Dycom Industries (DY) growth momentum is driven by rising demand for its wireless services, maintenance work, and data center-related fiber builds, according to a Thursday UBS research report.

Dycom's Q1 results beat analyst estimates on positive organic growth despite difficult comps and record backlog. The brokerage said it sees tax policy changes and customer consolidation increasing telecom capex.

UBS increased it adjusted EPS guidance for full fiscal year 2026 to $10.05 on robust sales growth. It also upgraded the fiscal year 2027 forecast by a similar amount. For fiscal year 2028, the brokerage said it raised adjusted EPS forecast by 8% to 10%.

The brokerage said it retained its buy rating on the stock and increased price target to $258 apiece from $234 earlier.

Price: 221.40, Change: -2.73, Percent Change: -1.22