McDermott International (MDR) Stock Rating Upgraded by Zacks Investment Research
Zacks Investment Research upgraded shares of McDermott International (NYSE:MDR) from a sell rating to a hold rating in a report issued on Monday.
According to Zacks, “We appreciate McDermott’s broad product portfolio, diversified geographical footprint, good market position and strong relationship with national oil companies. MDR's $6 billion merger deal with Chicago Bridge & Iron bode well as it will lead to a fully integrated onshore-offshore company. The increased scale and diversification will also boost its growth prospects and lead to cost efficiencies. However, even though the merger adds onshore services to the company, a considerable portion of MDR’s current backlog is still associated with offshore operations, and thus remains susceptible to the pricing weakness. Further, with the merger, MDR will also end up assuming the high debt load of Chicago Bridge and Iron. Therefore, even though MDR in itself displays strong financials, the post merger entity will carry a debt load of around $2 billion which could mar its credit metrics. Thus we take a cautious stance on the stock.”
Several other research analysts have also issued reports on MDR. KeyCorp restated a hold rating on shares of McDermott International in a research report on Friday, November 10th. Credit Suisse Group reduced their price target on McDermott International from $7.60 to $7.30 and set a neutral rating on the stock in a research report on Thursday, November 2nd. Scotiabank reaffirmed a buy rating and set a $9.00 price objective on shares of McDermott International in a research note on Wednesday, November 1st. Deutsche Bank dropped their price objective on McDermott International from $6.50 to $5.25 and set a hold rating on the stock in a research note on Tuesday, October 24th. Finally, ValuEngine raised McDermott International from a buy rating to a strong-buy rating in a research note on Monday, November 6th. Two equities research analysts have rated the stock with a sell rating, six have given a hold rating and four have assigned a buy rating to the stock. McDermott International has an average rating of Hold and a consensus price target of $7.59.
McDermott International (NYSE:MDR) last posted its quarterly earnings results on Wednesday, November 1st. The oil and gas company reported $0.33 earnings per share (EPS) for the quarter, topping the Thomson Reuters’ consensus estimate of $0.19 by $0.14. McDermott International had a return on equity of 9.56% and a net margin of 5.25%. The business had revenue of $958.50 million for the quarter, compared to analyst estimates of $977.28 million. During the same period last year, the company earned $0.09 EPS. The firm’s revenue was up 71.6% on a year-over-year basis. sell-side analysts predict that McDermott International will post 0.52 earnings per share for the current year.
A number of institutional investors have recently modified their holdings of the stock. Schwab Charles Investment Management Inc. raised its stake in McDermott International by 0.9% during the 4th quarter. Schwab Charles Investment Management Inc. now owns 2,925,543 shares of the oil and gas company’s stock worth $19,251,000 after buying an additional 25,917 shares during the period. Convergence Investment Partners LLC acquired a new stake in McDermott International during the 4th quarter worth $962,000. Louisiana State Employees Retirement System raised its stake in shares of McDermott International by 6.2% in the 4th quarter. Louisiana State Employees Retirement System now owns 122,200 shares of the oil and gas company’s stock valued at $804,000 after purchasing an additional 7,100 shares during the period. GSA Capital Partners LLP acquired a new stake in shares of McDermott International in the 3rd quarter valued at about $2,181,000. Finally, Neuberger Berman Group LLC raised its stake in shares of McDermott International by 21.7% in the 3rd quarter. Neuberger Berman Group LLC now owns 1,951,233 shares of the oil and gas company’s stock valued at $14,185,000 after purchasing an additional 347,995 shares during the period. 86.10% of the stock is currently owned by institutional investors and hedge funds.
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McDermott International Company Profile
McDermott International, Inc is a provider of integrated engineering, procurement, construction and installation (EPCI), front-end engineering and design (FEED) and module fabrication services for upstream field developments across the world. The Company delivers fixed and floating production facilities, pipeline installations and subsea systems from concept to commissioning for offshore and subsea oil and gas projects.
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