DailyPlay – Opening Trade (PWR) – February 14, 2025

PWR Bullish Opening Trade Signal

Investment Rationale

Quanta Services Inc. (PWR) has recently reached oversold conditions on both daily and weekly timeframes, showing signs of exhaustion that suggest a strong rally ahead, with a target of $360.

Fundamentally, PWR is significantly overvalued and trades at a premium compared to its peers, but its faster-than-expected growth rates and the increasing demand for its services in the buildout of AI-related infrastructure help justify its valuation. PWR has a forward price-to-earnings (PE) ratio of 30.55x, well above the industry average of 22.29x. However, its expected earnings per share (EPS) growth is 18.24%, compared to the industry average of 12.17%, and its expected revenue growth is 12.24%, far outpacing the industry’s 3.65%. While PWR’s net margins are lower at 3.54% versus the industry average of 8.99%, its growth potential and strategic positioning in AI infrastructure make it an attractive investment despite its premium valuation. The company is set to announce earnings on Thursday, February 20, 2025, before the market opens.

PWR – Daily

Trade Details

Strategy Details

Strategy: Long Call Vertical Spread

Direction: Bullish Debit Spread

Details: Buy to Open 2 Contracts PWR April 17 $290/$330 Call Vertical Spreads @ $13.35 Debit per Contract.

Total Risk: This trade has a max risk of $2,670 (2 Contracts x $13.35) based on a hypothetical $100k portfolio risking 2%. We suggest risking only 2% of the value of your portfolio and divide it by $13.35 to select the # contracts for your portfolio.

Counter Trend Signal: This is a bullish trade on a stock that is expected to bounce off recent support.

1M/6M Trends: Bearish/Bearish

Relative Strength: 4/10

OptionsPlay Score: 111

Stop Loss: @ $6.68 (50% loss of premium)

View PWR Trade

Entering the Trade

Use the following details to enter the trade on your trading platform. Please note that whenever there is a multi-leg option strategy, it should be entered as a single trade. 

PLEASE NOTE that these prices are based on Thursday ‘s closing prices. Should the underlying move significantly during the pre-market hours, we will likely adjust the strikes and prices to reflect a more accurate trade entry. 

View PWR Trade