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Great Lakes (GLDD) to Build First Jones Act Fallpipe Vessel

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Great Lakes Dredge & Dock Corporation (GLDD - Free Report) has inked a deal with Philly Shipyard, Inc. to build a fallpipe vessel for subsea rock installation for approximately $197 million.

Per the contract, this first U.S.-flagged Jones Act-based vessel will be owned, built, operated and crewed by American union workers. The vessel will carry and set down loads of rock on the seabed, laying scour protection for offshore wind farm foundations, cables and other structures.

The ship, which will have a length of 140.5 meters (461 feet) and a breadth of 34.1 meters (112 feet), will boost job and regional economic opportunities through the creation of a U.S.-based rock supply chain network. This vessel will support America’s growing offshore wind energy industry and the Biden administration’s ambitious 30 GW of offshore wind goal by 2030.

Lasse Petterson, Great Lakes’ president and chief executive officer, said, “Offshore wind will play a crucial role in helping the U.S. meet its decarbonization and clean energy goals. The unique, technologically advanced vessel we are constructing is an essential step towards building the marine infrastructure required for this new industry, which holds so much promise for our nation economically and environmentally.”

U.S. Dredging Operation Bodes Well

Great Lakes is the largest provider of dredging services in the United States. The company mainly banks on strong domestic dredging operations, high equipment utilization, solid project execution and savings from restructuring.

Zacks Investment ResearchImage Source: Zacks Investment Research

Shares of this Zacks Rank #4 (Sell) company have outperformed the industry in the past three months. Its shares have gained 9.1% compared with the industry’s 8.7% rally in the said period.

On Sep 30, the company teamed up with Project Vesta to address coastal erosion and climate change impacts. Again in September, it received multiple major dredging contracts for $261.3 million. In May, it was awarded several major dredging works in Alabama, Louisiana, Florida, Arkansas, Kentucky, Mississippi, Missouri and Tennessee. These contracts — which incorporate deepening, coastal protection and maintenance dredging work — are valued at $112.8 million.

We believe the company’s strong bidding ability, and project execution will boost its performance in 2021 and beyond. The Zacks Consensus Estimate for fourth-quarter 2021 earnings is currently pegged at 31 cents, indicating a 93.8% year-over-year improvement.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some Better-Ranked Stocks in Construction Sector

Comfort Systems USA, Inc. (FIX - Free Report) : This heating, ventilation, and air conditioning installation service provider presently sports a Zacks Rank #1.

Comfort Systems has a trailing four-quarter earnings surprise of 17.4%, on average. The Zacks Consensus Estimate for earnings per share for the current quarter has improved 7.1% in the past 30 days. Shares of FIX have jumped 108.6% in the past year.

Meritage Homes Corporation (MTH - Free Report) — a leading homebuilder of single-family homes — sports a Zacks Rank #1 at present.

Meritage Homes has a trailing four-quarter earnings surprise of 24.4%, on average. The Zacks Consensus Estimate for earnings for the current year indicates a 74.6% year-over-year surge. Shares of MTH have jumped 29.6% in the past year.

Beazer Homes USA, Inc. (BZH - Free Report) , a national homebuilder, currently sports a Zacks Rank #1.

Beazer Homes has a trailing four-quarter earnings surprise of 60.3%, on average. The Zacks Consensus Estimate for its earnings per share for the current year has improved 44% in the past seven days. Shares of BZH have jumped 58.1% in the past year.