Stock Analysis | Quanta Services Outlook - Weak Technicals and Mixed Analyst Signals

Market Snapshot

Headline Takeaway: Quanta Services (PWR) shows a mixed bag with a weak technical outlook, a solid internal fundamental score of 4.19, and conflicting analyst ratings. The stock has recently fallen by -3.25%, diverging from the neutral market expectations.

News Highlights

Recent news items highlight both opportunities and challenges for Quanta Services and its peers:

• 2025-05-12: BofA upgraded Construction Partners' stock target to $107, emphasizing the company's M&A strategies and market expansion in Texas, Oklahoma, and Tennessee. This hints at broader industry optimism that could indirectly benefit Quanta.
• 2025-05-30: Earnings estimates for Construction Partners (ROAD) are rising, with analysts anticipating improved performance. If this trend continues, it could signal positive momentum in the construction sector, in which Quanta operates.
• 2025-05-23: Granite Construction secured a $26 million contract for taxiway upgrades at SFO. This points to infrastructure spending growth, which may support Quanta’s long-term prospects in the civil infrastructure space.

Analyst Views & Fundamentals

The analyst community is divided. The simple average rating is 4.38, while the weighted performance-based rating is 3.62, showing a divergence in expectations. The ratings span from Strong Buy to Neutral, indicating a lack of consensus.

• High-quality institutions like Citigroup and JP Morgan have shown above-average historical accuracy, with 60% to 100% win rates.
• Key fundamental factors and scores:
• Annualized return on equity (ROE): 9.85% (score: 2.00)
• Price-to-cash flow (PCF): 193.32 (score: 1.00)
• Net operating cash flow / operating revenue: 4.14% (score: 2.00)
• Profit-MV: -1.15 (score: 2.00)
• Net operating cash flow / total liabilities: 4.48% (score: 2.00)
• ROE (DuPont): 2.97% (score: 2.00)
• GPOA: 5.07% (score: 3.00)
• Annualized net profit margin on total assets: 3.97% (score: 2.00)
• Equity multiplier: 254.20% (score: 1.00)

While the fundamental score of 4.19 is positive, the weak technical indicators and bearish price trend suggest the fundamentals may not be fully reflected in the stock price yet.

Money-Flow Trends

Big money is flowing out, with negative trends across all sizes of institutional inflow. The overall inflow ratio is 48.00%, indicating significant outflows. Retail investors also show a negative trend, amplifying the bearish sentiment.

The fund-flow score of 7.83 (internal diagnostic score) highlights strong institutional performance, but the direction remains negative, raising concerns about future investor confidence and liquidity.

Key Technical Signals

Technical indicators are largely bearish:

• WR Oversold has an internal diagnostic score of 3.02 and indicates a neutral to bearish trend with a 47.73% win rate.
• Bearish Engulfing has a score of 1.00, suggesting a strong bearish bias, with only 33.33% win rate.

Recent chart patterns include multiple WR Oversold signals and one Bearish Engulfing pattern. This suggests a consolidation phase with a high likelihood of further downside movement. The technical score of 2.01 (internal diagnostic score) confirms the weak trend, advising caution and avoiding entry at this stage.

Conclusion

Quanta Services is in a challenging phase, marked by weak technical indicators, mixed analyst signals, and negative money-flow trends. While fundamentals remain strong, the recent price drop and bearish chart patterns suggest the stock may not yet be ready for a long-term buy signal. Consider waiting for a pull-back or a clearer breakout before taking action. Investors should also monitor upcoming earnings reports for signs of momentum reversal and further clarity on sector dynamics.