Shares of MasTec (MTZ) have been strong performers lately, with the stock up 9.1% over the past month. The stock hit a new 52-week high of $167.03 in the previous session. MasTec has gained 22.2% since the start of the year compared to the -2.3% move for the Zacks Construction sector and the 9% return for the Zacks Building Products - Heavy Construction industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on May 1, 2025, MasTec reported EPS of $.51 versus consensus estimate of $.34 while it beat the consensus revenue estimate by 4.73%.
For the current fiscal year, MasTec is expected to post earnings of $6.07 per share on $13.66 billion in revenues. This represents a 53.67% change in EPS on a 11.03% change in revenues. For the next fiscal year, the company is expected to earn $7.1 per share on $14.79 billion in revenues. This represents a year-over-year change of 16.97% and 8.3%, respectively.
Valuation Metrics
Though MasTec has recently hit a 52-week high, what is next for MasTec? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). The individual style scores for Value, Growth, Momentum and the combined VGM Score run from A through F. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
MasTec has a Value Score of C. The stock's Growth and Momentum Scores are A and F, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 27.4X current fiscal year EPS estimates, which is a premium to the peer industry average of 21X. On a trailing cash flow basis, the stock currently trades at 16.6X versus its peer group's average of 12.7X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this is even more important than the company's VGM Score. Fortunately, MasTec currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if MasTec fits the bill. Thus, it seems as though MasTec shares could have a bit more room to run in the near term.
How Does MTZ Stack Up to the Competition?
Shares of MTZ have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Primoris Services Corporation (PRIM). PRIM has a Zacks Rank of #2 (Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of F.
Earnings were strong last quarter. Primoris Services Corporation beat our consensus estimate by 36.11%, and for the current fiscal year, PRIM is expected to post earnings of $4.44 per share on revenue of $6.73 billion.
Shares of Primoris Services Corporation have gained 7.3% over the past month, and currently trade at a forward P/E of 17.16X and a P/CF of 13.83X.
The Building Products - Heavy Construction industry is in the top 2% of all the industries we have in our universe, so it looks like there are some nice tailwinds for MTZ and PRIM, even beyond their own solid fundamental situation.
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MasTec, Inc. (MTZ): Free Stock Analysis Report Primoris Services Corporation (PRIM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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