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Shares of MasTec, Inc. MTZ have gained 29.4% over the past six months, outperforming the 26.4% growth in the Zacks Building Products - Heavy Construction industry. The stock has also surpassed the broader Construction sector's growth of 7% and the S&P 500 index’s 10.9% rally during the same period.
As of Thursday, the stock closed at $138.50, below its 52-week high of $150.12 but well above its 52-week low of $60.96. The MTZ stock has outperformed some other players in the past six months, including AECOM ACM, Fluor Corporation FLR and Stantec Inc. STN. In the said time frame, ACM and FLR have gained 23.4% and 16.4%, respectively, while STN has declined 4.5%.
MTZ Stock’s Six-Month Price Performance
Image Source: Zacks Investment Research
MTZ Stock Trading Above 50 & 200-Day SMA
Technical indicators suggest a continued strong performance for MasTec. From the graphical representation given below, it can be observed that the MTZ stock is trading above both the 50-day simple moving average (SMA) and 200-day SMA, signaling a bullish trend. The technical strength underscores positive market sentiment and confidence in MTZ’s financial health and prospects.
Image Source: Zacks Investment Research
Factors Favoring MTZ Stock’s Surge
This Coral Gables, FL-based leading infrastructure construction company, is benefiting from strong performance in the Clean Energy & Infrastructure segment (accounted for 35% of total third-quarter 2024 revenues), supported by a diversified business model and strategic acquisitions. MasTec is positioned for growth across key segments, driven by solid market demand and a robust backlog. The company’s ability to deliver comprehensive solutions for increasingly complex projects enhances its role as a reliable partner for customers. Favorable macroeconomic trends and improved project efficiencies are also contributing to end-market expansion.
The Communications segment, which accounted for 28.5% of MasTec’s third-quarter revenues, continues to deliver robust growth fueled by expanding market opportunities and rising demand for advanced network infrastructure. The segment achieved double-digit revenue growth both year-over-year and sequentially, reaching its highest revenue levels to date.
On the wireless side, MasTec is expanding its market share with AT&T while the Nokia Ericsson swap-out progresses as planned. The wireline segment also sees strong demand, with Broadband Equity, Access and Deployment funding, along with rising fiber needs driven by artificial intelligence and data centers, which are expected to drive growth. Additionally, MasTec secured a major fiber build from Lumen Technologies, covering over 8,000 miles to expand high-capacity network infrastructure.
As of Sept. 30, 2024, MasTec reported an 18-month backlog totaling $13.86 billion, marking a 3.9% sequential rise and an 11% increase compared to the prior year. This record-high backlog strengthens the company’s momentum heading into 2025, offering clear visibility into upcoming projects that will drive future performance.
MasTec has demonstrated strong financial discipline, prioritizing cash flow generation and efficient capital allocation. The company has made significant progress in deleveraging since its 2022 acquisition, repaying over $900 million of debt through the third quarter of 2024. MasTec’s cash flow conversion has been a key highlight, with approximately 85% of adjusted EBITDA being converted into cash flow.
In the first nine months of 2024, the company generated $649.9 million in net cash from operating activities, surpassing last year’s figure of $196.6 million. This performance has exceeded previous full-year expectations, with MasTec targeting year-end leverage in the low 2X range, further strengthening its financial flexibility.