Analyzing Quanta Services (PWR) and Chicago Bridge & Iron (CBI)
Quanta Services (NYSE: PWR) and Chicago Bridge & Iron (NYSE:CBI) are both construction companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, earnings, risk, profitability and dividends.
Chicago Bridge & Iron pays an annual dividend of $0.28 per share and has a dividend yield of 2.4%. Quanta Services does not pay a dividend. Chicago Bridge & Iron pays out -3.0% of its earnings in the form of a dividend.
Risk and Volatility
Quanta Services has a beta of 0.84, suggesting that its stock price is 16% less volatile than the S&P 500. Comparatively, Chicago Bridge & Iron has a beta of 2.02, suggesting that its stock price is 102% more volatile than the S&P 500.
This is a summary of current recommendations for Quanta Services and Chicago Bridge & Iron, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Chicago Bridge & Iron||2||7||5||0||2.21|
Quanta Services currently has a consensus price target of $42.00, indicating a potential upside of 19.12%. Chicago Bridge & Iron has a consensus price target of $22.57, indicating a potential upside of 89.68%. Given Chicago Bridge & Iron’s higher possible upside, analysts plainly believe Chicago Bridge & Iron is more favorable than Quanta Services.
Earnings & Valuation
This table compares Quanta Services and Chicago Bridge & Iron’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Quanta Services||$8.52 billion||0.63||$655.04 million||$1.77||19.92|
|Chicago Bridge & Iron||$9.49 billion||0.13||$9.27 million||($9.43)||-1.26|
Quanta Services has higher revenue, but lower earnings than Chicago Bridge & Iron. Chicago Bridge & Iron is trading at a lower price-to-earnings ratio than Quanta Services, indicating that it is currently the more affordable of the two stocks.
This table compares Quanta Services and Chicago Bridge & Iron’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Chicago Bridge & Iron||-23.50%||-96.47%||-15.91%|
Institutional and Insider Ownership
88.6% of Quanta Services shares are held by institutional investors. Comparatively, 63.8% of Chicago Bridge & Iron shares are held by institutional investors. 0.7% of Quanta Services shares are held by company insiders. Comparatively, 1.1% of Chicago Bridge & Iron shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Quanta Services beats Chicago Bridge & Iron on 9 of the 15 factors compared between the two stocks.
About Quanta Services
Quanta Services, Inc. is a provider of specialty contracting services, offering infrastructure solutions primarily to the electric power and oil and gas industries in the United States, Canada and Australia and selected other international markets. The Company operates through two segments: Electric Power Infrastructure Services, which provides network solutions to customers in the electric power industry, and Oil and Gas Infrastructure Services, which provides network solutions to customers involved in the development and transportation of natural gas, oil and other pipeline products. The services it provides include the design, installation, upgrade, repair and maintenance of infrastructure within each of the industries it serves, such as electric power transmission and distribution networks, substation facilities, renewable energy facilities, pipeline transmission and distribution systems and facilities, and infrastructure services for the offshore and inland water energy markets.
About Chicago Bridge & Iron
Chicago Bridge & Iron Company N.V. provides services to customers in energy infrastructure market. The Company provides services, such as conceptual design, technology, engineering, procurement, fabrication, modularization, construction, commissioning, maintenance, program management and environmental services. Its Engineering and Construction segment provides engineering, procurement, and construction (EPC) services. Its Fabrication Services segment provides fabrication and erection of steel plate structures; fabrication of piping systems and process modules, and manufacturing and distribution of pipe and fittings. The Technology segment provides process technology licenses and associated engineering services, and catalysts, for petrochemical and refining industries, and offers process planning and project development services.
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