Overview
KeyBanc has reiterated its Overweight rating on Dycom Industries (NYSE: DY) and set a refreshed price target of $426.00, which equates to about a 14% upside from the stock's current trading price of $373.27. The company’s shares have risen sharply over the past year, delivering a 109.5% return.
Analyst commentary and near-term calendar
KeyBanc analyst Sangita Jain maintained the firm's positive stance on Dycom while noting there are "multiple moving parts" entering the company’s fiscal fourth quarter of 2026. Investors should note Dycom is scheduled to report earnings on March 4. Ahead of that report, KeyBanc is adjusting its fiscal year 2027 estimates and has left its fiscal year 2028 projections unchanged.
Factors driving the outlook
KeyBanc said it expects growth in the latter half of the decade to be supported by anticipated increases in long-haul fiber deployment and the implementation of the Broadband Equity, Access, and Deployment (BEAD) program. The firm stated its maintained Overweight rating reflects continued confidence in Dycom’s business prospects despite the complexities it sees in the near-term operating picture.
Market consensus and valuation context
The firm’s view is consistent with broader analyst sentiment: the stock carries a Strong Buy consensus recommendation. According to InvestingPro, Dycom holds a "GREAT" overall financial health score of 3.1. The same data indicates the stock trades at a high price-to-earnings ratio of 36.9 and is currently trading above its Fair Value. InvestingPro notes that subscribers can access 12 additional ProTips and a comprehensive Pro Research Report on Dycom, one of more than 1,400 US equities covered.
Acquisition and peer reactions
Dycom has completed its acquisition of Power Solutions, LLC for $1.63 billion. Power Solutions is an electrical contractor serving data centers in the Mid-Atlantic region. The transaction closed using cash consideration and approximately 1.0 million shares of Dycom common stock as part of the deal consideration.
Following that acquisition, Wells Fargo raised its price target on Dycom to $360, calling the deal "transformational" in terms of diversifying the company’s revenue base. KeyBanc has also increased its price target on Dycom to $426, citing an improved growth and margin outlook driven by fiber-to-the-home expansion and anticipated data center investments. The firm reiterated its Overweight rating and described Dycom as being in the early stages of a telecom investment expansion cycle.
Prior revisions
KeyBanc previously raised its price target to $392 after Dycom’s fiscal third-quarter results came in ahead of expectations. The sequence of target revisions and the recent acquisition underline the positive tone among analysts surrounding Dycom’s strategic moves and outlook.
Key points
- KeyBanc reaffirmed an Overweight rating on Dycom and set a $426.00 price target, implying about 14% upside from a $373.27 share price.
- Dycom’s stock has returned 109.5% over the past year and now carries a Strong Buy consensus among analysts.
- Long-term growth expectations hinge on increased long-haul fiber deployment and implementation of the BEAD program; recent M&A activity expands exposure to data center electrical work.
Sectors impacted
- Telecommunications infrastructure and broadband deployment
- Data center construction and electrical contracting
- Industrial contractors and capital spending tied to telecom expansion
Risks and uncertainties
- Near-term operating complexity - KeyBanc warns of "multiple moving parts" entering Dycom’s fiscal fourth quarter of 2026, creating short-term performance uncertainty.
- Valuation risk - InvestingPro data shows Dycom trading at a high P/E of 36.9 and above its Fair Value, indicating elevated valuation risk if growth expectations are not met.
- Dependence on macro investment drivers - KeyBanc’s growth case is contingent on anticipated long-haul fiber deployments and BEAD program implementation, outcomes that will influence telecom-related spending.
What to watch next
Market participants will be focused on Dycom’s March 4 earnings report and any additional detail management provides on the integration of Power Solutions, LLC and the company's exposure to upcoming fiber and data center investment projects.