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If You Invested $1000 in Quanta Services a Decade Ago, This is How Much It'd Be Worth Now

Zacks Equity Research
·3-min read

How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.

The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.

What if you'd invested in Quanta Services (PWR) ten years ago? It may not have been easy to hold on to PWR for all that time, but if you did, how much would your investment be worth today?

Quanta Services' Business In-Depth

With that in mind, let's take a look at Quanta Services' main business drivers.

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Quanta is a leading national provider of specialty contracting services, and one of the largest contractors serving the transmission and distribution sector of the North American electric utility industry. Quanta has operations in the United States, Canada, Australia and other selected international markets.

Starting from fourth-quarter 2021, Quanta reports results under three reportable segments: Electric Power Infrastructure Solutions, Underground Utility and Infrastructure Solutions, and Renewable Energy Infrastructure Solutions.

The Electric Power Infrastructure Solutions segment (accounting for 58.7% of 2021 revenues) provides network solutions to customers in the electric power industry. Services performed include design, installation, upgrade, repair and maintenance of electric power transmission and distribution networks, and sub-station facilities; emergency restoration services; installation of “smart grid” technology on electric power networks; and communications infrastructure services.

The Underground Utility and Infrastructure Solutions segment (14.1%) provides solutions to customers involved in the transportation of natural gas, oil and other pipeline products. Services include design, installation, repair and maintenance of oil and gas transmission and distribution systems, and related trenching and directional boring services. Also, this segment provides pipeline protection services, high-pressure and critical-path turnaround services to the downstream and midstream energy markets.

Renewable Energy Infrastructure Solutions segment (27.2%) provides infrastructure solutions to clients involved in the renewable energy and/or related infrastructure. This segment provides services related to engineering, procurement, new construction, upgrade, and repair and maintenance of utility-scale wind, solar and hydropower generation facilities as well as battery storage facilities.

Bottom Line

While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Quanta Services ten years ago, you're probably feeling pretty good about your investment today.

A $1000 investment made in January 2013 would be worth $5,120.31, or a gain of 412.03%, as of January 25, 2023, according to our calculations. This return excludes dividends but includes price appreciation.

In comparison, the S&P 500 gained 168.72% and the price of gold went up 12.22% over the same time frame.

Looking ahead, analysts are expecting more upside for PWR.

Quanta's shares have outperformed the industry this year. The company has been witnessing notable revenue growth in each segments. It witnessed a solid total backlog of $20.87 billion in the third quarter. The company remains uniquely positioned to capitalize on megatrends and opportunities to lead the energy transition and enable technological development, with initiatives such as electric vehicle charging infrastructure and undergrounding of electrical infrastructure gaining momentum. More demand for infrastructure solutions that help support customers' energy-transition initiatives and modernization will continue to provide multi-year growth opportunities for Quanta. However, lower operating margins, regulatory challenges and project delays are potential headwinds.

The stock is up 5.24% over the past four weeks, and no earnings estimate has gone lower in the past two months, compared to 1 higher, for fiscal 2022. The consensus estimate has moved up as well.

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Zacks Investment Research