Quanta Services: Leveraging Skilled Labor Scarcity and Grid Modernization to Drive Earnings Doubling and Support a Buy Rating

In a report released today, Sherif El-Sabbahy from Bank of America Securities reiterated a Buy rating on Quanta Services, with a price target of $500.00.

Sherif El-Sabbahy has given his Buy rating due to a combination of factors tied to Quanta Services’ strategic positioning in a structurally tight skilled labor market. He argues that as AI, power, and data center infrastructure investment becomes more selective and sophisticated, the most persistent bottleneck will be the availability of highly trained craft labor. In this environment, Quanta’s scale, reputation, and ability to marshal specialized crews gives it a clear competitive edge in winning and executing complex grid and data center projects on time and to specification. With a significant portion of the skilled workforce nearing retirement, limited new entrants, restrictive immigration dynamics, and rising demand from utilities and construction, he sees labor scarcity intensifying and further enhancing Quanta’s value proposition.

At the same time, El-Sabbahy highlights that utilities’ multiyear grid reinvestment needs place Quanta in an advantageous growth corridor where it can outpace broader grid capex expansion. He points to Quanta’s track record of roughly 25% earnings CAGR over the past decade as evidence that the company can monetize its labor advantage and operational capabilities. Looking ahead, he projects that the tightening labor backdrop and sustained grid modernization spending can together drive a doubling of Quanta’s earnings over the next five years even without assuming heroic macro assumptions. Combined with a target price above the current share price, this expected earnings trajectory and reinforced competitive moat underpin his Buy recommendation.

In another report released on January 8, Seaport Global also upgraded the stock to a Buy with a $503.00 price target.

Based on the recent corporate insider activity of 50 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of PWR in relation to earlier this year.