Core Insights - Hyperscalers are projected to spend $500 billion on capital expenditures in 2023, driven by the growth of artificial intelligence and the need for data center infrastructure [1] - Quanta Services is positioned to benefit from this trend as it provides essential infrastructure solutions for power and energy, particularly in the context of data center buildout [2][3] Company Overview - Quanta Services operates in two segments: electric infrastructure solutions, which focuses on modernizing the grid and constructing substations, and underground utility solutions for gas, water, and specialty pipelines [3] - The company has a market capitalization of $76 billion and a gross margin of 13.42% [3] Demand Drivers - The rapid expansion of AI technology is expected to increase U.S. data center electricity usage by 133% by 2030, necessitating grid modernization and increased energy supply [4] - Quanta Services has seen a record backlog of $39.2 billion as of September 30, reflecting strong demand across utility, renewable energy, and technology sectors [7] Strategic Acquisitions - Quanta has made significant acquisitions, including Cupertino Electric in 2024, to enhance its capabilities in serving technology and data center clients [6] - The acquisition of Dynamic Systems has further expanded Quanta's ability to service large load facilities, such as semiconductor plants [7] Market Position - Quanta Services plays a crucial role in modernizing the energy infrastructure and is expected to benefit from long-term demand as hyperscalers continue to invest heavily in data center infrastructure [9]

Core Viewpoint - Quanta Services, Inc. is set to release its fourth quarter and full-year 2025 financial results on February 19, 2026, before market opening, accompanied by a webcast and conference call [1] Group 1: Earnings Release Details - The earnings release will be followed by a webcast and conference call scheduled for 9:00 a.m. Eastern time on February 19, 2026 [3] - Supplemental earnings materials will be posted on the Investor Relations section of Quanta's website, which will include operational and financial commentary [2] Group 2: Company Overview - Quanta Services is a leader in providing specialized infrastructure solutions across various industries, including utility, renewable energy, technology, communications, pipeline, and energy [4] - The company offers comprehensive services such as designing, installing, repairing, and maintaining energy and communications infrastructure [4] - Quanta operates in the United States, Canada, Australia, and select international markets, equipped with the necessary manpower, resources, and expertise for projects of varying scopes [4]

Group 1: Strong Buy Ratings - Technology sector shows strong momentum with five stocks rated as "Strong Buy": Meta Platforms Inc. (META), Cisco Systems Inc. (CSCO), Fortinet Inc. (FTNT), Microchip Technology Incorporated (MCHP), and Micron Technology Inc. (MU) [1][2][3][4] - Meta Platforms Inc. has a market capitalization of approximately $1.69 trillion, while Cisco Systems Inc. is valued around $304.27 billion [2] - Fortinet Inc. has a market cap of roughly $61.77 billion, and Microchip Technology Incorporated is valued at approximately $40.42 billion [3][4] - In the industrials sector, SLB Limited (market cap about $74.19 billion) and Quanta Services Inc. (market cap around $70.2 billion) also received "Strong Buy" ratings [2][3] Group 2: Downgrades to Hold - Some large-cap companies faced downgrades to "Hold," indicating a selective market sentiment. Cummins Inc. was downgraded by Wolfe Research, and Public Storage also moved to "Hold" from "Strong Buy" [5] - These downgrades suggest that while certain sectors are favored, investors are cautious about the broader market [5]

Group 1 - The article highlights the expertise of Michael Del Monte as a buy-side equity analyst specializing in technology, energy, industrials, and materials sectors [1] - Michael Del Monte has over a decade of experience in professional services across various industries including Oil & Gas, Oilfield Services, Midstream, Industrials, Information Technology, EPC Services, and consumer discretionary [1] Group 2 - The article does not provide any specific financial data or performance metrics related to companies or sectors [2][3]

Core Viewpoint - Quanta Services, Inc. (NYSE:PWR) is highlighted as a strong investment opportunity in the clean energy sector, particularly due to its robust positioning amid increasing power demand and favorable market conditions [2][3][4]. Group 1: Market Outlook - Wolfe Research has a positive outlook for the clean energy sector entering 2026, citing improved fundamentals after a volatile 2025 [2]. - The firm emphasizes a shift in investor focus towards quality cash flows rather than speculative investments, following a strong rally in the second half of the previous year [3]. - Quanta Services is identified as a preferred investment choice alongside Mastec, benefiting from increased corporate spending on data centers [3]. Group 2: Company Performance and Positioning - Seaport Research upgraded Quanta Services from 'Neutral' to 'Buy' with a price target of $503, marking it as the top large-cap pick for 2026 [4]. - The company is expected to benefit from a tight U.S. skilled-labor market, growth in the Electric Division, and synergies from acquisitions [4]. - Quanta Services provides infrastructure solutions across electric power, renewable energy, and underground markets, supporting utility and energy customers with various services [5].

