Key Stats for Quanta Services Stock
- Current Price: $643.50
- Target Price (Mid): ~$1,020
- Street Target (Mean): ~$770
- Potential Total Return: ~59%
- Annualized IRR: ~11% / year
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What Happened?
Quanta Services (PWR) won a Bernstein upgrade on September 24 that pairs a valuation call with an argument about people rather than power. Analyst Chad Dillard moved the stock to Outperform from Market Perform and raised his target to $775 from $748, arguing that the AI construction bottleneck is shifting from megawatts to manpower. Shares rose 1.35% that day to $643.50.
The upgrade followed an 11.8% slide from the June 30 close of $720.04 to $634.90 on September 23, even though Quanta’s July 30 results, detailed in its investor relations materials, raised its 2026 outlook. TIKR’s drawdown data shows the shares bottomed on July 29, the day before that report, and recovered about 15% through September 24, leaving them up 52.5% in 2026. The open issue is whether a labor advantage can support a stock priced at about 35 times forward earnings.
Quanta Is Planning Crews Five to Seven Years Out
Quanta’s July 30 earnings call supports Bernstein’s thesis. Asked how far ahead customers secure its craft labor, Earl “Duke” Austin, Quanta’s President and CEO, said Quanta is “as far out as their capital plans at least and beyond,” plans that run five to seven years. He added, “we see decade-plus type arrangements out there.”
Jefferies analyst Julien Dumoulin-Smith said a large Midwest utility is electing to self-perform a gas generation RFP, citing inadequate resources, and Austin replied, “Yes, it sounds easy. It’s not.” He also said Quanta is “not willing to take the risk on the combined cycle side” without contracts it is comfortable with.
“It takes about 4 years to make a craftsman and a journeyman,” Austin said, adding that Quanta spends about $250 million a year on training. He said Quanta has added about 15,000 employees “in the year,” “well over 7,000” of them through organic growth, and that “we’re nowhere near capacity.”
Dillard’s own questions on the call went to how Quanta stretches each worker. Austin said acquisitions completed in the second quarter and July added about 0.5 million square feet to roughly 7 million square feet of fabrication space, where indoor work takes “less people to some degree, depending on where you’re at in your logistics.” On 800-volt data center power, he said those RFPs haven’t shown up yet, but “the higher the voltage, the better for Quanta.”
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Bernstein’s $775 Target Sits Near Consensus After a 30% De-Rating
Quanta’s forward P/E ratio fell from about 50x on June 30 to about 35x on September 24, while TIKR’s next-twelve-month EPS estimate rose about 27%, partly because the forecast window rolled ahead a quarter. After Quanta raised 2026 revenue guidance to $39.3 billion to $39.7 billion, analysts made upward revisions that lifted their 2026 revenue forecast about 13%, to around $39.6 billion.
At about 35x, Quanta still trades above Comfort Systems USA at about 31x forward earnings, EMCOR at about 22x, and MasTec at about 19x. That premium rests on consensus forecasts of around 36% annual EPS growth over the next two years and on $33.6 billion of remaining performance obligations (contracted work not yet recognized as revenue) as of June 30, per Quanta’s second-quarter results filed with the SEC.
Bernstein’s $775 target implies about 20% upside from the September 24 close, near the Street mean of around $770 and below the median of around $800. As of September 24, TIKR lists 24 Buy, 1 Outperform, 5 Hold, 2 No Opinion, 1 Underperform, and no Sell ratings, so the upgrade moves Bernstein toward the crowd rather than ahead of it.
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TIKR Advanced Model Analysis
- Current Price: $643.50
- Target Price (Mid): ~$1,020
- Potential Total Return: ~59%
- Annualized IRR: ~11% / year
- Revenue CAGR (Mid): ~13%
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This analysis uses the mid case because it assumes a slightly lower P/E each year, so the target doesn’t depend on the multiple recovering to June’s level. Revenue growth rests on utility transmission and generation programs that Austin says are planned years ahead, plus technology work he put at 15% to 20% of the business. Labor utilization drives the margin path: Austin said Quanta can move electricians and underground crews across data center, industrial, and gas work, though it is also “training a lot of people.”
The primary risk is that demand for that labor softens. ROTH analyst Philip Shen said on the call that his firm sees as many as 10 more states possibly pursuing data center bans or pauses by the end of 2026. CFO Jayshree Desai said Quanta books that work cautiously, starting with early authorizations called limited notices to proceed (LNTPs): “we tend to put in things that have only LNTPs, and we don’t put the rest of it until the project is a go.”
Over the model’s full horizon to December 2034, the high case works out to around 14% a year, against around 10% for the mid case. On the downside, the low case still returns around 6% a year. Analyst price targets typically look about 12 months out, which helps explain why they sit well below the model’s 2030 figure.
Conclusion
As of September 25, Quanta had not announced its third-quarter report date, and data providers expect it on October 28 or 29. Consensus calls for revenue of around $10.9 billion, about 42% above the same quarter last year, and revenue is where labor capacity shows up first.
A beat, alongside the NiSource work Austin expects to book in the quarter, would support Bernstein’s view that Quanta can staff the buildout. A miss would suggest crews are a constraint for Quanta too, and at about 35 times forward earnings, the multiple would likely absorb that first.
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Should You Invest in Quanta Services?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
