We recently compiled a list of the 10 Best Stocks to Buy According to Navellier & Associates. In this article, we are going to take a look at where Quanta Services Inc. (NYSE:PWR) stands against the other stocks approved by Navellier & Associates.
Founded in 1987 by growth analyst Louis Navellier, Navellier & Associates is an independent firm based in Reno, Nevada. Navellier & Associates specializes in identifying market inefficiencies to find top-growth stocks through a disciplined quantitative and fundamental analysis system. With over 30 years of experience, they offer customized portfolio strategies for individual investors to maximize returns while managing risk. Unlike competitors who mimic indexes, Navellier aims to outperform them, resulting in low correlation with benchmarks and increased diversification.
Louis Navellier is the Founder, Chairman of the Board, Chief Investment Officer, and Chief Compliance Officer of Navellier & Associates, Inc. With decades of experience applying academic techniques to real market scenarios, he advocates for disciplined quantitative analysis to identify stocks that can outperform the market. His approach involves a rigorous three-step process: quantitative analysis, fundamental analysis, and optimization of selected securities for portfolio inclusion. This approach has been used by the firm where they employ a highly disciplined, bottom-up stock-selection process for most portfolios. First, they screen market and stock statistics to measure reward (alpha) and risk (standard deviation), selecting stocks in the top percentiles. Next, they further screen the top-ranked stocks for high-profit margins, strong earnings growth, and reasonable price/earnings ratios based on future earnings. Finally, a proprietary optimization model maximizes portfolio alpha while minimizing standard deviation, creating well-diversified portfolios across various sectors and industries.
Since 1980, he has shared his insights through the MPT Review, a stock advisory newsletter. Since 1987, he has actively managed individual portfolios, mutual funds, and institutional portfolios. Known for his charismatic leadership, Louis Navellier has been featured extensively in international media, including CNBC, Bloomberg, The Nightly Business Report, and Wall Street Week. His insights have also been highlighted in Barron’s, Forbes, Fortune, Investor’s Business Daily, Money, Smart Money, and The Wall Street Journal. He has been profiled in books such as Kenneth A. Stern’s “Secrets of the Investment All-Stars” and Alan R. Ackerman’s “Investing Under Fire.” Mr. Navellier earned his B.S. in business administration in 1978 and his M.B.A. in finance in 1979 from California State University – Hayward.
Navellier & Associates is a well-known advisory firm with 1,314 clients and manages assets worth $743,578,818, as reported in their Form ADV from March 2024. Their Q1 2024 filing shows they handle $811,568,534 in securities, with the top 10 holdings making up 29.01% of the total.
Our Methodology
This article covers Navellier & Associates’ top 10 stock picks for the first quarter of 2024. We’ve included analyst ratings and key details about these companies, along with the number of hedge funds investing in each. Why focus on hedge fund investments? Our research indicates that copying the top picks of leading hedge funds can result in better-than-market returns. Our quarterly newsletter’s strategy, which chooses 14 small-cap and large-cap stocks each quarter, has achieved a 275% return since May 2014, outperforming the benchmark by 150 percentage points. (see more details here).
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Quanta Services Inc. (NYSE:PWR)
Navellier & Associates’ Stake Value: $18,857,853
Number of Hedge Fund Holders: 56
Quanta Services Inc. (NYSE:PWR) is a leading provider of specialized contracting services for infrastructure and energy. Its work in growing areas like renewable energy, telecommunications, and utilities makes it well-positioned for future growth. Recently, Quanta Services Inc. (NYSE:PWR) has completed the acquisition of Cupertino Electric for approximately $1.54 billion, which includes $1.3 billion in cash and 883,000 shares of Quanta valued at about $225 million. There’s also a potential additional payment of up to $200 million based on financial targets. The deal is expected to boost Quanta Services Inc. (NYSE:PWR)’s growth, cash flow, and earnings per share right away, with projected contributions of $175-$195 million to adjusted core profit and $0.40-$0.50 to adjusted diluted EPS for FY25.
Quanta Services Inc. (NYSE:PWR) landed on the 6th spot of Navellier & Associates’ top 10 stock picks. By the end of the first quarter of 2024, Navellier & Associates held 72,586 shares of Quanta Services Inc. (NYSE:PWR), valued at $18,857,853. This made up 2.32% of their total portfolio, as reported in their regulatory filings.
Artisan Mid Cap Fund stated the following regarding Quanta Services, Inc. (NYSE:PWR) in its fourth quarter 2023 investor letter:
“Along with DexCom, Inc. (NASDAQ:DXCM), notable adds in the quarter included Quanta Services, Inc. (NYSE:PWR) and Jabil Inc. (NYSE:JBL). Quanta provides outsourced skilled labor for maintenance and construction services, primarily to utilities. We have followed the company for over a decade and have witnessed its shift from oil and gas to renewables. The energy transition (solar and wind farms, electric vehicles, etc.) requires investments in the US energy grid to support greater electrification. At the same time, climate change is increasing stress on the existing grid, forcing utilities to increase maintenance spending. Furthermore, Federal incentive programs, such as the Inflation Reduction Act and Bipartisan Infrastructure Act, will help fuel Quanta’s long-term growth given its expertise in transmission and distribution connections as renewable energy infrastructure seeks to connect to the grid. The stock sold off early in the quarter on concerns that higher interest rates would lead to a pullback in renewables investments by utility customers. However, based on our industry research, we think Quanta’s key customers are well resourced and committed to meeting long-term electrification needs via infrastructure investment. We used the selloff as an opportunity to move the position into the CropSM at a more attractive valuation.”
Overall PWR ranks 6th on our list of the best stocks to buy according to Navellier & Associates. You can visit 10 Best Stocks to Buy According to Navellier & Associates to see the other Navellier & Associates-approved stocks that are on hedge funds’ radar. While we acknowledge the potential of PWR as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than PWR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.