Executive Summary / Key Takeaways

• MasTec, Inc. ($MTZ) is demonstrating robust organic growth across its diversified infrastructure segments, driven by secular tailwinds in communications, clean energy, power delivery, and pipeline infrastructure.
• The company delivered strong third-quarter 2025 results, with revenue nearing $4 billion (up 22% year-over-year) and adjusted EBITDA increasing 20% year-over-year, exceeding guidance across all metrics.
• MasTec's strategic investments in capacity, workforce, and operational excellence are positioning it for significant margin expansion and long-term value creation, with management expressing confidence in exceeding $15 billion in revenue and improving EBITDA margins in 2026.
• Record backlog of $16.8 billion as of Q3 2025, coupled with a strong pipeline of verbally awarded projects, provides substantial visibility for sustained growth into 2026 and beyond.
• While macroeconomic uncertainties and policy shifts present risks, MasTec's diversified portfolio, strong customer relationships, and focus on integrated solutions are expected to mitigate potential impacts.

A Foundation Built on Diversification and Scale

MasTec, Inc. stands as a leading North American infrastructure engineering and construction powerhouse, with a history spanning over 95 years. The company's evolution, particularly under CEO Jose Mas since 2007, has been marked by a strategic vision for diversification and growth, transforming it into a Fortune 500 entity. This journey has involved both significant organic expansion and targeted acquisitions, such as Henkels McCoy Holdings, Inc. in 2021 and IEA in 2022, which, despite initial integration challenges, have broadened MasTec's capabilities and market reach. The company's core business revolves around engineering, building, installation, maintenance, and upgrading critical infrastructure across five reportable segments: Communications, Clean Energy and Infrastructure, Power Delivery, Pipeline Infrastructure, and Other.

MasTec's overarching strategy is to provide integrated, solutions-based services at scale, leveraging its comprehensive expertise across diverse end-markets. This approach is particularly crucial in an industry where customer projects have significantly increased in size, scope, and complexity, demanding strong, capable partners. The company's operational excellence is a key differentiator, encompassing advanced engineering capabilities, sophisticated project integration, and specialized construction methodologies tailored for complex infrastructure. MasTec's commitment to cultivating talent is evident in its over 30 dedicated training facilities across the country, which are instrumental in preparing the workforce for tomorrow's infrastructure demands. This focus on internal capability development, alongside the strategic use of automation tools and continuous refinement of business processes, aims to ensure consistent outcomes and robust structural profitability. These operational and human capital "technologies" form a critical competitive moat, enabling MasTec to secure large-scale, long-term contracts and drive margin expansion.

The company's competitive positioning is strong, particularly in its core North American markets. MasTec's diversified service offerings and extensive customer relationships provide a distinct advantage. For instance, in communications, its fiber-optic and wireless expertise allows it to differentiate from broader utility-focused players. In power delivery, its comprehensive maintenance and upgrade services foster strong customer loyalty. While competitors like Quanta Services may exhibit larger scale in certain energy infrastructure segments and potentially higher overall profitability margins, MasTec's versatility and integrated approach allow it to capture market share in multi-segment projects. Similarly, against specialized electrical contractors like MYR Group , MasTec's broader infrastructure solutions offer a more holistic value proposition. The high barriers to entry in these industries, such as stringent regulatory requirements and substantial capital needs, further protect MasTec's established market position.

Powering Forward: Segmental Performance and Growth Drivers

MasTec's third-quarter 2025 results underscore the efficacy of its diversified strategy, with consolidated revenue reaching $3.97 billion, a 22% increase year-over-year. Adjusted EBITDA grew 20% year-over-year to $374 million, reflecting a 9.4% margin, a notable 160 basis point improvement from the second quarter of 2025. This performance was largely driven by strong execution and operating leverage across its non-pipeline segments.

Communications: Connecting the Future

The Communications segment is a significant growth engine, with third-quarter 2025 revenue climbing 33% year-over-year to $914.60 million, and EBITDA increasing 38% to $103 million, all organically. The EBITDA margin improved 40 basis points to 11.3%. This robust growth is fueled by dynamic telecom infrastructure demand, as customers make substantial capital investments in broadband delivery and advanced AI applications. MasTec's wireless business is expanding geographically and broadening its service offerings, while wireline demand is surging due to extensive broadband infrastructure build-outs by traditional carriers, cable operators, and new fiber overbuilders. The emergence of middle-mile broadband and hyperscaler capital expenditures for data centers are providing additional, significant fiber deployment opportunities. The Lumen contract, which began ramping up in recent months, is anticipated to drive solid growth into 2026. Management believes BEADs funding will also become a significant growth driver from 2026 onwards. The segment's backlog stood at $5.055 billion as of September 30, 2025, up 21% year-over-year.

Clean Energy and Infrastructure: Building a Sustainable Tomorrow

The Clean Energy and Infrastructure segment also delivered impressive results, with third-quarter 2025 revenue growing 20% year-over-year to $1.36 billion and EBITDA improving 36% to $115.40 million, almost entirely organically. The EBITDA margin expanded by 100 basis points to 8.5%. Renewables demand remains healthy, particularly in solar, which is expected to drive the majority of future renewable growth. However, MasTec has also successfully secured significant wind projects for 2026 and beyond, including three of the four largest wind jobs in its history. The Industrial and Infrastructure businesses are also contributing to growth, with strong margin outcomes from transportation, other infrastructure, and data center build-outs (including civil work and behind-the-meter power infrastructure). Battery storage is rapidly becoming a larger part of the portfolio, with most projects now incorporating battery opportunities, contributing to growth in 2025 and expected to continue into 2026. The segment's backlog reached $5.026 billion, a 21% increase from the prior year.

