15 Jan, 2010
Quanta Stock Touted By Fortune
The mag just came out with "The Best Stocks in 2010." There are 10 of them -- and Quanta Services is one of them.
I like Quanta. I've spoken with John Colson, The Boss there. I like him. I like the company.
Notes:
a. I won't invest in the company, because I might write about them. I know, it's a dumb rule. Still, it's a rule.
b. Without that rule, I would DEFINITELY buy the stock of Quanta (symbol PWR) --
c. . . . except now that FORTUNE thinks PWR is a buy, I'd . . . definitely, positively, think about changing my mind!
- - - - -
Here's a slice of the FORTUNE bit on Quanta --
Shares fell to $16 in February after utilities delayed spending amid the credit crisis and have since rebounded to $20.
But at 19 times forward earnings, the stock trades well below its five-year average of 27 times earnings, since investors still worry that Quanta's work might be delayed even longer. Analysts predict earnings per share will increase by 30% next year.
The long-term future looks even more promising. In addition to grid spending, which the Brattle Group, a research firm, estimates will total $1.5 trillion to $2 trillion between now and 2030, Quanta will prosper as its transmission lines carry electricity from renewable energy projects like wind and solar farms.
Buoyed by the government's stimulus loan guarantee program for renewable projects, Quanta expects such sales to nearly triple to $300 million in 2010.
CEO John Colson also figures Quanta's recent acquisition of Price Gregory, the country's largest gas pipeline builder, will drive profits in two to three years as natural gas in remote shale formations increasingly needs to be moved across the U.S.
"We haven't been as bullish on the natural-gas market as we are today," he says. "That's going to spur growth over the next several years."
But at 19 times forward earnings, the stock trades well below its five-year average of 27 times earnings, since investors still worry that Quanta's work might be delayed even longer. Analysts predict earnings per share will increase by 30% next year.
The long-term future looks even more promising. In addition to grid spending, which the Brattle Group, a research firm, estimates will total $1.5 trillion to $2 trillion between now and 2030, Quanta will prosper as its transmission lines carry electricity from renewable energy projects like wind and solar farms.
Buoyed by the government's stimulus loan guarantee program for renewable projects, Quanta expects such sales to nearly triple to $300 million in 2010.
CEO John Colson also figures Quanta's recent acquisition of Price Gregory, the country's largest gas pipeline builder, will drive profits in two to three years as natural gas in remote shale formations increasingly needs to be moved across the U.S.
"We haven't been as bullish on the natural-gas market as we are today," he says. "That's going to spur growth over the next several years."
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