The USD 25.74 support area, currently tested, might facilitate a technical rebound. The company’s fundamentals could validate this scenario.

From a fundamental viewpoint, Quanta Services is undervalued in terms of enterprise value. Based on the current price, its market capitalization, plus its net debt, represents 0.77 times its revenues.

Nonetheless, recently, EPS estimates for the two coming years have been slightly revised upward by analysts. This positive fact opens the way for a better evaluation of the share by investors.

Technically, the security is in a negative configuration in the short term as the bearish trend of 20-day moving average, currently at USD 26.6, shows. Nevertheless, the stock seems in an oversold situation, near to its USD 25.75 support in daily data, because it was 1% down in the last trading sessions. This level might stop the bearish trend in the short term.

Thanks to the technical pattern and Quanta Services' strong fundamentals, active investors can take a long position above USD 25.75. The downside potential is limited and the timing seems perfect to benefit from a technical rebound.
The first goal will be fixed at USD 27.15 in a first time and then at USD 28.5.
However, a bearish trend would regain the upper hand if the security crosses USD 25.75.