After powering two quarters of accelerating growth, energy and communications infrastructure leader Quanta Services aims to generate a new breakout. Showing strong institutional demand, PWR stock joins industry peers KBR, Jacobs Engineering and Great Lakes Dredge & Dock on the latest list of new buys by the best mutual funds.
Further confirming demand, 79 funds with an A+ rating from IBD have reported owning PWR stock. Plus, the company has posted three quarters of rising fund ownership. The number of funds owning shares has risen from 1,172 in second quarter of last year to 1,284 in Q1.
Quanta has also earned a spot on IBD Leaderboard watchlist and Stock Spotlight, one of IBD's premiere stock lists. With a 99 Composite Rating, it holds the No. 1 ranking among its peers in its industry group. The 99 rating means Quanta is outpacing 99% of all stocks — both in and outside of its industry — in terms of key stock-picking traits.
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Quanta Powers Accelerating Growth
Quanta powers infrastructure services for the energy and communications industries, with operations throughout the U.S., Canada, Australia and other international markets. Involved in areas ranging from utilities, pipelines and telecom, Quanta's comprehensive services include designing, installing, repairing and maintaining energy and communications infrastructure.
Quanta also recently announced a new Renewable Energy segment, which includes services for solar and wind projects.
On May 5, the company posted 65% earnings growth, marking a second quarter of acceleration. When Quanta next reports in early August, analysts forecast a 45% EPS increase, with expectations of a 28% rise for the year.
Sales have also been on the rise, ranging from 11% to 47% over the last three quarters.
PWR Stock Energizes Base With Boost From Infrastructure Bill
Quanta is looking to complete an imperfect cup with handle. Having reclaimed its 50-day moving average, the stock is now aiming for a 138.56 buy point in a first-stage base. The handle is deeper than normal, which is the imperfection in the pattern.
In general, Quanta's disciplined moves during this year's bear market and volatility have impressed, with its relative strength line right around a new high.
Since falling below its 200-day line earlier this month, PWR stock has been on the rise. Quanta is now 8% below the buy point with the stock market indexes back in an uptrend.
Follow Matthew Galgani on Twitter at @IBD_MGalgani.
