Analyzing TSS (NASDAQ:TSSI) & Quanta Services (NYSE:PWR)

Quanta Services (NYSE:PWR) and TSS (NASDAQ:TSSI) are both construction companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, institutional ownership and valuation.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Quanta Services and TSS, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Quanta Services	0	12	14	0	2.54
TSS	0	1	1	0	2.50

Quanta Services currently has a consensus target price of $410.45, suggesting a potential downside of 5.57%. TSS has a consensus target price of $20.50, suggesting a potential upside of 26.54%. Given TSS’s higher possible upside, analysts plainly believe TSS is more favorable than Quanta Services.

Earnings & Valuation

This table compares Quanta Services and TSS”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Quanta Services	$23.67 billion	2.74	$904.82 million	$6.46	67.28
TSS	$148.00 million	2.78	$5.98 million	$0.36	45.00

Quanta Services has higher revenue and earnings than TSS. TSS is trading at a lower price-to-earnings ratio than Quanta Services, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Quanta Services and TSS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Quanta Services	3.73%	18.41%	7.15%
TSS	3.43%	107.01%	8.66%

Insider and Institutional Ownership

90.5% of Quanta Services shares are owned by institutional investors. 1.1% of Quanta Services shares are owned by company insiders. Comparatively, 18.9% of TSS shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk and Volatility

Quanta Services has a beta of 1.04, indicating that its stock price is 4% more volatile than the S&P 500. Comparatively, TSS has a beta of 1.73, indicating that its stock price is 73% more volatile than the S&P 500.

Summary

Quanta Services beats TSS on 8 of the 14 factors compared between the two stocks.

About Quanta Services

Quanta Services, Inc. provides infrastructure solutions for the electric and gas utility, renewable energy, communications, and pipeline and energy industries in the United States, Canada, Australia, and internationally. The company’s Electric Power Infrastructure Solutions segment engages in the design, procurement, construction, upgrade, repair, and maintenance of electric power transmission and distribution infrastructure and substation facilities; installation, maintenance, and upgrade of electric power infrastructure projects; installation of smart grid technologies on electric power networks; and design, installation, maintenance, and repair of commercial and industrial wirings. This segment also offers aviation services; emergency restoration services; and other engineering and technical services; design and construction solutions to wireline and wireless communications, cable multi-system operators, and other customers; and training for electric workers, as well as training for the gas distribution and communications industries. The company’s Renewable Energy Infrastructure Solutions segment is involved in engineering, procurement, construction, repair, and maintenance of wind, solar, and hydropower generation facilities, as well as battery storage facilities; and provision of engineering and construction services for substations and switchyards, transmission, and other electrical infrastructures. The company’s Underground Utility and Infrastructure Solutions segment offers design, engineering, procurement, construction, upgrade, repair, and maintenance services for natural gas systems for gas utility customers; fabrication services for pipeline support systems and structures and facilities; and engineering and construction services for pipeline and storage systems, and compressor and pump stations. The company was formerly known as Fabal Construction, Inc. and changed its name to Quanta Services, Inc. in November 1997. The company was incorporated in 1997 and is headquartered in Houston, Texas.

About TSS

TSS, Inc. offers planning, design, engineering, construction management, commissioning and maintenance services. It provides these services primarily for specialized facilities such as data centers, communications rooms, call centers, laboratories, trading floors, network operations centers, medical facilities and similar environments. TSS Inc., formerly known as Fortress International Group, Inc., is based in Columbia, United States.