MasTec (MTZ) In A Perilous Reversal

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified MasTec ( MTZ) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified MasTec as such a stock due to the following factors:

  • MTZ has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $27.7 million.
  • MTZ has traded 304,554 shares today.
  • MTZ is down 3% today.
  • MTZ was up 8.2% yesterday.

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More details on MTZ:

MasTec, Inc., an infrastructure construction company, provides engineering, building, installation, maintenance, and upgrade services for energy, utility, and communications infrastructure primarily in the United States. MTZ has a PE ratio of 16.6. Currently there are 8 analysts that rate MasTec a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for MasTec has been 1.0 million shares per day over the past 30 days. MasTec has a market cap of $2.2 billion and is part of the industrial goods sector and materials & construction industry. The stock has a beta of 1.08 and a short float of 14.4% with 9.02 days to cover. Shares are down 12.5% year-to-date as of the close of trading on Friday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates MasTec as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and reasonable valuation levels. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 13.7%. Since the same quarter one year prior, revenues rose by 13.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has significantly increased by 538.94% to $75.71 million when compared to the same quarter last year. In addition, MASTEC INC has also vastly surpassed the industry average cash flow growth rate of -78.00%.
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Construction & Engineering industry average, but is less than that of the S&P 500. The net income has decreased by 8.3% when compared to the same quarter one year ago, dropping from $34.94 million to $32.05 million.
  • MASTEC INC's earnings per share declined by 11.9% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, MASTEC INC increased its bottom line by earning $1.74 versus $1.43 in the prior year. For the next year, the market is expecting a contraction of 10.1% in earnings ($1.57 versus $1.74).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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