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Deutsche Bank Starts Fluor (FLR) at Buy, Sees 39% Upside

May 9, 2013 7:16 AM EDT Send to a Friend
Get Alerts FLR Hot Sheet
Price: $77.58 -0.51%

Rating Summary:
    16 Buy, 8 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 23 | Down: 7 | New: 19
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Deutsche Bank initiates coverage on Fluor (NYSE: FLR) with a Buy. PT $84.00.

The analysts commented, "We believe risk-reward is attractive and street estimates are not accurately discounting the potential for accelerated revenue growth or margin expansion due to leverage to faster growing, higher margin energy/traditional
infrastructure segments."

They continued, "We expect FLR to benefit from favorable geographic exposure as oil & gas and traditional infrastructure capex shifts towards North America due to the development of shale gas assets and to developing economies such as Asia and EMEA. We expect the strategic EPC agreements with Dow, Shell and BASF to result in disproportionately larger share gains during the upcoming petrochemicals and GTL capacity build-outs occurring in the 2014-2017 timeframe. We also expect FLR to benefit from the non-US refinery capacity build out. Additionally, we expect FLR to benefit from an increase in infrastructure spending in the US. We also believe consensus is not accurately factoring the potential for margin expansion and see upside risk to street margin estimates as some of the larger oil & gas projects near completion and revenue mix shifts from lower margin mining projects to higher margin downstream/petrochemical projects."

For an analyst ratings summary and ratings history on Fluor click here. For more ratings news on Fluor click here.

Shares of Fluor closed at $61.79 yesterday.




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