Fluor Corporation ( FLR Quick Quote FLR - Free Report) has secured a construction contract from the Texas Department of Transportation (TxDOT), for which the company will book the nearly $548 million contract value in the second quarter of 2022. Construction is slated to begin in late 2022, with completion expected in late 2027. Shares of this engineering, procurement, and construction service provider lost 1.4% during the trading hours on Jun 8 but rose 2.6% in after-hours trading the same day. TxDOT selected Fluor for the Interstate 35 (I-35) Capital Express South project in Austin, TX, which is the first in a series of vital infrastructure projects to rebuild the I-35 corridor in Austin. This 9-mile project will add two non-tolled high-occupancy vehicle-managed lanes in each direction along I-35 from U.S. 290 West/State Highway 71/Ben White Boulevard to State Highway 45 Southeast. Fluor will combine at-grade and elevated lanes in the median, reconstruct bridges and frontage roads, add a shared-use pedestrian and bicycle path, and enhance safety and mobility improvements. Thomas Nilsson, president of Fluor’s Infrastructure business, said, “This new award is a continuation of Fluor’s Texas-centric infrastructure focus and reinforces the strength of our relationships with state and local officials across the state.” U.S. Administration’s Infrastructural Push Is a Boon
Fluor and other engineering service providers are expected to benefit from strong global trends in infrastructure modernization, energy transition, national security, and a potential super-cycle in global supply chain investments. A significant boost in infrastructural and public construction spending to underscore the need for rebuilding the nation’s deteriorating roads and bridges and funding new climate resilience and broadband initiatives is a boon for Fluor.
Notably, Fluor has been designing and building infrastructure projects in Texas for almost 20 years and is currently executing the I-635 LBJ East, Southern Gateway and I-35E projects in Dallas; the Oak Hill Parkway project in Austin; and performing capital maintenance for the Horseshoe project in Dallas. For first-quarter 2022, the ending backlog totaled $19.3 billion and total backlog was $19.25 billion. Management expects bookings to be solid for the rest of 2022, helping it to achieve a $2.50-$2.90 per share gross margin by 2024. Image Source: Zacks Investment Research
Among the major industry bellwethers, Fluor appears to be highly attractive to investors. Shares of the company have risen 17.4%, outperforming the Zacks
Engineering - R and D Services industry’s 0.9% rise so far this year. Zacks Rank
FLR currently carries a Zacks Rank #3 (Hold). You can see
. the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here 3 Top-Ranked Construction Stocks to Buy
Some top-ranked stocks, which warrant a look in the Construction sector, are
NVR, Inc. ( NVR Quick Quote NVR - Free Report) , Patrick Industries ( PATK Quick Quote PATK - Free Report) and Beazer Homes USA ( BZH Quick Quote BZH - Free Report) . NVR, also carrying a Zacks Rank #1, is engaged in the construction and sale of single-family detached homes, townhomes and condominium buildings, all of which are primarily constructed on a pre-sold basis. In order to serve homebuilding customers, NVR operates a mortgage banking and title services business. NVR’s expected earnings growth rate for the current year is 68.4%. The Zacks Consensus Estimate for current-year earnings has improved 20.4% over the past 60 days. Patrick Industries — carrying a Zacks Rank #2 (Buy) — is a leading component solutions provider for the RV, marine, and manufactured housing industries. Patrick Industries, like many others in the broader RV and consumer marine space, is seeing a massive run of revenue growth that began about a decade ago. Patrick Industries’ expected earnings growth rate for 2022 is 33.1%. The Zacks Consensus Estimate for current-year earnings has improved 16.6% over the past 60 days. Beazer Homes, carrying a Zacks Rank #2, designs, builds and sells single-family homes. BZH designs homes that appeal primarily to entry-level and first move-up homebuyers. Beazer Homes USA’s objective is to provide customers with homes that have quality and value. BZH’s subsidiary, Beazer Mortgage, originates the mortgages for the company's homebuyers. Beazer Homes’ expected earnings growth rate for fiscal 2022 is 48.9%. The Zacks Consensus Estimate for current-year earnings has improved 14.6% over the past 60 days.