MasTec Inc. – Value – Zacks Rank Buy

MasTec Inc. (MTZ) reported third quarter results on Oct 28 that surprised on the Zacks Consensus Estimate by 1 cent. It was the fourth consecutive surprise in a row.

MasTec designs and builds infrastructure for communication companies, utilities and governments through the United States.

Earnings per share were 27 cents compared to the Zacks Consensus Estimate of 26 cents. EPS was 35 cents in the third quarter of 2008.

"Once again, we had an excellent quarter, in spite of a difficult economic environment. Continued tight credit markets and delays in the Federal government finalization of stimulus plan programs have delayed projects and caused many of our customers to defer capital expenditures," Jose R. Mas, President and Chief Executive Officer.

"However, with the recent release of Federal stimulus grant monies, combined with this month's rollout of the Federal alternative energy loan guarantee program, projects are beginning to be awarded."

"The loan guarantees are estimated to support up to $70 billion in new renewables projects and we are already beginning to see our order book build nicely for 2010 and beyond, particularly in alternative energy," he added.

The company acknowledged the second half of 2009 had been difficult but it was able to improve margins and was looking for better times in 2010. Its liquidity remained strong in the quarter with cash plus an available credit facility of $183 million. That is up from $108 million in the year ago period.

Raised Guidance for 2009

MasTec raised its EPS guidance for 2009 to 88 cents from its prior forecast of 85 cents.

Analysts have been reacting to the third quarter report and guidance increase.

The fourth quarter Zacks Consensus Estimate is holding at 20 cents per share. The full-year Zacks Consensus jumped to 88 cents from 86 cents with the two covering analysts both raising in the last week.

Value Fundamentals

MasTec is now a Zacks #2 Rank (buy) stock. It still has value characteristics with a forward P/E of 13.7 and a price-to-book of 1.85. The company has a 1-year return on equity (ROE) of 17.44%.

Read the Mar 11 article.

Update to Previous Value Zacks Rank Buy Stocks

Lexmark International, Inc. (LXK) recently surprised on estimates for the third time in four quarters. Lexmark is trading at 10.5x forward earnings. Read the full article.

Sabesp (SBS) is seeing revenue growth as it expands its infrastructure. The stock is cheap. SBS is trading at just 6.8x forward earnings. Read the full article.

DTE Energy (DTE) has surprised on estimates 3 out of the last 4 quarters by an average of 77.06%. The company recently raised 2009 earnings guidance. DTE Energy is trading with a forward P/E of 11.5. Read the full article.

Crane Company (CR) recently raised the bottom end of its full-year earnings guidance. The company has surprised on estimates 4 quarters in a row by an average of 24.22%. Crane is trading with a forward P/E of 14.42. Read the full article.

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