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Soleil Securities is Transitioning Coverage on Michael Baker (BKR), Major Uncertainties Lead to Hold Rating

June 16, 2011 12:51 PM EDT
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Price: $32.39 +0.22%

Rating Summary:
    19 Buy, 11 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 20 | Down: 14 | New: 22
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Soleil Securities is transitioning coverage on shares of Michael Baker (NYSE: BKR) with a Hold rating as it believes that shares are currently fairly valued.

The company was announced as one of the seven design-build teams eligible to bid on up to $4 billion worth of development projects on the island of Guam. Contracts will begin to be awarded as soon as U.S. and local authorities negotiate the details of the plan to move U.S. forces from Okinawa, Japan, to Guam.

The firm estimates that this project could be valued at $75-$90 million from the U.S. Army. BKR also responded to an RFP from Japanese authorities for a development project of similar size.

The extension of the Federal Surface Transportation Act by Congress will provide funding until the end of September. The firm notes that it is concerned that the projects in the U.S. could see additional delays or possible downsizing given the current mantra of fiscal restraint.

Soleil Securities is releasing its 2011 revenue estimate at $505.5 million, gross profit or $92.6 million, EBITDA of $29.5 million, operating income of $18.7 million, and net income from continuing operations of $11.4 million or $1.22 per share. For 2012 it estimates revenue of $534.2 million, gross profit of $100 million, EBITDA of $40.2 million, operating income of $29.6 million, and net income from continuing operations of $18.1 million, or $1.90 per diluted share.

For more ratings news on Michael Baker click here and for the rating history of Michael Baker click here.

Shares of Michael Baker closed at $25.37 yesterday.


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