Monday, August 29, 2005

Dycom lowers numbers again- Verizon not spending?

DY reported results for fourth quarter inline with negative pre-announcement on revenues and one penny ahead on EPS. However, DY lowered guidance for 1st quarter dramatically. Company expects revenue for the first quarter of fiscal 2006 to range from $225 million to $245 million and diluted earnings per share to range from $0.17 to $0.23. Street estimates were at $266 million/$0.36. I talked about how DY can't get its act together and seems like they have been more aggressive in estimating project rollouts. MTZ on the other hand believes it can deliver its numbers. I still think MTZ is a better way to play the telco spending on new projects like Verizon's Fios. MTZ has outperformed the DY since I spoke about this on August 18th. Looking forward to some reasonable explanation from DY on why company keeps lowering number. I do not believe Verizon is moving capex out but it will be very interesting to listen to the call. DY conference call is tommorrow morning (August 30th).

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