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MRC Global (MRC) Exhibits Solid Prospects, Risks Persist

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MRC Global Inc. (MRC - Free Report) has been gaining from its extensive presence across several end markets, including upstream production, midstream pipelines, chemicals & refining, and gas utilities. This has been enabling it to tap into opportunities and neutralize operating risks associated with a single market. Of late, its business in the gas utility sector has been witnessing strength, driven by increasing customer activity. Notably, its businesses in the gas utility sector experienced year-over-year growth of 4% in first-quarter 2021.

Also, the company has been benefiting from lucrative contract wins and projects over time. During 2020, the company secured new contracts from CenterPoint, Noble Midstream and Ameren. Also, it renewed a number of five-year contracts with its gas utility customers, including the three largest — Dominion, PG&E and TECO Energy. Further, some multi-year contracts signed previously have been proving beneficial for the company.

Moreover, it remains focused on rewarding shareholders handsomely through dividend payments. In full-year 2020 and first-quarter 2021, the company used $24 million and $6 million, respectively, for paying dividends.

However, weakness across all sectors (with the exception of the gas utilities sector) amid the coronavirus outbreak has been weighing on its top-line performance. In the quarters ahead, low customer spending might continue affecting the company’s performance. With operations spread globally, the company’s performance is also exposed to risks arising from geopolitical issues, trade relations, adverse movements in foreign currencies and governmental policies.

In the past three months, this Zacks Rank #3 (Hold) stock has returned 24.4% compared with the industry’s growth of 5.7%.

Zacks Investment ResearchImage Source: Zacks Investment Research

Stocks to Consider

Some better-ranked stocks from the Zacks Industrial Products sector are Barnes Group, Inc. (B - Free Report) , Dover Corporation (DOV - Free Report) and Graco Inc. (GGG - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Barnes pulled off a trailing four-quarter earnings surprise of 19.45%, on average.

Dover pulled off a trailing four-quarter earnings surprise of 21.35%, on average.

Graco delivered a trailing four-quarter earnings surprise of 28.28%, on average.

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In-Depth Zacks Research for the Tickers Above


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Graco Inc. (GGG) - free report >>

Dover Corporation (DOV) - free report >>

MRC Global Inc. (MRC) - free report >>

Barnes Group, Inc. (B) - free report >>