Dycom Industries (DY) Down 7.8% Since Last Earnings Report: Can It Rebound?

A month has gone by since the last earnings report for Dycom Industries (DY). Shares have lost about 7.8% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Dycom Industries due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.Dycom Q1 Earnings & Revenues Top, Raises FY2027 OutlookDycom Industries reported stellar results for the first quarter of fiscal 2027 (ended May 2, 2026). Adjusted earnings and contract revenues surpassed the Zacks Consensus Estimate and grew year over year.Q1 Earnings & Revenue DiscussionDycom reported adjusted earnings per share (EPS) of $4.42, which topped the Zacks Consensus Estimate of $2.73 by 61.9%. In the year-ago quarter, it reported an adjusted EPS of $2.39. Contract revenues of $1.96 billion surpassed the consensus mark of $1.67 billion by 18.0% and grew 56.1% year over year. The metric rose 24.7% on an organic basis. Management noted that demand for fiber infrastructure deployments and data center builds remained robust during the quarter. Power Solutions also outperformed in its first full quarter as part of the Building Systems segment.Operations & Backlog DetailsAdjusted EBITDA increased 74.6% to $262.5 million from a year ago. Adjusted EBITDA margin of 13.4% expanded 141 basis points (bps) from the year-ago level. Dycom’s backlog as of the first fiscal quarter totaled $11.91 billion, up 46.5% year over year from $8.13 billion. Of the current backlog position, $6.40 billion is projected to be completed in the next 12 months.Segmental DetailsBeginning in the fourth quarter of fiscal 2026, Dycom reports results through two reportable segments: Communications and Building Systems. Communications: This segment’s contract revenues increased 24.7% year over year to $1.57 billion. Growth was driven by expansion into additional geographies and fiber-to-the-home builds that ramped ahead of expectations, supported by favorable seasonal conditions. Adjusted EBITDA increased to $192.4 million from $150.4 million a year ago. Adjusted EBITDA margin of 12.3% expanded 31 bps from the year-ago level. This segment’s total backlog grew to $10.80 billion from $8.13 billion a year ago, with a 12-month backlog of $5.38 billion. Building Systems: The segment generated contract revenues of $395.4 million. Adjusted EBITDA was $70.0 million and adjusted EBITDA margin was 17.7%. Total backlog stood at $1.11 billion, with a 12-month backlog of $1.02 billion. The segment benefited from strong execution and demand that exceeded initial expectations.Balance Sheet & Cash FlowAs of May 2, 2026, Dycom had cash and cash equivalents of $538.8 million compared with $709.2 million as of fiscal 2026-end. Long-term debt was $2.81 billion, relatively unchanged from $2.81 billion at fiscal 2026-end. During the first fiscal quarter, DY repurchased 100,000 shares for $36 million.Q2 GuidanceDycom expects contract revenues between $1.94 billion and $2.01 billion for the second quarter of fiscal 2027. Adjusted EBITDA is expected to be between $284 million and $303 million. The company anticipates adjusted EPS in the range of $4.40-$4.82.Fiscal 2027 ViewBased on strong fiscal first-quarter results and expectations for the remainder of the year, Dycom raised its fiscal 2027 outlook. The company now expects contract revenues between $7.38 billion and $7.65 billion, up from its prior guided range of $6.85 billion to $7.15 billion. The updated outlook implies a 33.1-37.9% year-over-year rise and 12.6-15.8% organic growth.The company continues to anticipate adjusted EBITDA margin expansion in fiscal 2027. In the Communications segment, Dycom expects modest adjusted EBITDA margin improvement as operating leverage offsets continued investment to support growth. In the Building Systems segment, the company now expects adjusted EBITDA margin in the high teens, an improvement from its earlier expectation of a mid-teen margin.For fiscal 2027, Dycom expects Communications segment revenues between $6.03 billion and $6.20 billion, while Building Systems revenues are projected between $1.35 billion and $1.45 billion.How Have Estimates Been Moving Since Then?Since the earnings release, investors have witnessed a upward trend in fresh estimates.The consensus estimate has shifted 16.49% due to these changes.VGM ScoresCurrently, Dycom Industries has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a C. Charting a somewhat similar path, the stock has a score of D on the value side, putting it in the bottom 40% for value investors.Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Dycom Industries has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.Beyond Nvidia: AI's Second Wave Is HereThe AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.See Stocks Now >>This article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks