As of June 17, 2025, Quanta Services Inc's estimated intrinsic value ranges from $52.71 to $602.85 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $602.85 | +66.6% |
| Discounted Cash Flow (5Y) | $369.12 | +2.0% |
| Dividend Discount Model (Multi-Stage) | $324.96 | -10.2% |
| Dividend Discount Model (Stable) | $76.12 | -79.0% |
| Earnings Power Value | $52.71 | -85.4% |
Is Quanta Services Inc (PWR) undervalued or overvalued?
With the current market price at $361.80, the stock appears to be fairly valued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Quanta Services Inc's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 1.27 | 1.37 |
| Cost of equity | 9.7% | 12.6% |
| Cost of debt | 4.0% | 4.9% |
| Tax rate | 22.0% | 23.0% |
| Debt/Equity ratio | 0.08 | 0.08 |
| After-tax WACC | 9.2% | 11.9% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $369 | $58,617M | 76.8% |
| 10-Year Growth | $603 | $93,255M | 61.4% |
| 5-Year EBITDA | $517 | $80,587M | 83.1% |
| 10-Year EBITDA | $741 | $113,724M | 68.4% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $1,220M |
| Discount Rate (WACC) | 11.9% - 9.2% |
| Enterprise Value | $10,231M - $13,219M |
| Net Debt | $3,913M |
| Equity Value | $6,317M - $9,306M |
| Outstanding Shares | 148M |
| Fair Value | $43 - $63 |
| Selected Fair Value | $52.71 |
| Metric | Value |
|---|---|
| Market Capitalization | $53619M |
| Enterprise Value | $57532M |
| Trailing P/E | 57.61 |
| Forward P/E | 27.47 |
| Trailing EV/EBITDA | 13.10 |
| Current Dividend Yield | 10.53% |
| Dividend Growth Rate (5Y) | 17.03% |
| Debt-to-Equity Ratio | 0.08 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $180.85 |
| Discounted Cash Flow (5Y) | 25% | $92.28 |
| Dividend Discount Model (Multi-Stage) | 20% | $64.99 |
| Dividend Discount Model (Stable) | 15% | $11.42 |
| Earnings Power Value | 10% | $5.27 |
| Weighted Average | 100% | $354.81 |
Based on our comprehensive valuation analysis, Quanta Services Inc's weighted average intrinsic value is $354.81, which is approximately 1.9% below the current market price of $361.80.
Key investment considerations:
Given these factors, we believe Quanta Services Inc is currently fairly valued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.