I first came across Dycom in the New America column of the Sept 10, 2015 IBD. It is currently the number 1 stock in the IBD 50.
Company description from web-site:
Dycom Industries, Inc. is a leading provider of specialty contracting services to the dynamic telecommunications and infrastructure industry. These services, which are provided throughout the United States and in Canada, include engineering, construction, maintenance and installation services to telecommunications providers, underground facility locating services to various utilities, including telecommunications providers, and other construction and maintenance services to electric and gas utilities and others
Kind of sounds like they dig ditches and lay fiber (and their pictures show that)
SEC filings links here: http://www.dycomind.com/investor-center.aspx
Composite = 99
EPS = 99
RS = 99
Industry group rank #10
SMR = C
Accumulation = A
5 year profit growth rate = 46%
You can see that on Black-Flash-Crash-Monday DY stared into the abyss for about 1 second then took off like superman rocketing to new highs as of today. Translation – this is a strong stock that people are eating up. But why? Well…
As Rivals Try To Match Verizon’s Fiber, Guess Who Benefits?
Biggest telecom field service provider. Poised to take lion’s share in sales of what is shaping up to be a supercycle in the telecom market. Customers: Verizon, ATT, Comcast and others.
(Me: All those Netflix movies and smartphone calls/data have to go through fiber).
Heart of business is putting fiber in the ground for customers (and pulling out the copper). The also maintain the lines and equipment. (But less than 15% of gear supports the wireless networks).
Gartner: total projected telecom equip spending expected to increase 9.5% from $168.8B in 2014 to $184.8B in 2017. Thompson Reuters expects Dycom’s sales to increase 49% during that period to $2.7B up from $1.81B in 2014.
Copper lines to homes are getting maxed out by all the data, so fiber upgrade is a must. (Think 4K video from Netflix).
Since Dec 2014 stock is up 131% . Aug Q4 earnings announcement showed EPS up 102% vs same Q last year (up to 0.97 cents, beating estimates by 14 cents).
CEO It is increasingly likely that in retrospect, calendar year 2015 will be clearly seen as the foundational year for a massive investment cycle in wireline networks, reminiscent of and perhaps more meaningful than one that occurred in the 1990s” Verizon started they 10 year switch to fiber in the 1990s and you might have heard of a stock called JDSU too.
Now Sprint and ATT are doing the same massive change. Others like CenturyLink have also talked about upping their speeds to 1 gigabit/second – which takes fiber. (Right now most of us have a max of 50Mbs for our home internet connections).
Dycom has about 44 subsidiaries and obtained many when the market was bad – copper had slowed and fiber had not really started up, so sounds like they got them for a good deal.
Our spreadsheet here:
says 1YPEG is 0.29 (interested now?)
Nothing on TipTree’s spreadsheet.