Analyst Alexander Waters from Bank of America Securities reiterated a Buy rating on Dycom and keeping the price target at $310.00.
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Alexander Waters has given his Buy rating due to a combination of factors including Dycom’s strong performance in the telecommunications sector, driven by the acceleration of fiber-to-the-home (FTTH) builds and the potential influx of funding from the Broadband Equity, Access, and Deployment (BEAD) program. The company’s stock has seen significant growth, and Waters anticipates further outperformance as BEAD funding begins to be deployed, which could lead to positive revisions in earnings estimates.
Additionally, Dycom is positioned to benefit from the ongoing demand for data centers, with a substantial total addressable market over the next five years. Despite its recent expansion in valuation metrics, Dycom still trades at a discount compared to its engineering and construction peers. Waters believes that given the robust opportunities in the communications infrastructure sector, Dycom’s stock should be valued at a premium, supporting his Buy rating and a price objective of $310.