Hi Grommit - I doubled up on my shares of Shaw Group Inc. (SHAW). With the recent sell off, their forward PE is now around 10 based on the average analysts estimates well below FLR which now sell at a 13.3 PE.
SHAW's 2008 joint venture w/ Westinghouse Electric Company (a subsidiary of Toshiba) should contribute to future earnings.
Westinghouse to get share of $20 billion nuclear deal
pittsburghlive.com.
By The Tribune-Review Tuesday, December 29, 2009
The United Arab Emirates awarded a South Korean consortium a prized $20 billion deal to build nuclear reactors as the oil-rich Persian Gulf nation races to meet its booming energy needs.
Korea Electric Power Corp.'s winning bid beat out rival offers. Emirates Nuclear Energy Corp. valued the deal for four 1,400-megawatt reactors at about $20 billion — considerably less than some estimates suggested.
The Korean consortium includes Samsung, Hyundai and Doosan Heavy Industries. Japan's Toshiba Corp. and its Westinghouse subsidiary will also play a role.
One billion dollars is expected to go to Westinghouse, headquartered in Cranberry. Westinghouse will provide major components, instrumentation and control equipment, and design technical and engineering support services, mostly from Westinghouse locations in Western Pennsylvania.
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I like SHAW's per share cash position which is fueled by their large Free Flow Cash Flow generated from their different "Service" divisions. Also, this company creates "real" productive U.S. jobs and it is one of only a few companies in the world where business is outsourced to them from China & India.
If they started to pay a dividend, I might consider as a core portfolio position. I may consider selling some covered calls on any run above $35. Stock is selling just below it's 50day MA of $28.50 and is well below its 50week MA of $36.00/share.
My basket of construction/engineering companies so far include FLR 55% & SHAW 45%. They represent 1.9% of the portfolio. If I can buy at 10 PE or lower I will up my exposure, These are the companies in my watch list.
finance.yahoo.com
EKS |
