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MasTec Hits 52-Week High on Increased Mobile Data Traffic

Shares of MasTec, Inc. MTZ scaled a new 52-week high of $21.53 on Apr 13, eventually closing the day’s trading at $21.50. The stock price appreciation came on the back of benefits expected from strategic acquisitions and a strong backlog. Increased mobile data traffic will also drive demand.

This provider of construction services has a market cap of $1.7 billion. Meanwhile, average volume of shares traded over the last three months is approximately 1009K. MasTec’s stock flaunts a one-year return of about 6.8% and a year-to-date return of around 23.7%.

Key Strengths

MasTec remains optimistic about the rise in mobile data traffic, which will result in increased demand for the company’s services. While the company was affected by reductions in capital spending for wireless infrastructure by customers in 2015, major carriers are in the process of upgrading to 4G technology, and are testing the next generation of 5G technology for future deployment.

Further, the company expects that its investment in 1 Gigabit per second wireline/fiber network upgrades and expansion of existing networks will increase in 2016 as major national, regional and rural telecommunications providers and other companies continue to invest in and deploy capabilities in these areas.

For full-year 2016, MasTec expects adjusted earnings per share between $1.35 and $1.45 on the back of revenues of $4.6–$4.8 billion. For the first quarter of 2016, MasTec anticipates adjusted bottom line between a loss of 3 cents per share and breakeven, and revenues of $950 million. Moreover, the company will benefit from strategic acquisitions and a strong backlog.

At present, MasTec retains a Zacks Rank #3 (Hold).

Stocks to Consider

Some better-ranked stocks in the sector include Jiangsu Expressway Co. Ltd. JEXYY, Sterling Construction Co. Inc. STRL and Trex Co. Inc. TREX. While Jiangsu Expressway sports a Zacks Rank #1 (Strong Buy), Sterling Construction and Trex carry a Zacks Rank #2 (Buy).

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