Opinions
Stephen Groff
Fluor Corp.
FLR-N
PAST TOP PICK
Jul 12, 2018
Stock price when the opinion was issued
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re: 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.
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.
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)Premium 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 contentPremium contentPremium contentPremium content
(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.