Can Quanta Sustain Its 20% EPS Growth Streak Without Mega Projects?

Quanta Services, Inc.’s PWR growth outlook appears increasingly supported by broad-based programmatic spending rather than reliance on large, one-off projects. Management emphasized that 2026 growth expectations are not tied to major transmission megaprojects. Instead, the company anticipates steady expansion driven by ongoing utility grid modernization, rising electricity demand and growing investments tied to data centers and power generation. In 2025, PWR’s revenues rose 20% year over year to $28.5 billion and adjusted EPS increased 20% to $10.75, supported by strong execution across its utility and infrastructure markets.

The company ended 2025 with a record backlog of $43.98 billion, up year over year by 27.3% from $34.54 billion, underscoring robust demand visibility. PWR indicated that data center-related work now accounts for roughly 10% of its business and represents the fastest-growing portion of backlog, reflecting surging electricity demand from Artificial Intelligence and cloud infrastructure.

Notably, strategic acquisitions, including Dynamic Systems, Tri-City Group and Wilson Construction, have expanded Quanta’s capabilities in technology infrastructure, power delivery and fabrication. In 2026, the company expects these acquisitions to contribute approximately 40-50 cents to adjusted EPS. The majority of the financial impact will be reflected within the Electric segment. Moreover, PWR is also investing $500-$700 million in transformer manufacturing and supply-chain capacity, aimed at mitigating industry bottlenecks and improving project execution certainty.

Looking ahead, management expects double-digit revenue and EBITDA growth in 2026 with the potential for more than 20% EPS growth, supported by structural demand across utilities, renewable energy and power generation markets. With diversified revenue streams, expanding capabilities and strong backlog visibility, Quanta appears well-positioned to sustain earnings growth even without the boost from large transmission megaprojects.

AI Power Boom: Can Quanta Keep Its Infrastructure Edge?

Quanta has a strong hold in the energy and power infrastructure construction market, making it compete directly with renowned cohorts like MasTec, Inc. MTZ and Dycom Industries, Inc. DY.

MasTec competes with Quanta across power delivery, communications and energy infrastructure. While MasTec is benefiting from grid reliability investments and communications spending, its margins have historically been more volatile due to project delays and fluctuations in capital spending. Nonetheless, strong backlog growth tied to clean energy, telecom and infrastructure projects continues to support its long-term growth outlook.

On the other hand, Dycom is more narrowly focused on telecom and fiber networks that connect hyperscale data centers. The company is benefiting from robust fiber deployment and AI-related infrastructure demand, with industry executives describing data center demand as “off the charts.” However, Dycom’s exposure is largely limited to communications infrastructure rather than broader power and energy systems.

PWR Stock’s Price Performance & Valuation Trend

Shares of this specialty contracting services provider have climbed 22.5% in the past three months, outperforming the Zacks Engineering - R and D Services industry, the broader Construction sector and the S&P 500 index.

Image Source: Zacks Investment Research

PWR stock is currently trading at a premium compared with the industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 42.74, as evidenced by the chart below.

Image Source: Zacks Investment Research

Earnings Estimate Revision of PWR

PWR’s earnings estimates for 2026 and 2027 have trended upward in the past 30 days, respectively. The revised estimates for 2026 and 2027 imply year-over-year growth of 19.5% and 18%, respectively.

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Quanta stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.