Quanta Services Named Top Energy Transition Pick by BMO on Record Backlog

BMO has designated Quanta Services (NYSE:PWR) as its top stock pick to capitalize on the energy transition, highlighting the company's record-setting backlog and powerful growth fueled by major investments in electrical infrastructure and data centers.

Analyst Thesis

In a recent research note, BMO analyst Ameet Thakkar reiterated an Outperform rating on Quanta Services, describing the company as one of the clearest beneficiaries of a multi-year infrastructure buildout that is still in its early stages. Thakkar pointed to accelerating investment across key growth markets, including electric transmission, grid modernization, data centers, and industrial electrification.

Strong Financials and Growth

The endorsement follows what BMO termed an "exceptionally strong quarter" for Quanta, in which the company materially exceeded expectations and raised its guidance for fiscal year 2026. According to the note, Quanta's organic revenue growth accelerated to approximately 27% year-over-year in its second quarter, with its Electric segment expanding by roughly 33%.

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Following the strong results, BMO raised its fiscal 2026 estimates for Quanta to $40.2 billion in revenue, $4.242 billion in adjusted EBITDA, and $16.85 in earnings per share. The analyst also increased adjusted EBITDA and EPS estimates for the 2027-2030 period by an average of 13.5% and 15.5%, respectively.

Record Backlog Signals Future Growth

A key indicator of future revenue, Quanta's project backlog grew to a record $53.4 billion. The company's book-to-bill ratio was approximately 1.5 times in the quarter, significantly higher than its three-year average of 1.2 times, indicating that new business is outpacing revenue being recognized from completed work.

BMO noted that Quanta's management suggested its largest transmission and generation programs are still ahead, providing visibility for sustained growth well beyond 2030. The analyst added that operational factors like an increasingly flexible workforce and favorable contract structures are supporting margin expansion and stronger cash generation.