Sell: Dycom (DY)
From BI Research
Updated from WSBI 783, July 20, 2016
Dycom (DY), which has risen $38 since its February low, trades at a PE of 15.8 times the FY7/17 consensus while the move to 1 gigabyte service and to “Connect (rural) America” continues unabated. The company is encouraged that industry participants are committed to multi-year capital spending initiatives which in most cases are meaningfully accelerating and expanding in scope, and that as mergers take place in the industry the bigger entities tend to shift to bigger, more stable, more reliable contractors like Dycom.
That said the BI Rank has backed off to 4.7, due to slowing EPS growth (just 6% in the May Q). I’d take $83 for the shares- Sell at $83.
Tom Bishop, BI Research, www.biresearch.com, February 1, 2017