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Bull’s Eye Report: Quanta Services (PWR)

PWR is rated as a top buy at current levels


At, we strive to “own the best and ignore the rest” in our equity portfolios. Toward this end, each day we search our database for a “top stock” (a top rated company in terms of earnings strength as well as company and industry performance) that presents a strong technical “set up” and a good entry point.

In short, when our equity team is looking to add a stock to one of our portfolios, the “bull’s eye” stock shown below is generally their first choice.

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Company Symbol Industry Stock Rating YTD% Gain S.T.
Stop Loss
Quanta Services Inc PWR Construction & Engineering 9.6 +1.85% $27.58

Quanta Services (NYSE: PWR) is our most compelling buy today due to the fact that it is a “top-rated stock” (in terms of earnings strength and company/industry performance) in a very strong sub-industry, construction and engineering. Along with other construction and engineering stocks like Dycom Industries (NYSE:DY), The Shaw Group (NYSE:SHAW), URS Corp. (NYSE:URS), and Fluor Corp. (NYSE:FLR), PWR has exhibited considerable strength over the past few months. Since mid-November, Quanta has been firmly uptrending, making higher highs and higher lows along the way. The stock pulls back every month or so, which creates good entry points. Currently, the stock has pulled back from its $30 highs down to around $28.45.

We think PWR is today’s most compelling buy because

  1. Its immediate upside to $30 is a +5.25% gain from current prices, while the stop at $27.58 is only a 3% potential downside.
  2. PWR tends to pop higher immediately after crossing its short-term moving averages (5-day, 10-day).
  3. The stock has not broken below the 50-day moving average on a closing basis since October, which clearly shows it is in a healthy uptrend.

Thus, we recommend PWR at current prices for a short- or intermediate-term trade.

We Would Be Buyers:

At the current price (~$28.45), or on a pullback to the 50-day moving average (~$27.92).

Company Profile:

Quanta Services is a provider of specialty contracting services, offering infrastructure solutions to the electric power, natural gas and oil pipeline and telecommunications industries. 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, natural gas and oil transmission and distribution systems and telecommunications networks used for video, data and voice transmission. The Company also owns fiber optic telecommunications infrastructure in select markets. It operates in four segments: Electric Power Infrastructure Services, Natural Gas and Pipeline Infrastructure Services, Telecommunications Infrastructure Services and Fiber Optic Licensing. On October 5, 2011, the Company completed the acquisition of Utilimap Corporation.

Stock Rating: 9.6

The Stock Rating indicates the combined score of our proprietary Earning Strength and Company Performance models. The rating scale is 0 – 10 with 10 being the highest.

Quanta Services – Last Three Months

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Quanta Services – Last 12 Months

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Quanta Services – Last Five Years

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At the time of publication the editor and affiliated companies own the following positions: None

Note: Positions may be bought or sold while this publication is in circulation without notice.

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