Quanta Services Inc. (PWR): Today's Featured Materials & Construction Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Quanta Services ( PWR) pushed the Materials & Construction industry lower today making it today's featured Materials & Construction laggard. The industry as a whole closed the day up 1.6%. By the end of trading, Quanta Services fell 26 cents (-1.1%) to $24.24 on average volume. Throughout the day, 2.2 million shares of Quanta Services exchanged hands as compared to its average daily volume of 1.6 million shares. The stock ranged in price between $24.16-$24.62 after having opened the day at $24.57 as compared to the previous trading day's close of $24.50. Other companies within the Materials & Construction industry that declined today were: Heritage-Crystal Clean ( HCCI), down 5.1%, McDermott International ( MDR), down 3.9%, Perma-Fix Environmental Services ( PESI), down 2.8%, and Pope Resources ( POPE), down 2.3%.
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Quanta Services, Inc. provides specialty contracting services primarily in North America. Quanta Services has a market cap of $5.04 billion and is part of the industrial goods sector. The company has a P/E ratio of 22.5, above the average materials & construction industry P/E ratio of 22.1 and above the S&P 500 P/E ratio of 17.7. Shares are up 13.7% year to date as of the close of trading on Tuesday. Currently there are 11 analysts that rate Quanta Services a buy, no analysts rate it a sell, and three rate it a hold.

TheStreet Ratings rates Quanta Services as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, compelling growth in net income, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company shows low profit margins.

On the positive front, Hovnanian ( HOV), up 9.3%, KB Home ( KBH), up 8.6%, US Concrete ( USCR), up 7.7%, and Headwaters ( HW), up 6%, were all gainers within the materials & construction industry with Republic Services ( RSG) being today's featured materials & construction industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the materials & construction industry could consider SPDR S&P Homebuilders ETF ( XHB) while those bearish on the materials & construction industry could consider ProShares Short Basic Materials Fd ( SBM).

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