Quanta Services, Inc. (NYSE:PWR) is one of the best AI energy stocks to buy now. Wolfe Research Bullish on Quanta Services (PWR) Amid Accelerating Power Demand On January 19, 2026, Wolfe Research issued a constructive outlook for clean energy, noting that the sector entered 2026 with improving fundamentals following a volatile 2025. At the same time, the firm remains bullish on Quanta Services, Inc. (NYSE:PWR), citing a very manageable impact from President Donald Trump’s second term and less-than-expect ...

Core Insights - The focus is shifting towards energy stocks that support the AI economy as investors become more bullish on energy and infrastructure providers compared to U.S. megacap technology stocks in 2026 [1][2] Industry Overview - AI and big tech dominated equity returns in 2025, but concerns are rising over volatile returns on capital and higher borrowing costs due to aggressive data center expansions by major tech companies [2] - The semiconductor industry is projected to reach $1 trillion in revenue in 2026, marking a 29% year-over-year growth, driven by AI workloads transitioning from training to inference [3] - Deutsche Bank analysts predict 2026 will be a challenging year for AI, citing supply-chain bottlenecks and energy shortages as key constraints [4] Investment Methodology - The list of the 10 best AI energy stocks was curated based on financial media and resources, focusing on companies that supply electricity to AI data centers or provide necessary infrastructure and fuel systems [6] - Hedge fund sentiment was assessed to rank these stocks, utilizing Insider Monkey's hedge fund database tracking 978 stocks as of Q3 2025 [6] Company Highlights - **Bloom Energy Corporation (NYSE:BE)**: Shares surged to an all-time high of $147.93, climbing 470.43% over the past year due to strong investor momentum and a significant agreement with American Electric Power valued at approximately $2.65 billion [10][11][12] - **NextEra Energy, Inc. (NYSE:NEE)**: Jefferies slightly lowered its price target from $88 to $87 while maintaining a 'Hold' rating, citing large data center-related power contracts as a key catalyst for growth [15][16][17] - **Quanta Services, Inc. (NYSE:PWR)**: Wolfe Research issued a positive outlook for clean energy, highlighting Quanta Services as a preferred pick due to its strong presence in power, gas, and transmission markets amid increasing corporate spending on data centers [19][20][21][22]

Core Viewpoint - The article summarizes significant analyst rating changes that are expected to impact the market, highlighting upgrades, downgrades, and new coverage ratings for various companies [1][6]. Upgraded Ratings - Merril Lynch upgraded Darden Restaurants (DRI) from "Hold" to "Buy," raising the target price from $240 to $265, citing a value-driven operational strategy leading to stable customer traffic and market share growth [5]. - Mizuho Securities upgraded Procter & Gamble (PG) from "Neutral" to "Outperform," increasing the target price from $157 to $165, indicating potential for accelerated organic sales growth and improved profit margins [5]. - Royal Bank of Canada’s Cowen upgraded Fortinet (FTNT) from "Hold" to "Buy," maintaining a target price of $100, based on stable operational expectations for FY2026 [5]. - Deutsche Bank upgraded Applied Materials (AMAT) from "Hold" to "Buy," significantly raising the target price from $275 to $390, reflecting a favorable outlook for the wafer fabrication equipment industry in 2026-2027 [5]. - JPMorgan upgraded Acushnet Holdings (GOLF) from "Underweight" to "Neutral," increasing the target price from $74 to $96, due to a diversified product portfolio and pricing power [5]. Downgraded Ratings - Citizens Bank downgraded Trade Desk (TTD) from "Outperform" to "Market Perform," without providing a target price, citing increasing market competition and limited short-term catalysts for stock price appreciation [10]. - Deutsche Bank downgraded Sherwin-Williams (SHW) from "Buy" to "Hold," lowering the target price from $390 to $380, indicating potential downward pressure on valuation multiples until earnings growth can be proven [10]. - Jefferies downgraded Li Auto (LI) from "Buy" to "Hold," significantly reducing the target price from $28.80 to $17.50, due to intensified competition in the home SUV segment [10]. - Harbor Research downgraded Cleveland-Cliffs (CLF) from "Buy" to "Neutral," acknowledging improved fundamentals but noting that the current stock price reflects normalized earnings levels [10]. - JPMorgan downgraded Southern Copper (SCCO) from "Neutral" to "Underweight," slightly adjusting the target price from $119.50 to $117.50, indicating limited upside potential based on current copper spot prices [10]. New Coverage Ratings - Citigroup initiated coverage on Elf Beauty (ELF) with a "Buy" rating and a target price of $110, highlighting market share growth and potential from the acquisition of skincare brand Rhode [12]. - Freedom Capital initiated coverage on Hinge Health (HNGE) with a "Buy" rating and a target price of $59, forecasting a 23% revenue growth and an industry-leading profit margin of 82%-83% [12]. - Susquehanna Group initiated coverage on HEICO Corporation (HEI) with a "Neutral" rating and a target price of $385, projecting an 8% revenue CAGR and a 13% free cash flow CAGR from FY2026 to FY2028, while noting a significant valuation premium [12]. - Cantor Fitzgerald initiated coverage on Quanta Services (PWR) with an "Outperform" rating and a target price of $520, citing a multi-year investment cycle driven by modernization and electrification trends [12]. - Texas Capital initiated coverage on MGM China (MLCO) with a "Buy" rating and a target price of $11.50, emphasizing its unique non-gaming business model and alignment with Macau's tourism recovery [12].

