It has been about a month since the last earnings report for Dycom Industries (DY). Shares have added about 3.3% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Dycom Industries due for a pullback? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent drivers for Dycom Industries, Inc. before we dive into how investors and analysts have reacted as of late.
Dycom Q2 Earnings Beat Estimates, Revenues Miss
Dycom Industries Inc. reported mixed results in second-quarter fiscal 2026 (ended July 26, 2025) with quarterly earnings surpassing the Zacks Consensus Estimate and also increasing on a year-over-year basis. Meanwhile, contract revenues missed the consensus estimate but increased year over year.
In the fiscal second quarter, the company delivered strong results, supported by record revenues, EBITDA and EPS. Fiber-to-the-home initiatives, wireless activities, maintenance services and early contributions from infrastructure projects tied to hyperscalers were the key drivers of growth. Cash flow improved as DSOs decreased by nine days, and the backlog increased significantly over the next 12 months, increasing by more than 20% year over year.
DY’s Q2 Earnings & Revenue Discussion
Dycom reported adjusted earnings per share (EPS) of $3.33, beating the Zacks Consensus Estimate of $2.86 by 16.4% and increasing 35.4% from $2.46 year over year. The upside was attributable to improved operating leverage.
Contract revenues of $1.378 billion missed the consensus mark of $1.396 billion by 1.3% but rose 14.5% year over year. Contract revenues increased 3.4% on an organic basis. Acquisitions contributed $139.8 million to contract revenues.
Operations & Backlog Details
Adjusted EBITDA increased 29.8% to $205.5 million from a year ago.
Adjusted EBITDA margin of 14.9% expanded 175 basis points from the year-ago level.
Dycom’s backlog at the end of the fiscal second quarter totaled $7.989 billion, representing a year-over-year increase of 16.9% from a year ago. Of the backlog, $4.604 billion is projected to be completed in the next 12 months.
Financials
As of July 26, 2025, DY had liquidity of $545.9 million, including cash and cash equivalents worth $28.5 million, compared with $92.6 million as of Jan. 25, 2025. Long-term debt was $1.01 billion at the fiscal second-quarter end, up from $933.2 million at the fiscal 2025 end.
During the first two quarters of fiscal 2026, DY repurchased 200,000 shares of its common stock for $30.2 million at an average price of $150.93 per share.
Dycom’s Q3 View
For the fiscal third quarter (ending on Oct. 25, 2025), DY expects $1.38 to $1.43 billion of contract revenues for the quarter.
The adjusted EBITDA is expected to be between $198 million and $213 million. For the said period, Dycom expects the effective tax rate to be 26% and diluted shares of 29.3 million. Interest expenses, net, are likely to be $14.7 million and amortization expenses to be $11.8 million.
FY26 Guidance by Dycom
Dycom expects total contract revenues for fiscal 2026 to range from $5.290 billion to $5.425 billion, representing a 12.5% to 15.4% year-over-year increase, driven by robust digital infrastructure growth and long-term demand drivers.
Service and maintenance provide a steady stream of income, and management is certain that margins will continue to grow and operational efficiency will improve.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in estimates review.
VGM Scores
At this time, Dycom Industries has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Dycom Industries has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Dycom Industries, Inc. (DY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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