MasTec Inc.: Investor Day Takeaways: Structure, Scale, & Growth Potential

Research evidence excerpt

MasTec Inc.: Investor Day Takeaways: Structure, Scale, & Growth Potential

Barclays | MasTec Inc.

The company is focused on margin and share expansion business expansion and visibility

is improving. 1) The company highlighted scale and mix as two big margin drivers. Both are

core to our thesis, particularly as the pipeline grows (highest-margin business) and execution

gets better with more project activity. 2) We heard more about better regional breadth in

various businesses than we remembered; whether it's in power delivery (balance across three

US regions) or in communications where strength in the southeast is complemented by other

markets like the midwest and west coast. 3) Multi-year / dimensional jobs is more a part of the

story too. PD is the best example with smaller projects folding to multi-year projects. As data

center work grows, they too are multi-part jobs that also leverage multiple aspects of MasTec’s

portfolio including its ability to build wherever and whenever. The contracting on

communications also seems to be evolving into stickier relationships outside of solely MSA-

driven work. 4) The capabilities growth for MasTec is very much under the radar. In

communications, the company is a full turnkey solutions provider and in power delivery it’s not

just D (distribution) but T&D (transmission and distribution). In industrial and infrastructure, the

business is increasingly driven by alternative delivery projects too.

MasTec’s seemingly managing risk better today than before. Risk management will be

necessary as M&A lever unlocks. 1) From legal/permitting delays a few years ago on Mountain

Valley to Greenlinks permitting issues just last year, these are large projects that could have