PWR Quanta Services Inc

Quanta Services provides specialty contracting services for the construction and maintenance of electric power infrastructure, oil and gas pipelines, and telecom networks. Sector: Industrials.

Quanta Services Inc (PWR) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

Assessing the quality of returns on invested capital, ROIC is 7.86%, WACC is 10.69%, and the economic spread is -2.83%. On balance, the company is not clearing their capital cost hurdle, meaning reinvestment may be diluting rather than compounding value. Supporting metrics show ROE at 13.39% and ROA at 4.81%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company that likely needs operating improvement before returns quality can be considered durable.

The current pricing of the company reads trailing P/E of 97.70, forward P/E of 50.08, PEG of 2.80. A meaningful compression from trailing to forward P/E implies analysts are projecting earnings growth that could re-rate the company favorably if delivered. The PEG reading here is above the range most value-oriented investors would find comfortable — the valuation requires a high degree of confidence in forward earnings delivery. The current ratio of 1.14 is below average, suggesting some the company may face tighter short-term financial conditions. In aggregate, the valuation reads as fair to moderately stretched — leaving the investment case dependent on earnings execution rather than multiple expansion.

Looking at margins from gross to free cash flow, gross margin sits at 15.10%, operating margin at 5.61%, and free cash flow margin at 5.41%. The gross margin reading is low, suggesting the company operate in cost-intensive or highly competitive environments. Modest operating margins indicate that while revenues are being generated, converting them to earnings is less efficient. The company's cash conversion is middle-of-the-road — sufficient for operational needs, but leaving limited surplus for discretionary allocation. Margins indicate a company that is operating effectively in some areas while still showing efficiency gaps in others.

Projected 12-month EPS growth of 95.1% adds a powerful forward signal — analyst consensus expects earnings to accelerate materially, which, if delivered, could make current multiples look increasingly modest. Zooming out from the valuation discussion, TTM revenue growth of 26.33% pointing to sustained and broad-based revenue growth within the company, while the estimated 12-month price change of -2.02%, where the target profile indicates a negative expected price trajectory. Anchoring to reported revenues provides discipline; analyst price targets add context about how the market currently values that operating reality. The path to realizing analyst-implied returns runs through revenue execution, margin stability, and a macro environment that doesn't undermine either. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

Taken as a whole, the profile carries enough risk factors to suggest the margin of safety is thin at current levels — caution is advisable until the fundamental picture improves.

This summary is based on publicly available quantitative data and is not intended as investment advice. Carefully consider your personal financial circumstances before making any decisions.