Financial Review: Quanta Services (PWR) & Granite Construction (GVA)

Quanta Services (NYSE: PWR) and Granite Construction (NYSE:GVA) are both mid-cap construction companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, valuation, earnings, profitability, institutional ownership and dividends.

Profitability

This table compares Quanta Services and Granite Construction’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Quanta Services 3.21% 8.36% 5.11%
Granite Construction 1.61% 4.80% 2.49%

Risk & Volatility

Quanta Services has a beta of 0.83, indicating that its stock price is 17% less volatile than the S&P 500. Comparatively, Granite Construction has a beta of 1.17, indicating that its stock price is 17% more volatile than the S&P 500.

Dividends

Granite Construction pays an annual dividend of $0.52 per share and has a dividend yield of 0.9%. Quanta Services does not pay a dividend. Granite Construction pays out 48.6% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares Quanta Services and Granite Construction’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Quanta Services $8.52 billion 0.67 $655.04 million $1.77 21.19
Granite Construction $2.70 billion 0.86 $126.96 million $1.07 54.57

Quanta Services has higher revenue and earnings than Granite Construction. Quanta Services is trading at a lower price-to-earnings ratio than Granite Construction, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

88.5% of Quanta Services shares are held by institutional investors. Comparatively, 98.5% of Granite Construction shares are held by institutional investors. 0.7% of Quanta Services shares are held by company insiders. Comparatively, 1.3% of Granite Construction shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Quanta Services and Granite Construction, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Quanta Services 0 2 8 0 2.80
Granite Construction 0 2 6 0 2.75

Quanta Services currently has a consensus target price of $42.50, indicating a potential upside of 13.33%. Granite Construction has a consensus target price of $63.71, indicating a potential upside of 9.12%. Given Quanta Services’ stronger consensus rating and higher possible upside, analysts plainly believe Quanta Services is more favorable than Granite Construction.

Summary

Quanta Services beats Granite Construction on 10 of the 16 factors compared between the two stocks.

About Quanta Services

Quanta Services, Inc. is a provider of specialty contracting services, offering infrastructure solutions primarily to the electric power and oil and gas industries in the United States, Canada and Australia and selected other international markets. The Company operates through two segments: Electric Power Infrastructure Services, which provides network solutions to customers in the electric power industry, and Oil and Gas Infrastructure Services, which provides network solutions to customers involved in the development and transportation of natural gas, oil and other pipeline products. The services it provides include the design, installation, upgrade, repair and maintenance of infrastructure within each of the industries it serves, such as electric power transmission and distribution networks, substation facilities, renewable energy facilities, pipeline transmission and distribution systems and facilities, and infrastructure services for the offshore and inland water energy markets.

About Granite Construction

Granite Construction Incorporated is a heavy civil contractor and construction materials producer in the United States. The Company operates through three segments: Construction, Large Project Construction and Construction Materials. The Company operates across the nation, serving both public and private sector clients. Within the public sector, it concentrates on heavy-civil infrastructure projects, including the construction of streets, roads, highways, mass transit facilities, airport infrastructure, bridges, trenchless and underground utilities, power-related facilities, water and wastewater facilities, utilities, tunnels, dams and other infrastructure-related projects. Within the private sector, the Company offers site preparation and infrastructure services for residential development, energy development, commercial and industrial sites, and other facilities, as well as provides construction management professional services.

Receive News & Ratings for Quanta Services Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Quanta Services Inc. and related companies with MarketBeat.com's FREE daily email newsletter.

Latest News

Leave a Reply