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MRC Global Secures PVF Contract Renewal From DCP Midstream

Zacks Equity Research

MRC Global Inc. MRC recently reinforced its long-term relationship with DCP Midstream Partners, LP DCP, on the back of a five-year pipe, valve and fitting (PVF) contract renewal. The stock remained nearly flat at $18.5 per share as of Jan 18, prior to the newscast.

MRC Global provides PVF services to the DCP Midstream stores located at various locations. Notably, the company caters project PVF requisites of DCP Midstream in more than 30 service locations across North America.

Notably, MRC Global has the appropriate product know-how, location footprint (especially in Denver Basin and Permian Basin) and inventory to support the exact supply-chain goals of DCP Midstream.

As per the contract renewal, MRC Global’s business subsidiary in the United States will supply PVF services and products for another five years. The contract comprises project and maintenance, as well as repair and operations work.

Troubling Factors  

Over the last three months, MRC Global’s shares have gained 4.3%, underperforming 21.2% growth recorded by the industry.

Reduced customer spending has been weighing over the top-line performance of the company’s international segment since 2015. Moreover, surge in oil prices is hurting the downstream businesses of this Zacks Rank #4 (Sell) company. Also, headwinds such as unfavorable foreign currency-translation impact, stiff industry rivalry and input price inflation remain key causes of concern.  

Stocks to Consider

Two better-ranked stocks within the Zacks Classified Industrial Products Sector are listed below:

Acco Brands Corporation ACCO currently carries a Zacks Rank of 2 (Buy). The company has pulled off a positive average earnings surprise of 81.89% in the last four quarters. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Applied Industrial Technologies, Inc. AIT also holds a Zacks Rank of 2. The company generated a positive average earnings surprise of 9.71% during the same time frame.

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Applied Industrial Technologies, Inc. (AIT) : Free Stock Analysis Report
 
Acco Brands Corporation (ACCO) : Free Stock Analysis Report
 
MRC Global Inc. (MRC) : Free Stock Analysis Report
 
DCP Midstream Partners, LP (DCP) : Free Stock Analysis Report
 
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