McDermott International, Inc. MDR recently provided an encouraging first-quarter 2018 operational update, while reaffirming its guidance for the whole year. The company thanked solid backlog conversation in its operational areas along with successful execution of its cost-saving plans for the positives. Following the news, the stock jumped 6.7% in the last session.
The company expects its top line for the Jan-Mar quarter to be in the range of $600-$610 million, much higher than the year-ago figure of $519.4 million. The Zacks Consensus Estimate shows revenues to be $590.8 million. Moreover, McDermott expects its EPS for the quarter to be in the range of 10-12 cents.
Per McDermott, cost saving efforts like the Fit2Grow initiative played crucial roles in this quarter. The Fit2Grow initiative alone helped the company in generating $15 million in savings. Moreover, McDermott expects its operating margin in the quarter to be in the range of 10-10.7%.
The company — anticipated to report first-quarter earnings around Apr 24 — expects its total backlog in the quarter to be around $3.4 billion, slightly lower than the Zacks Consensus Estimate of $3.8 billion.
We note that the company delivered a positive average earnings surprise of 247.1% in the last four quarters, thrice beating the Zacks Consensus Estimate.
2018 Guidance
McDermott reaffirmed its preliminary 2018 guidance, issued on Feb 21. The Houston, TX-based service provider expects its full-year revenues to be in the range of $3.1-$3.3 billion. Moreover, the company anticipates its EBITDA to be within the $340-$365 million range. Additionally, net income is anticipated to be approximately between $120 and $145 million. The company foresees its free cash flow to range within $195-$235 million. The EPS is estimated to lie between 42 cents and 52 cents.
Price Performance
McDermott has gained 1.7% in the past year against 14% fall of its industry.
Zacks Rank and Stocks to Consider
No Comments