Power Delivery: Modernizing the Grid

The Power Delivery segment reported a 17% year-over-year revenue increase to $1.11 billion in the third quarter of 2025, with EBITDA growing 21% to $104.30 million. This growth occurred despite a challenging comparison due to a lack of storm-related restoration services and lower-than-planned volume from the Greenlink project, which experienced permitting delays. Management remains highly bullish on overall grid investment demand, citing substantial capital expenditure requirements for transmission, substations, distribution, and new generation capacity due to increasing power demand and aging infrastructure. The segment's backlog increased 11% year-over-year to $5.128 billion. Post-Q3 2025, MasTec was awarded its second-largest transmission and substation project ever, expected to commence in mid-2026. While Greenlink's 2025 revenue is now projected around $250 million (lower than initial expectations), its overall profitability is not expected to be impacted, only the timing of revenue recognition. This segment's business is 80-90% maintenance-driven, providing a stable and predictable revenue base, with the project-oriented portion representing significant growth potential.

Pipeline Infrastructure: A Resurgent Market

The Pipeline Infrastructure segment saw a 20% year-over-year revenue increase in the third quarter of 2025, reaching $597.80 million, marking a return to growth after the wind-down of the Mountain Valley Pipeline (MVP) project. The segment's EBITDA margin was 15.4% in Q3 2025, its best performance for the year, with expectations for Q4 2025 to be even stronger, setting a positive trajectory for 2026. Backlog for the segment increased 8% sequentially to $1.571 billion, more than doubling from the prior year. Management notes a shift in how pipeline work is awarded, with commitments often preceding final contract documents, indicating greater visibility than reported backlog suggests. Jose Mas expressed confidence that the segment's revenues in 2026 and beyond could exceed historical high levels of around $3.5 billion, driven by the critical role of gas-fired generation in future energy supply, LNG export demand, and consumer needs. MasTec is making significant investments in personnel and equipment to capitalize on this anticipated multi-year expansion cycle.

Financial Strength and Strategic Capital Allocation

MasTec's financial position is solid, with total liquidity of approximately $2 billion and net leverage at 1.95x as of September 30, 2025. The company's primary liquidity sources are cash flows from operations, its Credit Facility, and cash balances, which are deemed sufficient to meet its working capital, capital expenditure, debt service, and other needs for the foreseeable future. In June 2025, MasTec successfully refinanced its senior unsecured credit facility, extending its maturity to 2030 and adjusting certain terms favorably.

For the full year 2025, MasTec has updated its guidance, projecting revenue of $14.075 billion, adjusted EBITDA of $1.135 billion, and adjusted EPS of $6.40, representing a 62% increase over 2024. This outlook reflects increased activity in Communications and Pipeline, partially offset by Greenlink's timing delays. Management is comfortable with 2026 consensus estimates, which suggest 10% revenue growth, over 20% EBITDA growth, and EPS exceeding $8 per share. The company's midterm objective remains achieving double-digit consolidated EBITDA margins.

MasTec's capital allocation strategy prioritizes supporting robust organic growth through investments in equipment and capacity expansion, where compelling returns are identified. Capital expenditures for 2025 are estimated at $235 million, with an additional $215 million for equipment purchases under finance leases, reflecting investments to meet anticipated demand. The company also plans to be more active in opportunistic, tuck-in acquisitions that complement existing service lines, while maintaining a share repurchase authorization for opportunistic buybacks when the stock price is dislocated from intrinsic value.

Competitive Dynamics and Risk Management

MasTec operates in a highly competitive environment, facing rivals such as Quanta Services (PWR), MYR Group (MYRG), EMCOR Group (EME), and Fluor Corporation (FLR). While MasTec's diversified offerings and strong customer relationships provide a competitive edge, particularly in communications and specialized utility services, some competitors, like Quanta, may demonstrate stronger overall profitability and cash flow generation. MasTec's focus on operational execution and margin improvement is critical to enhancing its competitive standing. The company's P/E ratio of 46.72 and P/B ratio of 4.97 suggest a premium valuation, reflecting investor confidence in its growth prospects.

The company acknowledges several risks, including ongoing macroeconomic volatility, cost inflation, and the dynamic tariff environment. The "One Big Beautiful Bill Act" (OBBBA), enacted in July 2025, accelerates the phaseout of certain clean energy tax credits, which could impact longer-term demand for solar and wind projects. However, MasTec believes its focus on top-tier developers and the fundamental cost-competitiveness of renewables will mitigate these effects. Project delays, such as those experienced with Greenlink due to permitting, also pose risks, but MasTec aims to manage these through contractual protections and a diversified project portfolio. The company's strong balance sheet and compliance with debt covenants provide a buffer against financial risks.

Conclusion

MasTec, Inc. is strategically positioned to capitalize on the unprecedented demand for infrastructure development across North America. Its diversified business model, encompassing communications, clean energy, power delivery, and pipeline infrastructure, provides multiple avenues for growth. The company's commitment to operational excellence, continuous margin improvement, and strong customer relationships forms a robust competitive moat. With record backlog, a clear path to exceeding historical revenue levels in its high-margin pipeline segment, and significant opportunities arising from AI, data centers, and grid modernization, MasTec is poised for substantial earnings growth in 2026 and beyond. While macroeconomic and policy-related uncertainties persist, MasTec's proactive risk management and strategic investments in its capabilities and workforce reinforce its long-term investment thesis as a critical enabler of America's evolving infrastructure landscape.