Fluor (FLR) Gears Up to Report Q3 Earnings: What's in Store?
Fluor Corporation FLR is scheduled to report third-quarter 2023 results on Nov 3, before market open.
In the last reported quarter, Fluor’s adjusted earnings and revenues beat the Zacks Consensus Estimate by 111.1% and 9%, respectively. This engineering, procurement, construction and maintenance services provider’s second-quarter 2023 adjusted earnings and revenues grew 406.7% and 19.4% year over year, respectively.
Notably, Fluor topped the Zacks Consensus Estimate in one of the trailing four quarters and missed on other three occasions, with the average negative surprise being 5.3%.
Trend in Estimate Revision
The Zacks Consensus Estimate for the to-be-reported quarter’s earnings per share (EPS) has remained unchanged at 55 cents over the past 60 days. The estimated figure indicates significant growth from the year-ago EPS of 7 cents. The consensus mark for revenues is $3.84 billion, suggesting a 6.4% year-over-year improvement.
Fluor Corporation Price and EPS Surprise
Fluor Corporation price-eps-surprise | Fluor Corporation Quote
Factors to Note
The company is poised to see a boost in its quarterly performance, thanks to its recent cost-plus/low-risk bookings, its dedication to the "Building a Better Future" strategy, and its diversified presence in the market. Additionally, Fluor stands out as the foremost industry player in nuclear remediation for government facilities in the United States. The company is anticipated to profit from the increasing global energy demand. Nevertheless, Fluor's strong backlog performance is still being influenced by a few remaining legacy projects.
Segment-wise, our model predicts Energy Solutions revenues (comprising 43.7% of second-quarter 2023 total revenues) to be $1.62 billion, up 1.5% year over year.
We expect Urban Solutions (comprising 30.5% of second-quarter 2023 total revenues) to be $1.22 billion, up 1.3% sequentially.
Our model predicts Mission Solutions segment revenues (comprising 17.9% of second-quarter 2023 total revenues) to be $697.4 million, up 9.1% year over year.
Other segment (comprising 7.9% of second-quarter revenues) is expected to register comparable quarterly revenues with the second quarter at $310.9 million.
From the margin perspective, higher overhead costs, additional costs on a legacy infrastructure project, a lack of contractual protection for the supply chain and intense competition are expected to have weighed on the quarterly performance.
We expect the Energy Solutions segment operating margin to be 8.3% in the quarter, up from 3.7% a year ago. For Urban Solutions, our model predicts the operating margin to be 3.5% in the quarter. For the Mission Solutions segment, the operating margin is expected to be 5.8% in the quarter, down from 4.5% a year ago.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Fluor for the quarter to be reported. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. Unfortunately, this is not the case here, as you will see below.
Earnings ESP: Fluor has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: FLR currently carries a Zacks Rank #3.
Stocks With Favorable Combination
Here are some other companies in the Zacks Construction sector that have the right combination of elements to post an earnings beat on their respective quarters to be reported.
Louisiana-Pacific Corporation LPX has an Earnings ESP of +2.07% and carries a Zacks Rank #3.
LPX’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, with the average being 95.8%. Earnings for the to-be-reported quarter are expected to decline 19.2% year over year.
Dycom Industries DY has an Earnings ESP of +1.24% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
DY’s earnings topped the consensus mark in all the last four quarters, the average being 147.4%. Earnings for the to-be-reported quarter are expected to increase 4.7% year over year.
Construction Partners, Inc. ROAD has an Earnings ESP of +2.91% and sports a Zacks Rank #1.
ROAD’s earnings topped the consensus mark in three of the last four quarters, with the average being 10.6%. Earnings for the to-be-reported quarter are expected to rise 108% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Fluor Corporation (FLR) : Free Stock Analysis Report
Louisiana-Pacific Corporation (LPX) : Free Stock Analysis Report
Dycom Industries, Inc. (DY) : Free Stock Analysis Report
Construction Partners, Inc. (ROAD) : Free Stock Analysis Report
