) reached a 52-week high of $66.83 on Monday, Apr 1, 2013
following its solid fourth quarter 2012 results, strong
double-digit growth in Oil & Gas and Global Services and
strength in Industrial & Infrastructure segments.
The closing price of the engineering conglomerate on Apr 1,
2013 was $65.44, representing a robust one-year return of about
7.0% and year-to-date return of about 7.3%. Average volume of
shares traded over the last three months stood at approximately
Fluor delivered a positive earnings surprise in the last four
quarters with an average beat of 32.2%. This Zacks Rank #3 (Hold)
company has a market cap of $10.6 billion and a long-term
expected earnings growth rate of 12.7%.
Solid Fourth Quarter Results
Fluor Corporation reported fourth-quarter 2012 earnings per
share from continuing operations of $1.58, well above the Zacks
Consensus Estimate of earnings per share of 68 cents.
Total revenue was $7.02 billion in fourth quarter of 2012
compared with $6.25 billion in the fourth quarter of 2011.
Consolidated backlog at the end of the year was $38.2 billion
compared with $39.5 million at the end of 2011.
Revenue from the Oil & Gas segment was $9.5 billion in
2012, up 19% year over year, driven by new awards and good order
backlog. New awards won during the year were approximately $12.6
billion with backlog amounting to $18.2 billion. Petrochemical
projects in North America, Europe and Asia aided backlog of the
Industrial & Infrastructure revenue was $12.2 billion, an
increase of 26% year over year. The rise was due to increased
mining and metals business. New awards won during the year were
$9.5 billion with backlog amounting to $15.5 billion at the end
of the year.
New awards in 2012 were strong at $27.1 billion, compared with
bookings of $26.9 billion a year ago, including $12.6 billion in
Oil & Gas and $9.5 billion in Industrial &
Management is positive about an upbeat performance in the year
2013, given its strength in the oil & gas segment and the
Industrial Infrastructure segment. Further, the company is
strengthening its position in the metals and mining segment
(which is included in the Industrial Infrastructure segment).
The company maintained its 2013 earnings per share guidance of
$3.85 - $4.35. Fluor derives significant benefits from diverse
Series of Contracts for Fluor
On Mar 15, Fluor received a contract from Crosslands
Resources, an Australian mining company, to conduct a study
regarding the feasibility of the Jack Hills Expansion Project
located in Western Australia. Fluor will be responsible for
analyzing, upgrading and finalizing the initial analysis of the
extensive expansion project of Iron Ore Mine conducted by the
Strategic Asset Review department of Fluor. The company is
optimistic about this contract and expects it to boost its Metal
and Mining business.
On Mar 12, Fluor received a FEED (Front-End Engineering and
Design) contract jointly from Qatar Petroleum and Shell for
Al-Karaana Petrochemicals Complex in Ras Laffan Industrial City,
Qatar. The project is expected to be the foundation for future
petrochemical development projects in the Middle East. It will be
a world-scale ethane-based cracker and derivatives complex,
including two train mono ethylene glycol units using Shell's
proprietary OMEGA (Only MEG Advantaged) technology. Fluor is
extremely hopeful that the project will not only strengthen the
company's long-standing relationship with both Qatar Petroleum
and Shell but will also realize record revenue growth in the
upcoming quarter since the Middle East is an important area of
operations for Fluor. This project can prove to be a launch pad
for the company's future business developments in Qatar.
In addition, the company also settled a lawsuit against the
company's management of the Hazardous Materials Management and
Emergency Response (HAMMER) facility.
The Zacks Consensus Estimates for 2013 and 2014 rose 0.2% and
0.6% to $4.17 and $4.70, respectively, in the past 30 days. One
estimate moved upward for 2013 and 2014, respectively, over the
same time frame.
However, none of the estimates moved downward for 2013 and
2014 in the past 30 days.
We expect the growth in the oil & gas segment and the
metals and mining business to be the key drivers for Fluor's
Other Stocks to Consider
Other stocks in the technology industry that are currently
performing well and have solid visibility include
AECOM Technology Corp
Chicago Bridge & Iron
Jacobs Engineering Group Inc
). All these stocks carry a Zacks Rank # 2 (Buy).
AECOM TECH CORP (ACM): Free Stock Analysis
CHICAGO BRIDGE (CBI): Free Stock Analysis
FLUOR CORP-NEW (FLR): Free Stock Analysis
JACOBS ENGIN GR (JEC): Free Stock Analysis
To read this article on Zacks.com click here.