Triple Contract Win for Orion Marine

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Orion Marine Group, Inc. (ORN), a leading heavy civil marine contractor, is believed to have one of the strongest dredging equipment in the industry. The company has won three contracts all this month to demolish and construct a fuel pier, a vessel bulkhead and a cargo dock. The three deals have a combined value of approximately $45 million.

The company is one of the leading providers of a broad range of marine construction and contracting services. Some of the company’s main customers include the U.S. Marine Transportation System and the cruise industry.

The US Navy had awarded Orion a $14 million contract on Dec 12 to upgrade its existing fuel pier in the Caribbean. In the same week, the US Navy had also awarded Orion another contract for constructing a vessel bulkhead that is required for mooring at Jacksonville in Florida. This contract is valued to be approximately $13 million. On Dec 19, the company received yet another $18 million contract to demolish and reconstruct a cargo dock in Louisiana at the Port of Lake Charles.

Orion plans to begin the onsite construction of all the three projects during the second quarter of 2014 and expects to complete them in 13 to 18 months approximately.

The deals cheered investors’ sentiment as the company’s shares have gained 6.5% from Dec 12 to date. In the last six months, Orion has received five such contracts. In August, the company had won a $15 million contract to partially dismantle and reconstruct a wharf

In addition, Orion had reported strong third-quarter results on Oct 31, witnessing a significant surge in both top- and bottom-lines. At the end of the third quarter, the company had an order backlog worth $216.5 million, which reflects the stable demand for the company’s product portfolio. Following the earnings release, analysts have revised their estimates upward for 2014.

Orion currently has a Zacks Rank #3 (Hold). Better-ranked stocks in the engineering and construction sector worth considering at the moment include VSE Corp. (VSEC), which carries a Zacks Rank #1 (Strong Buy), and Jiangsu Expressway Co. Ltd. (JEXYY) and Rexnord Corp. (RXN), both carrying a Zacks Rank #2 (Buy).

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