Core Insights - Fluor Corp. is positioned to benefit from macroeconomic trends in energy, electricity, AI data centers, and infrastructure, with a growing backlog including a rare earth magnet manufacturing plant in Texas [1][2] - The stock is currently nearly 30% off its July highs, presenting an opportunistic investment for those looking to diversify from high-flying tech stocks [2] - Despite a disappointing second-quarter earnings report and reduced 2025 earnings guidance due to project delays and cost overruns, Fluor's third-quarter update showed improved full-year earnings estimates and profits from its investment in NuScale Power [4][5] Financial Performance - Fluor's market capitalization stands at $6.4 billion, with a current stock price of $39.70 and a gross margin of -28.87% [7] - The company's backlog exceeds $20 billion, particularly in its Urban Solutions segment, with recent project awards in metals and mining, including a copper mining project and an engineering design contract for a rare earth magnet plant [7] - The stock has experienced a decline of 1.48% recently, with a 52-week range of $29.20 to $57.50 [7] Future Prospects - Fluor anticipates growth driven by the expansion of domestic manufacturing capacity by pharmaceutical companies and an increase in data center construction [8] - The company is well-positioned for a rebound, with expectations of significant growth in power generation and delivery infrastructure over the coming years [9] - Current market conditions suggest a favorable investment opportunity, as bad news has driven the stock lower, potentially allowing for profitable long-term investments [10]

Core Viewpoint - Fluor is facing significant near-term challenges, including a stock decline of 20% in 2025, while the S&P 500 rose by 17% during the same period [1] Financial Performance - Fluor's second-quarter earnings report on August 1 missed analysts' expectations, leading to a reduction in its full-year outlook and the disclosure of cost overruns, scheduling delays, and design problems in major projects [2] - Revenue for Fluor increased by 5% in 2024, but adjusted EBITDA fell by 14% due to lower profits from its energy solutions segment and fewer contracts [7] - On a GAAP basis, Fluor's earnings per share surged from $0.54 in 2023 to $12.30 in 2024, primarily due to the sale of shares in NuScale Power [8] Legal and Operational Issues - The unexpected guidance reduction and execution issues led to a class action lawsuit from investors alleging misleading statements regarding growth prospects [4] - Fluor agreed to pay $653 million to Santos to resolve a legal dispute, which was recorded as a revenue reduction, further impacting its financial performance [5] Backlog and Contracting - Fluor's backlog shrank year over year for four consecutive quarters, as it completed existing projects faster than it could secure new contracts [9] - The company shifted towards smaller, lower-risk contracts to diversify its business and reduce dependence on large infrastructure projects [10] Future Outlook - Analysts expect Fluor's revenue and EBITDA to decline by 4% and 19% respectively for the full year, but anticipate a recovery in 2026 with expected increases of 7% and 10% [11] - The company's low valuation, with an enterprise value of $4.5 billion, suggests limited downside potential, and activist investor Starboard Value is pushing for monetization of its stake in NuScale [12] - If Fluor resolves its execution issues and grows its backlog, there is potential for gradual stock price recovery over the next 12 months [13]

Group 1: Company Performance - Fluor's shares reached a 52-week high of $57.50 on July 31, 2025, but fell sharply the next day after reporting lower revenue and earnings due to high costs from subcontractor errors and an arbitration ruling related to a Mexican project [1] - As of November 14, 2025, Fluor's shares were priced at $42.39, reflecting a 16.56% decline over the past year, while the S&P 500 index gained 13.2% during the same period [3] - Fluor's backlog decreased by 13% year over year to $28 billion, indicating a slowdown in key end markets [1] Group 2: Strategic Moves - Fluor is focusing on monetizing its stake in NuScale Power, a nuclear energy start-up, where it held a majority stake [5] - The company received $605 million in net proceeds from the sale of its NuScale Power stake and plans to sell its remaining stake in the second quarter of 2026 [6] - In Q3, Fluor secured new awards worth $3.3 billion, which may present a value opportunity for investors despite the cyclical nature of its business [6] Group 3: Investment Activity - DME Capital Management increased its holdings in Fluor by 44.3%, acquiring an additional 1,694,100 shares during Q3, raising its total position to 5,513,680 shares, valued at approximately $36.13 million [4]

