Dycom falls after third-quarter earnings guidance misses estimates

Dycom Industries Inc. (NYSE: DY ) stock traded lower Wednesday after the company issued third-quarter adjusted earnings guidance with a midpoint below Wall Street estimates.

Earnings Snapshot Dycom reported adjusted earnings of $5.29 per share, beating the $4.72 estimate.

Contract revenue climbed 45.6% year over year to $2.01 billion, topping the $1.98 billion estimate.

Organic revenue increased 16.7%.

CEO Dan Peyovich cited strong digital infrastructure demand, improved profitability and above-market growth.

New contract awards pushed backlog to a record $12.2 billion.

That included more than $1 billion of long-haul, middle-mile and defense fiber projects.

Adjusted EBITDA rose 53.5% to $315.5 million.

The adjusted EBITDA margin expanded 81 basis points to 15.7%.

Operating cash flow totaled $103.7 million, while trailing 12-month free cash flow nearly tripled.

Dycom ended the quarter with $340.1 million in cash and more than $1.09 billion in liquidity.

Segment Performance Communications revenue reached $1.61 billion, with organic growth of 16.7%.

Fiber-to-the-home revenue jumped nearly 60% during the first half.

However, about $150 million of wireless revenue shifted into fiscal 2028.

Dycom said the underlying backlog and program scope remained unchanged.

Communications adjusted EBITDA increased to $218.3 million.

Its margin fell 134 basis points to 13.6% due to expansion investments, wireless project delays and higher fuel costs.

Building Systems generated $397.5 million in revenue and $97.2 million in adjusted EBITDA.

Its margin was 24.5%.

National Technology Integrators contributed $22.9 million in second-quarter revenue.

Read Also: Dycom Earnings Are Imminent; These Most Accurate Analysts Revise Forecasts Ahead Of Earnings Call Share Repurchase Program Dycom approved a new $150 million share repurchase program through February 2028.

It replaces the previous $150 million authorization, which had about $83.9 million remaining.

Outlook Dycom raised its fiscal 2027 revenue forecast to $7.48 billion to $7.66 billion from $7.38 billion to $7.65 billion.

The consensus estimate is $7.62 billion.

For the third quarter, Dycom expects adjusted earnings of $4.33 to $4.79 per share.

The midpoint of $4.56 falls below the $4.79 estimate.

The company forecast quarterly revenue of $1.90 billion to $1.98 billion, compared with the $1.94 billion estimate.

Dycom is also building a flagship training facility in Georgia, which it expects to open during the first half of 2027.

DY Price Action: Dycom Industries shares were down 11.07% at $312.85 at the time of publication on Wednesday, according to Pro data.

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