On Tuesday, Truist Securities maintained a positive outlook on MasTec (NYSE:MTZ), reiterating a Buy rating with a price target of $173.00. This aligns with the broader analyst consensus, as InvestingPro data shows 11 analysts have recently revised their earnings expectations upward. The firm's confidence in the company's prospects is based on several growth factors that are anticipated to drive MasTec's performance in the coming years.
According to Truist Securities, MasTec is poised to benefit from ongoing growth in various sectors. With a market capitalization of $10.4 billion and trailing twelve-month revenue of $12.2 billion, the company is expected to see double-digit growth in revenues due to increased activity in utility transmission and distribution, renewable energy, data centers, and communications.
This growth is supported by the secular trends that are driving demand in these industries. InvestingPro analysis reveals the company has maintained a strong 12% revenue CAGR over the past five years. The analyst also noted that while the Oil and Gas sector is currently subdued, there is potential for a rebound post-2025. This optimism is based on prospective investments in gas-fired power plants and LNG, which could lead to a resurgence in this market segment for MasTec.
Truist Securities further highlighted MasTec's healthy margins and the company's ability to improve them. The firm also pointed to MasTec's earnings visibility leading into 2025 as above average. This outlook is bolstered by large contracts recently awarded in Power Delivery and gains in market share with key customers in the Communications sector.
Despite the stock's significant appreciation this year, with MasTec shares climbing 77% year-to-date compared to the S&P 500's 28% increase, Truist Securities sees further upside. The current trading valuation of MasTec at approximately 11 times forward EV/EBITDA represents a discount compared to peers, suggesting additional room for growth in the stock's price. The $173.00 price target set by Truist Securities indicates a 29% potential upside from current levels.
In other recent news, MasTec, a leading infrastructure construction company, has been upgraded from a Hold to a Buy rating by Truist Securities, which also increased the company's price target from $133.00 to $173.00. This change comes after a strong Q3 performance, with revenues reaching $3.3 billion and an adjusted EBITDA of $306 million. The company also raised its full-year revenue projection to $12.225 billion and adjusted EPS estimates to $3.75.
In addition to Truist, TD (TSX:TD) Cowen and DA Davidson also raised their price targets for MasTec to $160, maintaining a Buy rating. Baird adjusted its price target to $153, retaining a Neutral rating.
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