Orion Marine Group, Inc. (ORN), a leading heavy civil marine contractor serving the infrastructure sector, recently won a $15 million contract. The deal requires Orion to partially dismantle and reconstruct a wharf.
Additionally, according to the agreement, Orion will be responsible for installing new crane rails for the Port of Tacoma in Tacoma, Wash. Orion expects to begin the onsite construction during third-quarter 2013 and complete the project in approximately 13 months.
The contract is the second of its kind procured by Orion in the last two months. Recently, the company had received a contract award of $20 million in the Gulf Coast region. The scope of the contract primarily involved constructing and dredging a new ship dock for a private client in the region.
Orion is believed to have one of the strongest dredging equipments in the industry. Some of the company’s main customers include the U.S. Marine Transportation System and the cruise industry. The company is one of the leading providers of a broad range of marine construction and contracting services.
However, of late, Orion’s share prices witnessed a downturn after it missed its second-quarter earnings estimates. Shares of Orion were down about 5.4% after the quarterly results and closed at $10.42 on Aug 13, after touching a low of $9.90 on Aug 7. The second-quarter results were posted on Aug 1. Earnings per share came in at a penny, which was below the Zacks Consensus Estimate of 3 cents. However, it improved from a loss of 20 cents in the same quarter last year.
Post the earnings miss, analysts have revised their estimates downwards for both 2013 and 2014. The Zacks Consensus Estimate for 2013 is now 11cents, down from 14 cents before the second-quarter earnings release. The 2014 consensus is currently pegged at 29 cents, down from the previous estimate of 36 cents over the last 30-day period.
With falling estimates, investors should remain cautious about this stock which currently has a Zacks Rank #5 (Sell). Better-placed stocks within the industry that are worth a look include MasTec, Inc. (MTZ), Primoris Services (PRIM) and Meritage Homes Corporation(MTH). All these stocks carry a Zacks Rank #2 (Buy).Read the Full Research Report on ORN
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