) has been on uptrend since the beginning of February, with
shares rising 3.2% in the month reflecting investors' enthusiasm
about its developments so far.
Among others, ABB received a contract worth $56 million from
the power transmission utility company, Power Grid Corporation of
India Ltd. The scope of the contract requires ABB to provide core
power products including switchgear and transformers.
The company will be offering two types of ultrahigh voltage
single-phase shunt reactors: 26 units of 80
MegaVolt-amperes-reactive (MVAr) and 10 units of 110 MVAr, 765
kiloVolt (kV). These transformers and shunt reactors will be
deployed at four upcoming substations in southern and eastern
These substations, when functional, would significantly
strengthen India's power transmission grid. ABB's expertise in
providing similar turnkey solutions would aid it to fulfill the
requirements of this project.
Prior to this, the company received a similar contract valued
at $60 million from Canada's power utility company, Hydro-Québec
for upgrading its power grid. The company received another $55
million contract from Dudgeon Offshore Wind Ltd. to supply an
underwater power cable system for a wind farm in Norfolk.
Moreover, this month, ABB collaborated with Shenzhen BYD Daimler
New Technology Co., Ltd. (BDNT) to provide direct current fast
chargers for electric vehicles in China.
These strategic contracts would strengthen the company's
business, especially its Power Products segment which reported
merely 1% sales growth in terms of local currency in the last
reported quarter (fourth-quarter 2013).
Going forward, the company's operational performance is likely
to be bolstered further by the growing global demand for
industrial and power distribution, along with increasing
investment in power transmission solutions.
These, in turn, are expected to fortify its financial position in
the coming quarters.
Moreover, as per the sources, ABB is actively pursuing
divestment opportunities to streamline its product portfolio and
increase focus on core businesses.
However, this Zacks Rank #5 (Strong Sell) diversified
industrial has not seen any upward estimate revisions over the
past few weeks. The latest price appreciation is certainly
encouraging, but make sure to keep a close watch of this firm in
the near future before investing in it.
Some better-ranked stocks that are worth considering at the
AECOM Technology Corp
Quanta Services Inc
). All of these have a Zacks Rank #2 (Buy).
ABB LTD-ADR (ABB): Free Stock Analysis Report
AECOM TECH CORP (ACM): Free Stock Analysis
ENERSYS INC (ENS): Free Stock Analysis Report
QUANTA SERVICES (PWR): Free Stock Analysis
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