The construction industry has been a turbulent place for investors in recent years, and construction specialist MasTec (NYSE:MTZ) has had to weather some tough times in the sector. With many of its customers in hard-hit areas like oil and gas, MasTec has focused recently on finding ways to generate more business while putting itself in position to take full advantage when conditions for its customers start to improve.

Coming into Tuesday's fourth-quarter financial report, MasTec investors were ready to deal with falling earnings, but they still wanted to see signs that the company could boost sales and keep making things better for the long run. MasTec reported some encouraging numbers despite a decline in its bottom line, and many see better times ahead. Let's take a closer look at MasTec and what its latest results say about the construction specialist's future.

Welder connecting two pieces of pipe in front of piles of excavated sand.

Image source: Getty Images.

A boom in backlogs

MasTec's fourth-quarter results showed signs of recovery for the construction industry. Revenue was higher by 19% to $1.60 billion, which almost exactly matched the consensus forecast among those following the stock. Adjusted net income fell by more than 35% from year-earlier levels to $38.8 million, but even though the resulting adjusted earnings of $0.47 per share were down significantly from the fourth quarter of 2016, they were nevertheless better than the $0.37 per share that most investors had expected to see from MasTec.

Unlike what we've seen in recent quarters, MasTec got more balanced performance across its main segments. Oil and gas continued to lead the way higher, with sales gains of 30% that made the segment the leader in terms of revenue generation for the overall company. But the communications segment posted a healthy 11% rise in revenue, and the power generational and industrial business saw segment sales climb 18%. Even the lagging electrical transmission segment managed a small rise in sales for the quarter.

MasTec still hasn't solved all of its problems. Despite higher sales, adjusted pre-tax operating profit for the oil and gas sector dropped by more than 60% from year-earlier levels. Substantial gains of almost 40% in the communications segment's pre-tax operating profit figures only partially offset the poor performance from energy, and small contributions from electrical transmission and from power generation and industrial weren't enough to move the needle higher.

Yet arguably the most encouraging thing about MasTec's quarter was its backlog. Total 18-month backlog across the company set new records at $7.1 billion, climbing more than 40% in just the past three months. The oil and gas, communications, and power generation and industrial segments all set new highs for their respective segment backlog figures as well.

CEO Jose Mas was happy with the results. "We are pleased that 2017 marks the second consecutive year of record financial performance for MasTec," Mas said, "and proud that our 2018 guidance expectation is at yet another record level."

Can MasTec keep up the pace?

MasTec is excited about its future. The backlog figures above contain only those projects that are expected to be completed within the next 18 months, but as the company's CEO noted, many items in MasTec's overall pipeline are multi-year programs that will extend well beyond that 18-month window. That gives the construction specialist some certainty about the long-term prospects for its business in 2019 and beyond, even as many investors focus on immediate recovery efforts.

MasTec's longer-term guidance was equally encouraging, even though its expectations for the coming three months weren't quite what investors had wanted to see. For the first quarter, the company sees sales of $1.23 billion, with adjusted earnings of $0.20 per share. That's only about half the bottom-line profit in the consensus forecast among those following the stock. Yet for the full 2018 year, revenue of $6.75 billion and adjusted earnings of $3.45 per share would be positive surprises, in part made possible by the positive impacts of tax reform.

MasTec shareholders seemed generally pleased with the report, and the stock climbed 2% in after-hours trading following the announcement. With the prospect for improving conditions in many of the industries in which the company provides its services, MasTec looks like it has the potential to keep moving in the right direction throughout 2018 and beyond.