Bull of the Day: Dycom Industries (DY)

Dycom Industries, Inc. DY is booming due to demand for telecommunication and digital infrastructure, including data centers. This Zacks Rank #1 (Strong Buy) recently raised its full-year revenue outlook.Dycom Industries is a provider of specialty contracting services to telecommunications infrastructure and utility industries throughout the United States. It does planning, engineering and design, maintenance and fulfillment services for telecommunication providers.It also provides underground facility locating services for various utilities, as well as others construction and maintenance services for electric and gas utilities.Dycom Beat on Earnings Again in the Fiscal 2026 Third QuarterOn Nov 19, 2025, Dycom reported its Fiscal 2026 third quarter results and beat on the Zacks Consensus Estimate for the 7th quarter in a row. Earnings were a record $3.63 compared to the Zacks Consensus Estimate of $3.15. That’s a beat of $0.48.The company beat even its own third quarter guidance, which had been $3.03 to $3.36.Dycom has only missed one time since 2021 and that was in early 2024.It was a record quarter in many areas.Dycom saw record contract revenue, up 14.1%, to $1.45 billion from $1.27 billion last year. On an organic basis, contract revenue rose 7.2%, excluding contract revenue from acquired companies that were not owned for the entirety of both the current and prior year quarters.“The demand drivers for telecommunications and digital infrastructure have never been stronger, fueled by accelerating fiber builds, a massive ramp-up in data center needs, and the much-anticipated arrival of BEAD,” said Dan Peyovich, Dycom’s President and CEO.It had strong operating cash flows of $220 million.As of Oct 25, 2025, Dycom had a record backlog of $8.2 billion, up from $8 billion as of July 26, 2025.Dycom Raised the Mid-Point of its Fiscal 2026 OutlookDycom is bullish on the rest of the year given its record third quarter. It increased the midpoint of its revenue outlook for the year. Contract revenues are now expected to be in the range of $5.35 billion to $5.425 billion, representing a range of 13.8% to 15.4% total growth over last year.It also gave fourth quarter earnings guidance of a range of $1.62 to $1.97, which was higher than the Zacks Consensus of $1.34.As a result, the analysts have raised both the fourth quarter and full year fiscal 2026 and 2027 earnings estimates.3 estimates were raised for fiscal 2026 in the last week. It has pushed the Zacks Consensus to $10.48 from $10.01 in that period. That’s earnings growth of 14.5%.1 estimate was also raised for fiscal 2027 in the last week as well. The Fiscal 2027 Zacks Consensus is now looking for $12.78, up from $10.62. That’s earnings growth of 22%.Here is what it looks like on the 5-year price and consensus chart.Image Source: Zacks Investment ResearchDycom Shares Hit New HighsDycom shares have soared this year to a new all-time high. They are easily outperforming the S&P 500.Image Source: Zacks Investment ResearchThe shares aren’t cheap with a forward price-to-earnings (P/E) ratio of 32.5.But with double digit growth, Dycom has a PEG ratio of just 1.78. A PEG under 1.0 means a company has both value and growth but 1.78 is also low.It also has a price-to-sales (P/S) ratio of just 1.9. A P/S ratio under 1.0 means a company is undervalued, but 1.9 is also cheap, especially compared to the technology companies involved in the AI revolution which are trading with P/S ratios above 10. A ratio above 10 is considered to be expensive.For investors looking for an AI Revolution play that is involved with the AI infrastructure, Dycom Industries should be on your short list.Free Report: Profiting from the 2nd Wave of AI ExplosionThe next phase of the AI explosion is poised to create significant wealth for investors, especially those who get in early. It will add literally trillion of dollars to the economy and revolutionize nearly every part of our lives.Investors who bought shares like Nvidia at the right time have had a shot at huge gains.But the rocket ride in the "first wave" of AI stocks may soon come to an end. The sharp upward trajectory of these stocks will begin to level off, leaving exponential growth to a new wave of cutting-edge companies.Zacks' AI Boom 2.0: The Second Wave report reveals 4 under-the-radar companies that may soon be shining stars of AI’s next leap forward.Access AI Boom 2.0 now, absolutely free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Dycom Industries, Inc. (DY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks