Wrapping up Q3 earnings, we look at the numbers and key takeaways for the engineering and design services stocks, including Dycom (NYSE:DY) and its peers.

Companies providing engineering and design services boast ever-evolving technical expertise. Compared to their counterparts who manufacture and sell physical products, these companies can also pivot faster to more trending areas due to their smaller physical asset bases. Green energy and water conservation, for example, are current themes driving incremental demand in this space. On the other hand, those providing engineering and design services are at the whim of construction and infrastructure project volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates.

The 5 engineering and design services stocks we track reported a strong Q3. As a group, revenues missed analysts’ consensus estimates by 1.2% while next quarter’s revenue guidance was 1.9% below.

In light of this news, share prices of the companies have held steady as they are up 3.3% on average since the latest earnings results.

Best Q3: Dycom (NYSE:DY)

Working alongside some of the most popular mobile carriers in the world, Dycom (NYSE:DY) builds and maintains telecommunications infrastructure.

Dycom reported revenues of $1.27 billion, up 12% year on year. This print exceeded analysts’ expectations by 4.3%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ adjusted operating income estimates.

Dycom pulled off the biggest analyst estimates beat of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 10.2% since reporting and currently trades at $181.90.

Is now the time to buy Dycom? Access our full analysis of the earnings results here, it’s free.

MasTec (NYSE:MTZ)

Involved in the 1996 Olympic Games MasTec (NYSE:MTZ) is an infrastructure construction company that specializes in the telecommunications, energy, and utility industries.

MasTec reported revenues of $3.25 billion, flat year on year, falling short of analysts’ expectations by 5.4%. However, the business still had a strong quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ adjusted operating income estimates.

The market seems happy with the results as the stock is up 9.6% since reporting. It currently trades at $134.79.

Is now the time to buy MasTec? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: AECOM (NYSE:ACM)

Founded in 1990 when a group of engineers from five companies decided to merge, AECOM (NYSE:ACM) provides various infrastructure consulting services.

AECOM reported revenues of $4.11 billion, up 7% year on year, in line with analysts’ expectations. It was a mixed quarter as it posted full-year EPS guidance slightly topping analysts’ expectations but a miss of analysts’ adjusted operating income estimates.

Interestingly, the stock is up 2.6% since the results and currently trades at $112.

Read our full analysis of AECOM’s results here.

Sterling (NASDAQ:STRL)

Involved in the construction of a major highway, the Grand Parkway in Houston, TX, Sterling Infrastructure (NASDAQ:STRL) provides civil infrastructure construction.

Sterling reported revenues of $593.7 million, up 6% year on year. This print came in 2.3% below analysts' expectations. In spite of that, it was a strong quarter as it produced an impressive beat of analysts’ EBITDA and EPS estimates.

Sterling scored the highest full-year guidance raise among its peers. The stock is up 4.7% since reporting and currently trades at $183.78.

Read our full, actionable report on Sterling here, it’s free.

EMCOR (NYSE:EME)

Through its network of over 70 subsidiaries, EMCOR (NYSE:EME) provides electrical, mechanical, and building construction and services

EMCOR reported revenues of $3.70 billion, up 15.3% year on year. This result missed analysts’ expectations by 2.5%. Taking a step back, it was still a strong quarter as it put up a solid beat of analysts’ EBITDA estimates.

EMCOR delivered the fastest revenue growth but had the weakest full-year guidance update among its peers. The stock is up 9.9% since reporting and currently trades at $474.31.

Read our full, actionable report on EMCOR here, it’s free.

Market Update

Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.

Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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