"I'm excited about Quanta Services (NYSE: PWR), a contracting company that specializes in building utility transmission and distribution infrastructure," says Ian Wyatt.

In his Top Stock Insights, he explains, "The current focus in the US of projects that improve energy conservation, utilize renewable resources, and improve air quality make Quanta an excellent long-term growth opportunity."

"Its customers are in the electric power, gas, telecommunications, and cable television industries. These are stimulus spending customers, i.e. big government organizations and utilities companies. 

"Quanta's industry is highly regulated and very cyclical. The industry is pulling out of the cyclical trough with a renewed focus on projects that will improve energy conservation, utilize renewable resources, and improve air quality. Federal stimulus spending is also helping by spurring demand.

"Quanta Services will benefit from U.S. efforts to increase energy independence while meeting clean energy goals. It can build the infrastructure and electricity distribution networks to harness energy from diverse sources like wind, solar, and natural gas.

"In fact, many coal fired power plants are considering making the switch to natural gas as a cleaner, more cost-efficient alternative fuel. 

"While challenging market conditions won't evaporate overnight, and the future of natural gas is not set in stone, Quanta is in an very strong position to capitalize on increasing demand for clean energy initiatives. 

"Quanta has been growing both organically as well as through acquisitions. From 2006 to 2008 revenues increased from $2.1 billion to $3.8 billion. 

"Over the same period, the company reduced its total debt from $450 million to $145 million. With nearly $440 million in cash at the end of 2008, it's safe to say that Quanta Services is growing operations at an attractive pace.  

"Its latest acquisition, Price Gregory Services, just closed in October 2009. Price Gregory is a leading U.S. energy infrastructure company and specializes in the construction of large diameter transmission pipelines.

"These are the big boys that will really get natural gas flowing around the country. I really like that Quanta is growing its natural gas operation at a time when the long-term outlook for the commodity is improving. 

"Right now, there are more than 50 major pipeline projects either approved or under construction in the U.S., and Price Gregory's leadership in the industry will help secure business for Quanta.   

"The acquisition will also bring in nearly $1 billion of revenue in 2009 and increase earnings by $0.13 - $0.21 per share. These are the kinds of immediate earnings increases that I love to see out of acquisitions. 

"Quanta Services is going to grow earnings at a rate around 50% over the next year, and I expect at 25% in 2011. I'm looking for the company to have 2009 EPS of $0.72 and 2010 EPS of $1.11.  

"I don't think the currents share price fully represent the favorable industry momentum, the competitive advantage of the Price Gregory acquisition, and strong financial management of the company. Quanta's shares should trade up to $27."