Dycom Industries (DY:NYS) Fundamental Valuation Report

Fundamental Valuation Report

Dycom Industries(DY:NYS)

Industrials:Engineering & Construction

This Report was generated using the valuation tools available on StockCalc.com. For a free 30 day trial click here.

Close Price/Date
$48.83 (USD) 11/03/2019

Weighted Valuation
$59.00 (USD)

Overall Rating
Undervalued by 20.8%

Valuation Models Analyst Consensus: $59.00 (USD)
(in order of importance)
Valuation Methods This company is:
Cash Flow: Undervalued on a Cash Flow Valuation
Comparable Company: Undervalued on a Comparable Valuation
Asset: Undervalued on an Asset Valuation

Company Overview (DY:NYS USD)

Price 48.83
Range 47.09 – 49.11
52 week 43.33 – 116.20
Open 47.10
Vol / Avg. 541036/966207
Mkt cap 1.54B
P/E 24.79
Div/yield 0.00/0.00
EPS 1.97
Shares 31.44M
Beta 1.45

Company Description

Dycom Industries Inc provides contracting services in the United States and Canada. It offers program management, engineering, construction, maintenance, and installation services for telecommunications providers and utilities. Engineering services include the design of aerial, underground, and buried telecommunications systems that extend from telephone companies to end-users’ homes or businesses. Dycom Industries utilizes copper, coaxial cables, and other materials, and constructs trenches and structures to place the cables or improve distribution lines to consumers. In addition, the company provides tower construction, antenna installation, and other equipment for wireless carriers and television system operators. The majority of sales derive from the United States.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for DY:NYS

Using a discounted cash flow model we generated an intrinsic value of $81.53 (USD) for DY:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

DY:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $81.53 1% 5% 1% 5%
WACC (or Ke) 9.00 $102.76 $66.38
Terminal Growth Rate 3.00 $67.73 $100.86
Tax Rate 0.29 $91.39 $71.67
Cash Flow 409,752,292 $74.48 $88.58
Capital Expenditures 0 $81.53 $81.53
Long Term Debt 719,327,000 $82.68 $80.39

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $66.35 (USD) for DY:NYS. We also generated a valuation of $68.24 (USD) using other metrics and comparables.
The comparable companies were AECOM (ACM:NYS), EMCOR Group (EME:NYS), Comfort Systems USA (FIX:NYS), Fluor (FLR:NYS) and Granite Construction (GVA:NYS).

Company DY:NYS End Date Value
Earnings/Share $1.97 (USD)
Book Value/Share $26.10 (USD)
Sales/Share $97.77 (USD)
Cash Flow/Share $11.09 (USD)
EBITDA/Share $9.26 (USD)
Price Based on Comps Adjustment Factor (%)
$67.23 (USD) 9.1
$56.66 (USD) 14.8
$50.52 (USD) -0.4
$184.19 (USD) -64.2
$92.76 (USD) 3.0
22.88 PE Ratio 34.13 65.87 14.75 17.87 23.65 48.50
1.74 PB Ratio 2.17 1.19 2.32 3.97 1.77 1.61
0.46 PS Ratio 0.52 0.25 0.52 0.92 0.28 0.62
4.06 PCF Ratio 19.07 9.60 15.55 13.69 32.76 23.73
7.30 EV to EBITDA 10.02 11.87 8.16 13.45 6.26 10.36


Using a multiples approach we generated a valuation of  $95.44 (USD) for DY:NYS

Company DY:NYS End Date Value
Earnings/Share $1.97 (USD)
Book Value/Share $26.10 (USD)
Sales/Share $97.77 (USD)
Cash Flow/Share $11.09 (USD)
EBITDA/Share $9.26 (USD)
Price Based on Comps Adjustment Factor
$46.21 (USD) 0
$107.25 (USD) 0
$97.00 (USD) 0
$141.56 (USD) 0
$85.15 (USD) 0
Ratios Ratio Average
PE Ratio 23.46
PB Ratio 4.11
PS Ratio 0.99
PCF Ratio 12.76
EV to EBITDA 9.20

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  DY:NYS for the last 10 years was  4.08

We ran the Adjusted Book Value for  DY:NYS and generated a book value of  $25.59 (USD)
By multiplying these we get an adjusted valuation of  $104.30 (USD)

Analyst Data

In the Stockcalc database there are 2 analysts that provide a valuation for DY:NYS. The 2 analysts have a concensus valuation for DY:NYS for 2020 of $59.00 (USD).

DY:NYS Dycom Industries

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
1 1 0 4.0000 Outperform 2019-3-8

Current Price: 48.83 USD

Analyst Consensus
USD Millions 2020 2021
Mean EPS 2.48 3.66
# EPS Analysts 2 2
Mean Revenue 3,307.00 3,521.50
# Revenue Analysts 2 2
Mean Target Price 59.00
Mean Cash Flow 7.86 7.86
Mean EBITDA 326.80 380.30
Mean Net Income 79.50 108.30
Mean Debt Outstanding
Mean Tax Rate 27.75 27.75
Mean Growth Rate 7.00
Mean Capital Expenditure 160.00 160.00

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

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