Dycom Industries (NYSE:DY) Adds Another Growth Vehicle to its Stable of Products

The acquisition of NeoCom Solutions by Dycom Industries (NYSE:DY) has given it another stream for growth in the future, and it comes at the right time.

FBR noted, "To our surprise, Dycom is expanding into the wireless construction market through the announced acquisition of NeoCom Solutions, based in Woodstock, GA. Given Dycom's significant presence across the Southeast, this acquisition appears to be very strategic and timely as we anticipate a steady up-tick in wireless capex activity over the coming years. We reiterate our Outperform rating on the shares of Dycom noting its attractive valuation, corporate share repurchase actions over the past few months, recent inflection point of backlog growth and organic revenue growth, and now acquisitions positioning the company for strategic spending initiatives.

"Over the long-term, we could see this acquisition become the beginning of a much larger move into wireless across the US. Lastly, this acquisition adds another dynamic growth opportunity for Dycom, complimenting developing opportunities, such as: 1) rural broadband, 2) fiber to the tower, 3) customer consolidation and upgrade (ie CenturyLink's iPTV initiative, and Frontier's capital investment program following purchase of VZ access lines), 4) cable metro ethernet investment, and 5) an eventual rebound in the residential housing market."

FBR Capital maintains an "Outperform" rating on Dycom Industries, which closed Monday at $14.83, gaining $0.35, or 2.42 percent.