Company Performance - Quanta Services (PWR) has seen strong stock performance, with an increase of 8.1% over the past month and reaching a new 52-week high of $483.29 [1] - The stock has gained 11.1% since the beginning of the year, matching the Zacks Construction sector's performance but lagging behind the Zacks Engineering - R and D Services industry's 18.5% return [1] Earnings and Revenue Expectations - Quanta Services has a strong record of positive earnings surprises, beating the Zacks Consensus Estimate in the last four quarters, with the latest EPS reported at $3.33 against an estimate of $3.25 [2] - For the current fiscal year, the company is expected to post earnings of $12.41 per share on revenues of $27.95 billion, with a year-over-year earnings growth of 17.23% [3] - For the next fiscal year, earnings are projected to be $14.66 per share on revenues of $31.15 billion, reflecting an 11.44% year-over-year change [3] Valuation Metrics - Quanta Services currently trades at a valuation of 37.8X current fiscal year EPS estimates, which is above the peer industry average of 25.1X [7] - On a trailing cash flow basis, the stock trades at 35X compared to the peer group's average of 15.5X, and it has a PEG ratio of 2.08, indicating it is not in the top echelon from a value perspective [7] Zacks Rank and Style Scores - Quanta Services holds a Zacks Rank of 2 (Buy) due to favorable earnings estimate revisions from analysts [8] - The company has a Value Score of D, a Growth Score of A, and a Momentum Score of C, resulting in a combined VGM Score of B [6] Industry Comparison - The Engineering - R and D Services industry is performing well, ranking in the top 16% of all industries, providing a favorable environment for both Quanta Services and its peer, Fluor Corporation (FLR) [12] - Fluor Corporation also has a Zacks Rank of 2 (Buy) and has shown strong earnings performance, beating consensus estimates by 54.55% [11]

Company Performance - Quanta Services (PWR) closed at $473.24, with a daily increase of +2.1%, outperforming the S&P 500's gain of 1.16% [1] - The stock has gained 6.5% over the past month, while the Construction sector increased by 5.32% and the S&P 500 decreased by 0.42% [1] Upcoming Earnings - Quanta Services is expected to report earnings of $3 per share, reflecting a year-over-year growth of 2.04% [2] - Projected quarterly revenue is $7.31 billion, which represents an increase of 11.57% from the previous year [2] Full Year Projections - For the full year, earnings are projected at $10.59 per share, indicating an increase of +18.06%, while revenue is expected to remain at $27.95 billion, showing no change from the prior year [3] Analyst Estimates - Recent revisions to analyst estimates for Quanta Services are important, as positive revisions typically indicate favorable business outlooks [3] - The Zacks Consensus EPS estimate has increased by 0.31% over the last 30 days [5] Valuation Metrics - Quanta Services has a Forward P/E ratio of 37.34, which is higher than the industry average of 24.33 [6] - The company has a PEG ratio of 2.06, compared to the industry average PEG ratio of 1.95 [6] Industry Context - The Engineering - R and D Services industry, part of the Construction sector, has a Zacks Industry Rank of 37, placing it in the top 16% of over 250 industries [7] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]