One of the leading distributors of pipes, valves and fittings,
MRC Global Inc.
) strengthened its relationship with
), with the latter awarding many contracts to the former.
Recently, MRC Global received a contract from BP Products
North America, Inc., a subsidiary of BP, to supply maintenance,
repair and operating (MRO) goods and services. The contract also
entails MRC Global to provide carbon and stainless steel pipe,
valves and fittings (PVF) and related materials, to another
subsidiary of BP, namely, BP Refining and Marketing North
America. The value of the contract, scheduled to expire in 2018,
Additionally, MRC Global entered into various downstream
contracts with other subsidiaries of BP including, BP Chembel NV
in Belgium, BP Chemicals Limited in the United Kingdom and BP
Europa SE - BP Nederland and BP Raffinadererij Rotterdam B.V. in
Earlier this month, MRC Global's subsidiary, McJunkin Red Man
Corporation inked an agreement with BP International Ltd. The
five-year agreement entails that McJunkin Red Man will provide
pipes, fittings and flanges to BP's Global Projects
These contracts aim at strengthening the long-term association
of the two companies. MRC Global and BP have been associated with
each other for the past 30 years. Over the past four quarters,
MRC Global has generated as much as $85 million of revenues from
BP, wherein downstream sales accounted for $42 million.
MRC Global had a disappointing third-quarter 2013, where
upstream sales declined 10.0% year over year to $588.1 million
and midstream sales were down 6.6% year over year to $377.3
million. Downstream sales in the quarter were $348.3 million,
down 11.5% year over year. However, management is optimistic of a
sequential improvement in all markets, including upstream,
downstream and midstream, in coming quarters.
MRC Global currently carries a Zacks Rank #3 (Hold). Some
better-ranked stocks in the same sector include
The Middleby Corporation
). While Xylem carries a Zacks Rank #1 (Strong Buy), Middleby
holds a Zacks Rank #2 (Buy).
BP PLC (BP): Free Stock Analysis Report
MIDDLEBY CORP (MIDD): Free Stock Analysis
MRC GLOBAL INC (MRC): Free Stock Analysis
XYLEM INC (XYL): Free Stock Analysis Report
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