47% below industry mean WACC
Unlevered (without debt) cost of capital:
6.54%
Before-tax cost of debt:
1.99%
After-tax cost of debt:
1.57%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.57%
WACC is -9.53% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$99.58
Revenue growth rate per share of (3Y):
3.91
Annual revenue growth rate is -47.04% below industry average
EPS:
$3.30
Expected Annual growth rate of EPS (3Y):
6.56%
Expected future EPS growth rate is -48.85% lower than the Engineering & Construction industry
Free cash flow (FCF) per share:
$0.90
-
-
Debt per share
$27.85
EBITDA per share
$7.16
Valuation Analysis Today of
PWR
P/E Ratio:
45.63
P/E Ratio of Competitors/Peers:
17.19
P/E ratio is 165.46% higher than main peers & is 57.35% higher than the industry
Stock price/value with industry average P/E ratio: $95.70
PWR is 46.91% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $19.30
Present value of the expected future dividends only: $4.05
P/S (Price to Sales ratio):
1.41
Price to sales ratio is -77.11% below the industry mean
P/B (Price to book value ratio):
3.91
Price to free cash flow: 157.08
Price to free cash flow ratio is 107.18% higher than the industry
Net income growth rate (3Y):
80.99%
Net income growth rate is -1223.20% lower than the industry average net income growth rate
Dividend Analysis
-
Dividend yeild: 0.19%
Previous Dividend: $0.07
Previous adjusted dividend: $0.07
Previous Dividend: $0.27
Expected next dividend best case: $0.08
Expected next dividend worst case: $0.06
Average dividend payment (long-term): $0.06
Average dividend increase/decrease (growth rate) % per period: 3.67%
Expected next dividend payment date: 13/10/2022
Expected next dividend record date: 29/09/2022
Expected next dividend declaration date: 25/08/2022
Previous dividend payment date: 15/07/2022
Previous dividend record date: 07/01/2022
Previous dividend declaration date: 27/05/2022
Dividend History:
2022-06-30--$0.07
2022-01-03--$0.07
2021-06-30--$0.06
2022-04-08--$0.07
2021-09-30--$0.06
2021-04-05--$0.06
Dividend growth rate is 49.77% higher than the average industry
In-depth Debt & Leverage Analysis
Debt to equity ratio:
77.52%
Net debt to equity ratio:
74.81%
Debt to assets ratio:
30.60%
Net debt to assets ratio:
29.53%
Debt-to-asset ratio is -42.44% below industry average
Ability to repay debt:
Interest coverage ratio:
12.61
Interest coverage ratio is -48.17% less than industry average
Looking forward:
Debt growth rate:
236.60%
Annual debt growth is 48% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.648
Statistical significance of correlation:
PWR has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.523
Stock price is 23.81% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.523
Correlation of price movement with Nasdaq (^IXIC):
0.011
Covariance of price movement with the market:
0.016
Kurtosis
5.136
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
0.239
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
PWR
Gross Profit Margin Ratio:
60%
Operating Profit Margin Ratio:
4.69%
Operating profit margin is -134.05% lower than the industry
Net Profit Margin Ratio:
60%
Effective Tax Rate:
20.31%
Effective tax rate is -1.91% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
9.37%
Return on equity (ROE) is -20.23% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
3.70%
Return on assets (ROA) is -10.17% lower than the industry
Financial Leverage:
1.4x
Current Ratio:
1.51
Current ratio is -46.25% below industry average
Cash Conversion Cycle (days):
96.3
Cash conversion cycle is 103.67% above industry average
The remaining useful life of property plant & equipment is: 7.6 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
325.9K
Each employee generates -46% less revenue than industry average revenue per employee
EBITDA generated per employee:
23.4K
Each employee generates -38% less EBITDA than industry average revenue per employee
Profit generated per employee:
11.0K
Each employee generates -1787% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 0.6K
Each employee generates -91% less free cash flow than industry average revenue per employee
Assets/Capital per employee
186.5K
Each employee generates -91% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
PWR
HOWMET AEROSPACE INC. (XNYS:HWM)
MASCO CORPORATION (XNYS:MAS)
China Southern Airlines Company Limited (XNYS:ZNH)
China Eastern Airlines Corporation Limited (XNYS:CEA)
KSU-P
TREX COMPANY, INC. (XNYS:TREX)
A. O. SMITH CORPORATION (XNYS:AOS)
TEXTRON INC. (XNYS:TXT)
IDEX CORPORATION (XNYS:IEX)
Current Analyst Ratings
Strong buy�25%
Buy�33%
Hold�8%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
14.24B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
12.11B
2.13B
-
-
1.24B
-
144.01M
1.38B
3.15M
81.15M
337.43M
1.02B
667.31M
481.22M
609.44M
123.75M
481.22M
Statement of Cash Flow
Date:
Period:
-
Differed Income Tax :
-
Stock Based Compensation :
-
Change in Working Capital :
85.09M
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
-
Net Cash Provided by Operating Activities:
85.09M
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
238.26M
-
238.26M
4.33B
94.26M
201.19M
4.87B
2.21B
3.59B
1.69B
-
-
656.13M
8.15B
-
13.02B
1.34B
98.85M
-
800.58M
977.30M
3.22B
3.98B
489.46M
4.66B
-
7.87B
2.00K
3.79B
- 224414.0K
1.57B
March 31, 2022 at 6:00:00 AM
13.50B
5.14B
13.01B
-
4.08B
3.8B
-
-
-
-
-
-
-
-
-
-
-
-
231.89M
85.09M
- 109937.00K
- 24847.00K
Our Proprietary Portfolio Rating
Our Rating:
B
Price Forecast/Expected Price in Next 5 Years of
PWR
2023
2024
2025
2026
2027
$149.51
$160.41
$172.10
$184.65
$198.11