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Jefferies set its price target for the company at $760. This is significantly higher than the current stock price, though it sits slightly below the average analyst target of $792. This move reflects a general optimism among analysts following the company's recent record results and raised outlook. While a target price is just an estimate of where the stock might trade in the future, the gap between this target and the current price suggests analysts believe the company's role in building out the power grid for AI data centers is not yet fully reflected in the stock price.
Source: Jefferies
After Quanta Services reported its October results, we raised our revenue and profit projections for the next two years. We have added the company's move into manufacturing its own steel power poles to what we track. We also increased our assumption for how much work is already signed and waiting to be done to $63.7 billion. Finally, we updated our view of the business to reflect that the power grid division now accounts for 82% of all sales.
Truist Financial set a new price target of $960 for the company on Tuesday. This is much higher than the average analyst target of $804 and well above where the stock currently trades. While the firm did not change its overall rating, the high target reflects confidence in the company's ability to capitalize on the massive demand for power grid upgrades and data center connections.
Source: Truist Financial
Quanta reported third-quarter profit of $6.06 per share, which was well above the $5.02 analysts expected. Revenue reached $12.01 billion, driven by record demand for its specialized labor and equipment used to build and upgrade power grids. The stock rose about 7 percent following the report.
The most important number for the company's future is its backlog, which represents the total value of signed contracts it has yet to complete. That backlog reached a record $63.7 billion this quarter. This suggests that utility companies are continuing to spend heavily on the grid to support new data centers and renewable energy projects, which provides Quanta with years of visible work ahead. Management raised its financial expectations for the rest of the year across every major metric. While the stock price has risen significantly this year, the business is proving it can convert high demand into actual cash flow, reporting $1.2 billion in free cash flow this quarter alone.
See the full quarter, and how our tracked metrics did
Source: 8-K filing
Goldman Sachs lowered its price target for Quanta Services to $781 on Thursday, down from a previous target of $902. This move comes just a week before the company is set to report its latest quarterly results. Even with the lower target, the firm's outlook remains well above the current stock price of roughly $549. While the target cut is notable, it does not change the firm's overall rating on the stock. Other analysts have also been adjusting their expectations recently, bringing the average target across all firms to about $801. For long-term owners, these shifts often reflect short-term market pricing rather than a change in the company's ability to build and modernize the power grid.
Source: Goldman Sachs
Management is consistently outrunning its own forecasts. Eight straight quarters of beats show a business growing faster than even the leaders can keep up with.
| Expectation | |
|---|---|
| EPS | $5.14 |
| Revenue | $11.96B |
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