Has Barnes Group (B) Outpaced Other Industrial Products Stocks This Year?
In the past three months, shares of Fluor Corporation FLR have appreciated 14.6% against the industry’s decline of 11.1%.
The company has managed to impress investors with its recent earnings streak, beating estimates thrice in the trailing four quarters. We believe Fluor’s dominant position in nuclear remediation at government facilities, with its market diversity and strong focus on streamlining business structure might continue to be growth drivers, going ahead.
Given this backdrop, let’s delve deeper to find out the key factors that make this Zacks Rank #1 (Strong Buy) company an attractive proposition for investors right now. You can see the complete list of today’s Zacks #1 Rank stocks here.
Factors at Play
Fluor is an industry leader in nuclear remediation at government facilities throughout the United States. The company is likely to benefit from the rising demand for energy across the world. Notably, with global electricity demand on a steady rise, nuclear energy seems to be emerging as one of the best alternatives to the world’s dependence on a finite oil supply and subsequent environmental degradation.
Moreover, the company’s strategy of maintaining a good business portfolio mix enables it to focus on more stable business markets and capitalize on developing the cyclical markets at suitable times.
Meanwhile, the company remains optimistic about its end markets, including mining. This is because the leading indicators for future capital spending like industrial production and capacity utilization are improving in several industries, which signal higher capital spending, moving ahead. Fluor also anticipates an increase in front-end engineering awards, which should boost future growth. Fluor’s investment projects are encouraging, particularly on LNG projects in North America, including the LNG Canada project for Shell, chemical facilities as well as pipeline projects in the United States. Further, commercial markets, comprising life sciences and infrastructure, are likely to improve going forward. This, in turn, might secure multiple awards for these industries over the next several quarters.
Furthermore, the company maintains a strong focus on enhancing its competitive position in the market through prudent leadership initiatives and strategic alliances. In this regard, Fluor has undertaken a restructuring initiative under its construction and fabrication operations to improve control and delivery of projects. This apart, the company plans to implement data analytics to projects that will help it in minimizing risks and maximizing returns. These initiatives are expected to give Fluor a distinct competitive advantage.
Other Stocks to Consider
Some other stocks worth considering from the same spaceinclude Potlatch Corporation PCH, Louisiana-Pacific Corporation LPX and Rayonier Inc. RYN. While Potlatch and Louisiana-Pacific sport a Zacks Rank #1, Rayonier carries a Zacks Rank #2 (Buy).
Potlatch has surpassed estimates thrice in the trailing four quarters, with an average positive earnings surprise of 36.9%.
Louisiana-Pacific has outpaced estimates twice in the preceding four quarters, with an average earnings surprise of 5.2%.
Rayonier has surpassed estimates thrice in the trailing four quarters, with an average positive earnings surprise of 109.9%.
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