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Dycom Industries Inc. (DY)

This telecom infrastructure company beat estimates by $0.34 last quarter, and analysts are forecasting that the company will grow nearly 60% this quarter.

Dycom Industries Inc. (DY)
From BI Research

Dycom Industries Inc. (DY), which installs infrastructure for telecoms and cable companies, including wireless companies, is benefiting from an upgrade cycle to gigabyte level service in many markets across the country, clearly drive by the explosion of video being transferred over the internet and via cellphones.

The shares are doing very well. The backlog has climbed $1.75 billion to $5.65 billion just in the past two quarters. Dycom surged on reporting results for its fiscal Q3 ended April. Revenues in the Q were up 35% to $665 million, of which 28.7% was organic. This was more than 10% higher than expectations of “nearly $600 million.”

Meanwhile, adjusted EPS nearly doubled to $1.08, vs. $.58 last year, which was miles ahead of the consensus of $.74 and last year’s $.34. In other words, the company beat estimates by a whopping 46%.

So I’d say we are on the right track here as the backlog continues to swell. Dycom is currently ranked 1 by Zacks and is listed number 5 in the IBD-50 (Investor’s Business Daily) with a composite rating of a highest possible 99. Both have excellent performance records. Estimates for FY7/17 have moved up $.60 to $5.15 in the past 60 days.

In summary, you could do a lot worse than invest in our favorite for 2016.

Tom Bishop, BI Research,, June 29, 2016