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Kirby (KEX), Maersk Enter Into Offshore Wind Partnership

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Kirby Corporation (KEX - Free Report) has signed a commercial agreement with Maersk Supply Service (Maersk) to provide the latter with barge transportation services for offshore wind towers and turbines. Maersk Supply Service has been selected by Empire Offshore Wind as the installation contractor for the project. KEX and Maersk’s contract is a 20-year framework agreement with the Empire Wind project, representing the first combined effort between the companies.

As part of the agreement, Kirby’s subsidiary, Kirby Offshore Wind, will provide barges and tugboats to transport wind towers and turbines from the South Brooklyn Marine Terminal to a Maersk wind turbine installation vessel (“WTIV”) in order to meet the Jones Act requirements. KEX plans to invest $80-$100 million for the construction of two American barge and tugboat units. Each barge will be equipped to transport next-generation turbines of 15 megawatt and above.

Kirby’s president and chief executive officer, David Grzebinski, said, “Kirby’s participation in this renewable energy space will not only grow Company earnings and returns, but will also greatly enhance our ESG product and service offerings in the coming years.” The development of the vessels is expected to create new jobs for U.S. mariners as well as at U.S. shipyards during the construction phase.

Kirby expects the wind turbine installations and the feeder barge services to commence in late 2025 or early 2026 once the construction of Maersk’s new WTIV is completed.

Zacks Rank & Key Picks

Kirby carries a Zacks Rank #4 (Sell).

Some better-ranked stocks within the broader Transportation sector are as follows:

USA Truck (USAK - Free Report) sports a Zacks Rank #1 (Strong Buy). The company’s earnings have surpassed the Zacks Consensus Estimate in three of the preceding four quarters (in line in one), the average surprise being 64.4%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of USA Truck have rallied more than 37% in the past six months.

GATX Corporation (GATX - Free Report) also carries a Zacks Rank #2 (Buy). The company has an impressive earnings surprise history. Its earnings have surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 27.7%.

Shares of GATX have also appreciated more than 37% in the past six months.

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