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Opinions Norman Levine
Fluor Corp.FLRCOMMENTMay 26, 2015
Norman LevineStock price when the opinion was issued
As of Jun 16, 2026. Market Open.
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Premium contentOur PAST TOP PICK with FLR has triggered its stop at $48. To remain disciplined, we recommend covering the position at this time. Combined with our previous guidance, this will result in a net investment gain of 35%.
Premium contentPremium contentPremium contentPremium contentPremium contentWe reiterate this global infrastructure company, involved in energy, construction and data centres, as a TOP PICK. It trades at 12x earnings, 1.5x book and supports a robust 72% ROE. We recommend maintaining a tight stop at $29, looking to achieve $47 -- upside potential of 36%. Yield 0.4%
(Analysts’ price target is $47.50)Premium contentThe world renowned engineering company stock has been sliding, despite recently reporting $1.8 billion net income and an 11% increase in revenue — which fell marginally short of analyst expectations. The company has a long runway of projects including a LNG export project in Canada. It trades at 12x earnings, 1.6x book and supports a robust 72% ROE. We recommend setting a stop-loss at $29, looking to achieve $52 — upside potential over 40%. Yield 0%
(Analysts’ price target is $52.89)Had a bit of a speed bump a couple years ago with quick CEO successions. Last couple of years have been good. Last earnings report was not great. Revenues missed. Could be due to project decisions were put on hold for the elections due to uncertainty. Watching to make sure it gets back on track. Some concerns but it is a good quality company.
Gordon ReidLikes the space. Broad infrastructure investments in US will support engineering and construction. Continues to like it on fundamentals and valuation.
Gordon ReidProject management and engineering company. Very strong demand with growing North American economy, Believes old management troubles are behind them. Trading at ~14x earnings, with backlog of projects. Good for long term investors and available at attractive valuation.
Gordon Reidre: Biden infrastrcture plan FLR would benefit from Biden's plan, but FLR wouldn't be his first choice. They've had 3 CEOs in the last 2 years and were the subject of an SEC investigation and had to delay their financial statements. They're getting rid of Stock, a subsidiary. Lots of moving parts here. United Rentals, SNC Lavalin and Jacobs Engineering are better.
The political risk is prevalent across the industry, as we saw with SNC. There are better opportunities. The business is highly cyclical and subject to government policies. He would stay away, but it is a high quality company in the space.
(A Top Pick Sep 6/17, Up 28%) He does not like it much anymore and sold it. You have to trust the execution of management. The fact was they had an issue and said it was fixed. They had a follow up issue and then another and he felt it was out of control. It rallied to an attractive sell price.
An engineering company. Has been looking at this for the last few years. He passed on it because about half their business is very much tied to the energy industry. They work on a lot of huge mega projects. Energy prices being low has negatively impacted them. The company has massively missed their guidance continuously, for the last couple of years, including their most recent quarterly earnings. Their backlog is declining. The dividend is probably secure.
World’s largest construction/engineering company. The whole group has been under pressure and has not been doing too well. Within that group, he far prefers SNC Lavalin (SNC-T) because it has been hurt, not only by the global slowdown, but by the scandals which are now moving behind them, and he sees lots of good growth for them. He would look at SNC as one that has lagged and will outperform. Getting a lot of good contracts.