The $42.5B Broadband Equity, Access and Deployment (BEAD) program — the largest telecom infrastructure investment in U.S. history — begins material contractor deployment in 2026–2028. State matching funds and co-investment bring total addressable spend above $60B. Dycom, with 26,000+ credentialed fiber technicians and the deepest AT&T/Comcast relationships in the industry, is the primary execution vehicle. Backlog of $11.9B (all-time record, +68% YoY) reflects early award momentum.
AT&T's 30M-passing fiber target and Comcast's DOCSIS 4.0 symmetrical-gig upgrade represent incremental capex of $10–14B above prior budgets over 3 years. Dycom derives ~35% of revenue from AT&T (MSA extended through 2030) and ~18% from Comcast. These relationships are effectively long-duration annuities backed by federally mandated broadband expansion obligations. No competitor has comparable penetration of AT&T's outside-plant program.
Q1 FY27 (Feb–Apr 2026): Revenue $1.965B (+56% YoY) vs. consensus $1.74B; EPS $4.42 vs. $2.72 estimate — the largest quarterly beat in Dycom history. Gross margin expanded 90bps YoY to 19.4% as volume efficiencies offset labor inflation. Management raised FY27 guidance at the print. The sequential acceleration of organic growth (Q1 organic +38%) demonstrates capacity is not a constraint — demand is the limiting factor.
The $275M acquisition of National Technology Integrators (NTI) closed in Q3 FY26, adding 4,800 specialized technicians with outside-plant and wireless infrastructure expertise in the Southeast and Mid-Atlantic — Dycom's historically underrepresented markets. NTI contributed $142M in Q1 FY27 (7.2% of total revenue). Management targets $30M in annualized synergies by FY28, driven by workforce scheduling optimization and shared procurement. The transaction was immediately accretive to EPS.
| USD $M | FY24A | FY25A | FY26A | FY27E | FY28E | FY29E |
|---|---|---|---|---|---|---|
| REVENUE BREAKDOWN | ||||||
| Telecom / Fiber | 3,090 | 3,653 | 4,110 | 5,790 | 6,850 | 7,700 |
| Cable / MSO | 969 | 1,127 | 1,260 | 1,580 | 1,760 | 1,900 |
| Utilities & Other | 137 | 121 | 110 | 150 | 190 | 300 |
| Total Revenue | 4,196 | 4,901 | 5,480 | 7,520 | 8,800 | 9,900 |
| YoY Growth | +9.6% | +16.8% | +11.8% | +37.2% | +17.0% | +12.5% |
| PROFITABILITY | ||||||
| Gross Profit | 772 | 921 | 1,041 | 1,497 | 1,840 | 2,128 |
| Gross Margin % | 18.4% | 18.8% | 19.0% | 19.9% | 20.9% | 21.5% |
| EBITDA | 492 | 594 | 680 | 978 | 1,197 | 1,386 |
| EBITDA Margin % | 11.7% | 12.1% | 12.4% | 13.0% | 13.6% | 14.0% |
| D&A | (162) | (182) | (203) | (248) | (275) | (292) |
| EBIT | 330 | 412 | 477 | 730 | 922 | 1,094 |
| Interest Expense | (72) | (81) | (92) | (112) | (100) | (82) |
| Pre-tax Income | 258 | 331 | 385 | 618 | 822 | 1,012 |
| Income Tax (~25%) | (67) | (85) | (98) | (154) | (206) | (253) |
| Net Income | 191 | 246 | 287 | 464 | 616 | 759 |
| EPS (Diluted, GAAP) | $7.35 | $9.46 | $11.04 | $17.77 | $23.69 | $29.19 |
| Diluted Shares (M) | 26.0 | 26.0 | 26.0 | 26.1 | 26.0 | 26.0 |
| USD $M | FY24A | FY25A | FY26A | FY27E | FY28E |
|---|---|---|---|---|---|
| KEY BALANCE SHEET ITEMS | |||||
| Cash & Equivalents | 182 | 212 | 287 | 415 | 572 |
| Accounts Receivable + WIP | 678 | 784 | 872 | 1,192 | 1,400 |
| Total Current Assets | 942 | 1,098 | 1,264 | 1,736 | 2,092 |
| PP&E, Net | 1,162 | 1,318 | 1,480 | 1,804 | 1,999 |
| Total Assets | 2,452 | 2,782 | 3,110 | 4,364 | 5,010 |
| Accounts Payable | 289 | 334 | 376 | 514 | 602 |
| Long-Term Debt | 1,452 | 1,618 | 1,752 | 2,102 | 1,852 |
| Total Equity | 712 | 854 | 1,022 | 1,488 | 2,104 |
| Net Debt | 1,270 | 1,406 | 1,465 | 1,687 | 1,280 |
| Net Debt / EBITDA | 2.6x | 2.4x | 2.2x | 1.7x | 1.1x |
| CASH FLOW STATEMENT | |||||
| Cash From Operations (CFO) | 378 | 454 | 528 | 786 | 958 |
| Capital Expenditures (Capex) | (194) | (238) | (274) | (358) | (398) |
| Free Cash Flow (FCF) | 184 | 216 | 254 | 428 | 560 |
| FCF Yield (on market cap) | 1.4% | 1.6% | 1.9% | 3.2% | 4.2% |
| M&A / Acquisitions | (12) | (18) | (302) | — | — |
| Share Repurchases | (78) | (52) | (64) | — | — |
| Company | Ticker | Mkt Cap | Rev Growth | EBITDA Mgn | EV/EBITDA FY27E | P/E FY27E | Rating |
|---|---|---|---|---|---|---|---|
| Quanta Services | PWR | $42B | +11% | 10.8% | 18.2x | 29x | BUY |
| MasTec | MTZ | $15B | +8% | 9.4% | 9.2x | 14x | HOLD |
| MYR Group | MYRG | $2.4B | +6% | 5.8% | 7.8x | 13x | HOLD |
| Construction Partners | ROAD | $3.8B | +15% | 9.2% | 14.2x | 22x | BUY |
| Dycom Industries | DY | $13.3B | +37% | 13.0% | 15.2x | 28.7x | BUY ★ |
Dycom Industries occupies an irreplaceable position at the epicenter of the largest telecom infrastructure buildout in American history. The convergence of the $60B+ BEAD program, AT&T's 30M-passing fiber mandate, Comcast's DOCSIS 4.0 upgrade, and 5G small-cell densification creates a demand runway that dwarfs any prior cycle. Q1 FY27's record $1.965B revenue (+56%) and EPS $4.42 — a 63% beat vs. consensus — confirm that Dycom's workforce scale and customer relationships translate directly to earning power. Backlog at an all-time high of $11.9B (1.6x FY27E revenue) provides unmatched forward visibility for a contractor. We model FCF rising from $254M (FY26A) to $560M (FY28E) as revenue scales and margins expand on project density. At 28.7x FY27E EPS, the stock carries a premium to peers — but this is warranted by the federal program certainty and BEAD's multi-decade revenue lock-in. Price Target: $615 (BUY) — represents 25.9x FY28E EPS of $23.69. Overweight.