Investment Thesis
Quanta Services demonstrates strong fundamental growth with 20.3% revenue expansion and robust cash generation ($1.6B FCF), supported by excellent operational efficiency and balance sheet strength. However, thin margins (3.6% net margin) and moderate profitability ratios (11.5% ROE, 4.1% ROA) suggest limited earnings leverage relative to revenue growth, indicating this is a volume-dependent business in a capital-intensive sector.
PWR Strengths
- Strong revenue growth of 20.3% YoY indicating robust market demand in electrical infrastructure
- Excellent free cash flow generation ($1.6B) with healthy 5.7% FCF margin demonstrating cash conversion quality
- Solid balance sheet with conservative 0.59x debt-to-equity and exceptional 39.2x interest coverage ratio
- Healthy current and quick ratios (1.14x and 1.09x) indicating adequate short-term liquidity
- Flat net income growth despite 20.3% revenue growth suggests operational improvements offsetting cost pressures
PWR Risks
- Compressed profitability margins (3.6% net margin, 5.7% operating margin) are thin for a services company and vulnerable to cost inflation or pricing pressure
- Modest return metrics (11.5% ROE, 4.1% ROA) suggest capital is not generating exceptional returns relative to book value and asset base
- Significant insider activity (18 Form 4 filings in 90 days) warrants monitoring for potential insider concerns
- Capital-intensive business model with $609M CapEx annually limits financial flexibility
- Divergence between strong revenue growth and flat earnings growth indicates margin compression or operational headwinds
Key Metrics to Watch
- Net margin and operating margin trends - critical to confirm earnings growth can accelerate with revenue
- Return on equity trajectory - monitor if capital deployment improvements drive better returns
- Operating cash flow sustainability - ensure free cash flow generation persists as business scales
- Debt levels and leverage ratios - track if growth is funded prudently without excessive leverage
- Gross margin stability - indicate pricing power and cost management in a competitive market
PWR Financial Metrics
PWR Profitability Ratios
PWR Balance Sheet & Liquidity
PWR 5-Year Financial Trend
5-Year Trend Summary: QUANTA SERVICES, INC.'s revenue has grown significantly by 119% over the 5-year period, indicating strong business expansion. The most recent EPS of $5.00 reflects profitable operations.
PWR Growth Metrics (YoY)
PWR Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $6.5B | $293.2M | $1.95 |
| Q2 2025 | $5.6B | $188.2M | $1.26 |
| Q1 2025 | $5.0B | $118.4M | $0.79 |
| Q3 2024 | $5.6B | $272.8M | $1.83 |
| Q2 2024 | $5.0B | $165.9M | $1.12 |
| Q1 2024 | $4.4B | $95.0M | $0.64 |
| Q3 2023 | $4.5B | $156.0M | $1.06 |
| Q2 2023 | $4.2B | $88.0M | $0.59 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
PWR Capital Allocation
PWR SEC Filings
Access official SEC EDGAR filings for QUANTA SERVICES, INC. (CIK: 0001050915)