Company Reports

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core segments: energy solutions, urban solutions, and mission solutions.

No-moat Fluor's first-quarter revenue of $3.7 billion and adjusted EPS of $0.47 both missed FactSet consensus estimates of $3.9 billion and $0.54, respectively, sending shares down roughly 6% in intraday trading on May 3. We've raised our fair value estimate to $38 from $37, which reflects our slightly more optimistic operating margin projections and time value of money, and we see shares as fairly valued at current levels.

No-moat Fluor posted a $21 million net loss in the fourth quarter, as results included a $33 million project charge due to cost overruns and delays on a legacy upstream project. After rolling our model forward one year, we’ve trimmed our fair value estimate to $37 from $37.50, which reflects our slightly more muted near-term expectations.

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core segments: energy solutions, urban solutions, and mission solutions.

We’ve raised our fair value estimate for Fluor to $37.50 from $36 after the engineering and construction firm reported solid third-quarter results and increased its full-year outlook for the second time this year. The fair value adjustment is driven by Fluor’s outperformance as well as time value of money.

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core segments: energy solutions, urban solutions, and mission solutions.

We’ve increased our fair value estimate for Fluor to $36 from $33 after the engineering and construction firm posted strong second-quarter results and raised its guidance for full-year 2023. Management now anticipates revenue growth of 10%-15% (up from 10%), adjusted EBITDA of $500 million-$600 million (up from $450 million-$600 million), and adjusted EPS of $2.00-$2.30 (up from $1.50-$1.90). The fair value adjustment reflects the improved near-term revenue growth outlook and our slightly more optimistic midcycle margin assumption.

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core business segments: energy solutions, urban solutions, and mission solutions.

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core business segments: energy solutions, urban solutions, and mission solutions.

We are maintaining our $33 fair value estimate for no-moat Fluor after the engineering & construction firm reported mixed first-quarter results. While revenue was up 20% from the prior-year period, Fluor posted a $107 million net loss driven by $80 million in charges on two legacy projects as well as a $60 million negative earnings impact from the sale of Ameco South America. Management expects full-year cash flow to be modestly positive, even with around $200 million for legacy project cash needs.

Following Fluor’s fourth-quarter earnings release, we have increased our fair value estimate to $33 from $26.50 and upgraded our Morningstar Uncertainty Rating to High from Very High. We had previously assigned the engineering & construction firm a Very High Uncertainty Rating due to the risk of further cost overruns as Fluor’s fixed-price exposure was elevated. Nonetheless, we believe that a High Uncertainty Rating is now appropriate as the company has meaningfully lowered the risk profile of its backlog, having reduced its fixed-price exposure to 37% from 59% at the end of 2021. Fluor is on pace to reach management’s target of lowering the fixed-price exposure to 25% by 2024.

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core business segments: energy solutions, urban solutions, and mission solutions.

Following no-moat-rated Fluor’s third-quarter earnings release, we’ve bumped our fair value estimate up to $26.50 from $25.50, which reflects our more optimistic long-term revenue growth projections, partially offset by our lowered forecast for 2022. Management expects fourth-quarter adjusted EPS of $0.50-$0.60, which implies full-year 2022 adjusted EPS of $0.89-$0.99 (down from $1.15-$1.35 previously).

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core business segments: energy solutions, urban solutions, and mission solutions.

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core business segments: energy solutions, urban solutions, and mission solutions.

We do not expect to significantly alter our $25.50 fair value estimate for no-moat-rated Fluor following the engineering and construction firm’s second-quarter earnings release. Trading in 3-star territory, we view Fluor as fairly valued at current levels.

Nothing in no-moat Fluor’s first-quarter earnings results materially alters our long-term outlook for the engineering and construction firm. Therefore, we are maintaining our $25.50 fair value estimate. We see the name as fairly valued at current levels, with shares trading in 3-star territory.

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core business segments: energy solutions, urban solutions, and mission solutions.

Fluor is one of the largest global providers of engineering, procurement, construction, fabrication, operations, and maintenance services. The firm serves a wide range of end markets including oil and gas, chemicals, mining, and transportation. Fluor operates three core business segments: energy solutions, urban solutions, and mission solutions.

No-moat-rated Fluor’s full-year 2021 adjusted EPS of $0.94 came in above our $0.89 estimate. After rolling our model forward one year, we’ve bumped our fair value estimate for Fluor to $25.50 from $24.50, mostly due to time value of money as well as reversing the implementation of a probability-weighted change in the U.S. statutory tax rate in our model. We see Fluor as modestly undervalued at current levels, with the stock trading in 4-star territory.