Barclays maintains an 'Equalweight' on The Shaw Group (SHAW); FY2Q11 Review: Solid Bookings Offset Messy Quarter; Nuclear Slowly Ramping
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Price: $47.61 --0%
Rating Summary:
4 Buy, 5 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
4 Buy, 5 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Barclays maintains an 'Equalweight' on The Shaw Group (NYSE: SHAW), PT $41.
Barclays analyst says, "While SHAW's FY2Q11 EPS was choppier than we'd like to see, we think investors will likely look through the messy result and focus on the quarter's solid bookings and an improving backlog. Bookings were broad based but particularly strong in Power ($1.1bn vs. our $300mm) and Energy & Chemicals ($257mm vs. our $100mm), which seems to indicate that other areas of its business (outside of nuclear) are beginning to improve. SHAW still appears to be working through execution issues (the quarter included a $0.11 charge on a legacy E&C project), which makes us somewhat uncomfortable forecasting meaningful margin expansion going forward. On the other hand, we agree with Shaw management that at least some of its new nuclear opportunities will eventually go forward, and we are relatively optimistic about continued power and E&C backlog growth over the short to medium term. In addition, we think investors should be encouraged by SHAW's recent cash deployment/stock repurchases, which could be a nice tailwind to EPS in 2H11 and FY12."
"We add back Westinghouse interest and income (which we view as recurring) to get FY2Q11 EPS of $0.34 vs. our $0.46. Management lowered FY11 EPS guidance to $1.86-$1.91 from $1.86-$1.96."
For more ratings news on The Shaw Group click here and for the rating history of The Shaw Group click here.
Shares of The Shaw Group closed at $34.97 yesterday.
Barclays analyst says, "While SHAW's FY2Q11 EPS was choppier than we'd like to see, we think investors will likely look through the messy result and focus on the quarter's solid bookings and an improving backlog. Bookings were broad based but particularly strong in Power ($1.1bn vs. our $300mm) and Energy & Chemicals ($257mm vs. our $100mm), which seems to indicate that other areas of its business (outside of nuclear) are beginning to improve. SHAW still appears to be working through execution issues (the quarter included a $0.11 charge on a legacy E&C project), which makes us somewhat uncomfortable forecasting meaningful margin expansion going forward. On the other hand, we agree with Shaw management that at least some of its new nuclear opportunities will eventually go forward, and we are relatively optimistic about continued power and E&C backlog growth over the short to medium term. In addition, we think investors should be encouraged by SHAW's recent cash deployment/stock repurchases, which could be a nice tailwind to EPS in 2H11 and FY12."
"We add back Westinghouse interest and income (which we view as recurring) to get FY2Q11 EPS of $0.34 vs. our $0.46. Management lowered FY11 EPS guidance to $1.86-$1.91 from $1.86-$1.96."
For more ratings news on The Shaw Group click here and for the rating history of The Shaw Group click here.
Shares of The Shaw Group closed at $34.97 yesterday.
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