QUANTA SERVICES INC (NYSE:PWR) shows strong growth, high ROIC, and solid cash flow, making it a candidate for quality investors despite its premium valuation.
Large-cap stocks usually command their industries because they have the scale to drive market trends.
The flip side though is that their sheer size can limit growth as expanding further becomes an increasingly challenging task.
Quanta currently trades at $356.79 and has been a dream stock for shareholders. It’s returned 830% since June 2020, blowing past the S&P 500’s 91.2% gain. The company has also beaten the index over the past six months as its stock price is up 11.3% thanks to its solid quarterly results.
The S&P 500 (^GSPC) is home to the biggest and most well-known companies in the market, making it a go-to index for investors seeking stability.
But not all large-cap stocks are created equal - some are struggling with slowing growth, declining margins, or increased competition.
Market swings can be tough to stomach, and volatile stocks often experience exaggerated moves in both directions.
While many thrive during risk-on environments, many also struggle to maintain investor confidence when the ride gets bumpy.
While strong cash flow is a key indicator of stability, it doesn’t always translate to superior returns.
Some cash-heavy businesses struggle with inefficient spending, slowing demand, or weak competitive positioning.
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QUANTA SERVICES INC (NYSE:PWR) is a quality stock with strong revenue growth, high ROIC, and solid cash flow conversion, making it a candidate for long-term investors.
Infrastructure solutions provider Quanta (NYSE:PWR) reported Q1 CY2025 results topping the market’s revenue expectations, with sales up 23.9% year on year to $6.23 billion. The company expects the full year’s revenue to be around $26.95 billion, close to analysts’ estimates. Its non-GAAP profit of $1.78 per share was 6.9% above analysts’ consensus estimates.
