MasTec Is Well Positioned For 2018, The Numbers Prove It

Feb. 28, 2018 1:47 AM ETMasTec, Inc. (MTZ)12 Comments
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WG Investment Research


  • MasTec recently reported impressive Q4 and Full-year 2017 operating results and the company's management team provided strong guidance for 2018.
  • This small-cap company is well positioned for 2018 and beyond.
  • MasTec is a long-term buy at today's price.

MasTec (NYSE:MTZ) has been a top performer for the R.I.P. Portfolio over the last year. Additionally, MasTec's most recent operating results show that its management team has the company well-positioned for 2018 and beyond.

This small-cap infrastructure company (market capitalization of ~$4.25B) has reported strong financial results in each of the last four quarters and the company's business segments are operating in industries that have promising long-term prospects. As a direct result, MTZ shares have outperformed the broader market by a wide margin over the last year.

MTZ data by YCharts

However, it is important to note that MTZ shares are still attractively valued, even after the recent stock performance. Additionally, I believe that the company's Q4 and Full-year 2017 results show that the bull case for MasTec is still intact.

Background & Bull Case

MasTec is an infrastructure company that has four operating segments, with the Communications unit being the largest segment.

Source: Barclays Industrial Select Conference Presentation, Feb. 22, 2018

As shown, management has diversified MasTec's business so the company is no longer tied strictly to the communications industry. Over the past few years, the company was negatively impacted by the downturn in the oil and gas industry but, more recently, even this operating segment has experience strong growth. MasTec's current structure has allowed for its management to heavily invest in high-growth areas while the company contended with industry headwinds, and these investments have already paid huge dividends. To this point, MasTec has reported double-digit growth in revenue and adjusted EBITDA over the last ten years.

Full Disclosure: The company reported full-year 2017 revenue of $6.6B and adjusted EBITDA of $645M, as described later in the article.

MasTec has a proven track record for growing its business and, in my opinion, there are no signs of this company slowing down

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This article was written by

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Our President and CIO is a CPA with experience in public accounting and the financial services industry. He earned his Master of Accountancy degree in 2008 and his B.S. in Business Management in 2007. He is also a Level III CFA candidate. He has been intrigued by the market from the start. Over the years, he has learned that long-term investing is a discipline that, if followed, will help contribute to building lasting wealth. As such, most of our articles will be about the investments that we plan to hold for at least 3 to 5 years, as long as the company's story does not change. As a Seeking Alpha contributor, our main goal is to write about the companies that are key to our portfolio with the hope of promoting discussion (for or against the investment) from others within the SA community.Please visit our website for more information about W.G. Investment Research LLC.

Disclosure: I am/we are long MTZ. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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