The volatile trade pattern exhibited by Quanta Services (PWR) continued this winter. Quanta, first discussed here on June 11, 2009, at a price of $24.76, is decidedly not for investors who want a sleep-well-at-night play.

Quanta formed a bear hug in late 2010 ... only to reverse and zoom $7 higher to trade near $24, then pulled back to about $21.50. With PWR, it's been "pick a number between $17 and $25," and that's likely to be its price by the end of the month.

Nevertheless, if you can tolerate the bumps, the view from here still argues that Quanta is well-positioned to benefit from the upgrade of the nation's electric transmission and distribution grid. Quanta's total order backlog is $6.3 billion, including contract wins with several, major utilities.

Analyst Upgrades

• Chesapeake (CHK) to buy from hold at Canaccord.
• Biogen (BIIB) and Regeneron (REGN) to outperform from sector perform at RBC Capital.
• Caribou Coffee (CBOU) to outperform from neutral and Encore Energy (ENP) to neutral from underperform at RW Baird.
• Fluor (FLR) to market perform from underperform at BMO Capital.
• Hornbeck Offshore (HOS) to conviction buy from neutral at Goldman.
• Saks (SKS) and Zale (ZLC) to neutral from underperform at BofA/Merrill.

The bumpy ride continues with Quanta Services (PWR). Quanta, first discussed here on June 11, 2009 at a price of $24.76, is decidedly not for squeamish investors.

The shares of Quanta, a provider of electric/natural gas/telecom infrastructure services, formed a bear hug in early 2010 and approached the $12 sell/stop loss, then recovered in summer, only to retrench. Were in not for Quanta's power-based infrastructure status, the positioned would have been kicked.

Then, after a modest recovery, Quanta then formed another bear hug in late 2010...only to reverse and zoom $5 higher to currently trade at/near $22. Talk about volatility.

Quanta Services (PWR), first discussed here on June 11, 2009, at a price of $24.76, certainly is not a play for investors who want to make a quick buck.

In early 2010, the shares of Quanta, a provider of electric/natural gas/telecom infrastructure services, had formed a bear hug and approached the $12 sell/stop loss, then recovered in summer, only to retrench. Were in not for Quanta's power-based infrastructure status, the position would have been closed.

But it wasn't, and guess what? Quanta has rebounded, including a move back above $20 and the key, 50-day moving average.

Record incremental progress in the past three months for Quanta Services (PWR), first discussed on June 11, 2009 at a price of $24.76.

The shares of Quanta, a provider of electric/natural gas/telecom infrastructure services, had formed a bear hug and started to veer toward the $12 sell/stop loss. Were it not for Quanta's power-based infrastructure status, the position would have been closed.

The stock of Quanta Services (PWR), which I first wrote about on June 11, 2009, at a price of $24.76, has totally misbehaved.

Quanta, a provider of electric/natural gas/telecom infrastructure services, remains well-positioned to benefit from the upgrade of the nation's electric transmission and distribution grid. Quanta's has a total order backlog of $5.6 billion, including contract wins with several, major utilities.

Analyst Upgrades

• Deutsche Bank upgraded U.S. Steel (X) to buy from hold after raising its steel forecasts and upped its target price on shares to $77 from $44. Note, the firm also downgraded AK Steel.
• Credit Suisse upgraded Philip Morris (PM) to outperform from neutral based on a better international outlook.
• JPMorgan upgraded ev3 Inc. (EVVV) to overweight from neutral. The firm sees upside potential to ev3's consensus estimates for 2010 and raised its target price on shares to $19 from $15.
• Vale (VALE) was upgraded to overweight from equal weight at Barclays.
• Xilinx (XLNX) was raised to outperform from sector perform at RBC Capital.
• Shuffle Master (SHFL) was upgraded at KeyBanc to buy from hold.

Quanta Services (PWR) stock has dipped since the June 11, 2009 Buy call at $24.76, but I'm reiterating my buy rating. Here's why.

It appears that numerous institutional investors decided to exit Quanta early, to close-out 2009 plays, because the stock in November/December fell out of a $19-25 year-long trading range, plunging to $17.85.

"I'm excited about Quanta Services (PWR), a contracting company that specializes in building utility transmission and distribution infrastructure," says Ian Wyatt.

In his Top Stock Insights, he explains, "The current focus in the U.S. of projects that improve energy conservation, utilize renewable resources, and improve air quality make Quanta an excellent long-term growth opportunity.

