Kaufman Brothers Expect Growth In MTZ’s Utility Segment
Analysts at Kaufman Brothers maintain their "hold" rating on MasTec Inc (NYSE: MTZ). The target price for MTZ is set to $15.
Kaufman Brothers expects the flat trend in MTZ's communication segment in 2010, with higher wireless revenues from AT&T offsetting a drop in the DirecTV HSP business, lower FTTP work for Verizon and continued deferrals of MSA work for core telco customers. “We are more comfortable with our forecast for DirecTV to be down 4% than management's outlook for it to be flat and we think there is the potential for further downside,” the analysts mention.
The analysts expect MasTec's utility segment to generate revenues of $1.1 billion in 2010. “Our forecast assumes Wind generates $390 million in revenue and Natural Gas generates $350 million, while we look for the core Distribution and Transmission business to drop double digits in 1Q10 and roughly 4% for the year…Virtually all of MasTec's projected revenue from wind and natural gas is already in backlog, while the company's shift to larger transmission projects is improving visibility of its Electrical Utilities business,” the analysts add.
