investorscraft@gmail.com

Intrinsic Value of Dycom Industries, Inc. (DY)

Previous Close$250.27
Intrinsic Value
Upside potential
Previous Close
$250.27

VALUATION INPUT DATA

This valuation is based on fiscal year data as of 2025 and quarterly data as of .

Data is not available at this time.

Stock Valuation Context

Business Model And Market Position

Dycom Industries, Inc. operates as a leading specialty contracting services provider in the telecommunications infrastructure sector. The company primarily serves telecom carriers, utilities, and government entities, offering engineering, construction, maintenance, and installation services for network infrastructure. Dycom’s revenue model is project-based, driven by long-term contracts with major clients such as AT&T, Verizon, and Comcast, ensuring steady cash flows. The company’s expertise in fiber-optic and wireless network deployment positions it as a critical enabler of 5G expansion and broadband modernization. Dycom differentiates itself through scale, technical capabilities, and a decentralized operational structure that allows localized execution. Its market position is strengthened by high barriers to entry, including specialized labor and equipment requirements, as well as entrenched relationships with blue-chip customers. The telecom infrastructure industry is poised for sustained growth, supported by federal funding initiatives and increasing demand for high-speed connectivity, which bodes well for Dycom’s long-term prospects.

Revenue Profitability And Efficiency

Dycom reported revenue of $4.70 billion for FY 2025, with net income of $233.4 million, reflecting a net margin of approximately 5.0%. The company generated $349.1 million in operating cash flow, demonstrating solid conversion of earnings into cash. Capital expenditures totaled $250.5 million, indicating reinvestment in operational capacity. Diluted EPS stood at $7.92, underscoring profitability on a per-share basis.

Earnings Power And Capital Efficiency

Dycom’s earnings power is supported by its contract-driven model and scalable operations. The company’s ability to secure large-scale projects with reputable clients enhances revenue visibility. Capital efficiency is evident in its disciplined capex approach, balancing growth investments with cash flow generation. The absence of dividends suggests a focus on reinvesting profits to capture market opportunities.

Balance Sheet And Financial Health

Dycom’s balance sheet shows $92.7 million in cash and equivalents against total debt of $1.06 billion, indicating a leveraged but manageable position. The debt level reflects strategic borrowing to fund growth initiatives. The company’s operating cash flow coverage of debt obligations appears adequate, supported by stable project inflows.

Growth Trends And Dividend Policy

Dycom’s growth is tied to telecom infrastructure spending, particularly 5G and fiber expansion. The company does not currently pay dividends, opting to allocate capital toward organic growth and potential acquisitions. Revenue trends are likely to benefit from industry tailwinds, though margins may fluctuate with project mix and input costs.

Valuation And Market Expectations

Dycom’s valuation reflects its role in a high-growth sector, with investors pricing in execution on large contracts and margin stability. The stock’s performance will hinge on the company’s ability to capitalize on federal broadband funding and maintain competitive positioning. Market expectations are aligned with sustained industry demand, though macroeconomic factors could influence spending cycles.

Strategic Advantages And Outlook

Dycom’s strategic advantages include its specialized expertise, long-term client relationships, and scalable operations. The outlook is positive, driven by secular demand for network upgrades and limited competition at scale. Risks include labor shortages and project timing delays, but the company’s track record supports confidence in its ability to navigate industry dynamics.

Sources

Company filings (10-K), investor presentations

show cash flow forecast

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year2026202720282029203020312032203320342035203620372038203920402041204220432044204520462047204820492050

INCOME STATEMENT

Revenue growth rate, %NaN
Revenue, $NaN
Variable operating expenses, $mNaN
Fixed operating expenses, $mNaN
Total operating expenses, $mNaN
Operating income, $mNaN
EBITDA, $mNaN
Interest expense (income), $mNaN
Earnings before tax, $mNaN
Tax expense, $mNaN
Net income, $mNaN

BALANCE SHEET

Cash and short-term investments, $mNaN
Total assets, $mNaN
Adjusted assets (=assets-cash), $mNaN
Average production assets, $mNaN
Working capital, $mNaN
Total debt, $mNaN
Total liabilities, $mNaN
Total equity, $mNaN
Debt-to-equity ratioNaN
Adjusted equity ratioNaN

CASH FLOW

Net income, $mNaN
Depreciation, amort., depletion, $mNaN
Funds from operations, $mNaN
Change in working capital, $mNaN
Cash from operations, $mNaN
Maintenance CAPEX, $mNaN
New CAPEX, $mNaN
Total CAPEX, $mNaN
Free cash flow, $mNaN
Issuance/(repurchase) of shares, $mNaN
Retained Cash Flow, $mNaN
Pot'l extraordinary dividend, $mNaN
Cash available for distribution, $mNaN
Discount rate, %NaN
PV of cash for distribution, $mNaN
Current shareholders' claim on cash, %NaN
HomeMenuAccount