"Its customers are in the electric power, gas, telecommunications, and cable television industries. These are stimulus spending customers; i.e., big government organizations and utilities companies.

Analyst upgrades:

• Deutsche Bank upgraded Freeport McMoRan (NYSE: FCX) to Buy from Hold to reflect the company's better than expected Q3 results and improved volume outlook. Deutsche raised its target on shares to $100 from $72.
• Thomas Weisel upgraded Motorola (NYSE: MOT) to Overweight from Market Weight and raised its target to $11 from $7 and said they expect Motorola to benefit from several upcoming catalysts that include new Android-based smartphone products and they believe the handset division could break even by year end of 2010.
• Janney Montgomery upgraded Regal Entertainment (NYSE: RGC) and Cinemark (NYSE: CNK) to Buy from Neutral on expectations both companies will benefit from a strong box office in Q4. The firm has a $14 price target on Regal shares and a $13.50 target on Cinemark shares.
• Marshall & llsley (NYSE: MI) was upgraded to Neutral from Underweight at JPMorgan.
• F5 Networks (NASDAQ: FFIV) was upgraded to Neutral from Sell at UBS.
• William Blair upgraded Lindsay Corporation (NYSE: LNN) to Outperform from Market Perform.

Analyst upgrades:

• Deutsche Bank upgraded Coca-Cola (NYSE: KO) to Buy from Hold on expectations that stable volumes and a better outlook for currency and commodities will lead to higher earnings visibility. The firm raised its price target on shares to $62 from $52.
• FBR Capital upgraded Goodrich (NYSE: GR) to Outperform from Market Perform as it finds the stock's valuation compelling following the recent pullback. The firm raised its target on shares to $65 from $46.
• William Blair upgraded Cisco (NASDAQ: CSCO) to Outperform from Market Perform after channel checks indicated demand is accelerating as the firm finds the stock's valuation compelling at current levels.
• Robbins & Myers (NYSE: RBN) was upgraded to Outperform from Neutral at Baird.
• Disney (NYSE: DIS) and Viacom B (NYSE: VIA.B) were upgraded to Neutral from Underperform at BofA/Merrill, while News Corp. (NASDAQ: NWS) was upgraded to Buy from Neutral.

Quanta Services (NYSE: PWR) is in that rare category called 'broken stock, not broken company.'

Perhaps due to concern that regulatory hurdles that might hinder the upgrade of the nation's electric transmission and distribution grid -- a key business area for Quanta -- the stock has exhibited sideways action since the June 11, 2009 Buy recommendation at a price of $24.76.

Analyst upgrades:

• Citigroup upgraded Talbots (NYSE: TLB) to Buy from Hold on expectations the company's sales and margins are at an inflection point. The firm expects comps to turn positive in the next six months and raised its target on shares to $9.50 from $5.
• JMP Securities believes that Apple's (NASDAQ: AAPL) incoming iPod product cycle, geographic expansion of iPhones, and market expansion led by new products will result in "significant" outperformance. The firm upgraded shares to Outperform from Market Perform and has a $200 target on the stock.
• Credit Suisse upgraded Tiffany (NYSE: TIF) to Outperform from Neutral citing productivity comps and gross margin upside, leading to potential upside to 2010 Street estimates. The firm raised its target to $45 from $20.
• Brady (NYSE: BRC) was upgraded to Buy from Hold at KeyBanc.
• Time Warner (NYSE: TWX) was upgraded to Conviction Buy from Neutral at Goldman.
• RadioShack (NYSE: RSH) was upgraded to Overweight from Equal Weight at Morgan Stanley.

Readers of this space know that one of the preferred sectors is the electric/power generation sector, which should benefit from both an expanded infrastructure and ramping energy demand, once U.S. economic growth resumes.

Further, there are lateral lays associated with the above, and Quanta Services (NYSE: PWR) is one.

"A smart grid makes use of coded signals that travel along power lines, much like DSL broadband messages move through the phone telephone," explains growth stock expert Jim Powell.

In Global Changes & Opportunities Report, he looks at two favorite plays on the development of a smart grid: Esco Technologies (NYSE: ESE) and Quanta Services (NYSE: PWR).

"In a smart grid, the signals allow electric meters to report power consumption automatically to suppliers. At the same time, signals can be sent to customer's appliances such as freezers and refrigerators to prevent them from cycling on and off at the same time.