Core Viewpoint - Fluor's business is improving, particularly through the monetization of its investment in NuScale Power, but the stock price may already reflect these developments [1]. Group 1: Business Performance - Fluor's stock has experienced significant volatility in 2025, with a peak decline of 37% followed by a year-to-date gain of 15%, but it has recently fallen again, resulting in an overall year-to-date loss of approximately 17% [1]. - The company raised about $600 million from a partial sale of its stake in NuScale Power in October 2025, capitalizing on the stock's high trading price at that time [6]. - Fluor's backlog at the end of Q3 2025 was $28.2 billion, with 82% of that work utilizing reimbursable contracts, indicating a shift towards more stable revenue sources [9]. Group 2: Investment in NuScale Power - Fluor was an early investor in NuScale Power, which focuses on small-scale modular nuclear reactors, a technology that has attracted investor interest [3]. - Despite NuScale Power's stock price having increased by nearly 200% at one point, it has since declined by about 10% for the year, reflecting the risks associated with the company's lack of operational products [5]. - The cash raised from the NuScale investment is expected to be reinvested in the business rather than distributed to shareholders, which may lead to disappointment for those expecting immediate returns [7]. Group 3: Company Overhaul and Market Position - Fluor is undergoing a significant overhaul to address past financial issues related to fixed-cost projects, moving towards a model where it is reimbursed for costs, which should enhance profitability [8]. - The company's current and historical price-to-earnings (P/E) ratios are not reliable for valuation due to recent losses, while the price-to-sales (P/S) ratio is above its five-year average, suggesting potential overvaluation [12]. - Major construction projects are cyclical, making it challenging to assign a clear valuation to Fluor despite improvements in its business fundamentals [11].

Core Insights - Aristides Capital has initiated a new position in Fluor Corporation, acquiring 224,842 shares valued at approximately $9.46 million as of September 30, representing about 2.84% of its total reportable U.S. equity assets [1][2]. Company Overview - Fluor Corporation is a global leader in engineering and construction services, focusing on energy, infrastructure, technology, and government projects [6]. - The company operates a project-driven business model, generating revenue through large-scale contracts in various sectors including energy transition, infrastructure, and government services [9]. Financial Performance - Fluor's revenue for the trailing twelve months (TTM) is reported at $15.59 billion, with a net income of $3.38 billion [4]. - The company's stock price as of the latest report is $40.69, reflecting a 20% decline over the past year, underperforming the S&P 500, which has increased by about 15% during the same period [3][4]. Recent Developments - Despite a challenging third quarter, where revenue fell 18% year over year, adjusted EBITDA increased by 29% to $161 million, and management has raised full-year adjusted EPS and EBITDA guidance [10]. - Fluor's backlog stands at $28.2 billion, with 82% being reimbursable, which mitigates risks associated with cost overruns [10][11]. - The company has repurchased $70 million of its stock in the quarter and plans to repurchase up to $800 million more by early 2026, supported by $2.8 billion in cash and marketable securities [11].

Core Viewpoint - Fluor Corporation is divesting its stake in the Zhuhai fabrication yard in China to Offshore Oil Engineering Co., Ltd. for approximately $122 million, aligning with its asset-light strategy and enhancing liquidity [1][7]. Group 1: Divestiture Details - The divestiture of the Zhuhai yard is expected to generate about $122 million (¥859 million) in proceeds, which will be used to strengthen liquidity and support capital allocation priorities [1][4]. - Following the transaction, COOEC will own 100% of the Zhuhai yard, allowing Fluor to maintain access for future projects without the burden of ownership costs [5][7]. Group 2: Strategic Implications - This move is part of Fluor's disciplined capital allocation strategy, aimed at reducing capital tied up in asset-heavy operations and lowering execution risk [2][3]. - The proceeds from the divestiture will be redeployed toward higher-return opportunities, including investments in areas like NuScale and other segments such as Urban Solutions, Energy Solutions, and Mission Solutions [3][4]. Group 3: Financial Performance and Market Context - Fluor's stock has declined 7% over the past three months, compared to a 5.3% decline in the Zacks Engineering - R and D Services industry, indicating ongoing market challenges [6]. - The company is facing project delays, particularly in the Energy Solutions segment, along with market headwinds such as tariffs, inflation, and foreign exchange risks, which are impacting growth prospects [6].

Core Viewpoint - Fluor Corporation has announced its decision to divest its Zhuhai Fabrication Yard located in China, indicating a strategic shift in its operational focus [1] Company Summary - The divestment of the Zhuhai Fabrication Yard is part of Fluor's broader strategy to streamline operations and focus on core business areas [1] - This move may reflect Fluor's response to changing market conditions and its commitment to optimizing its asset portfolio [1] Industry Summary - The decision to divest assets in China highlights the ongoing trends in the construction and engineering industry, where companies are reassessing their international operations [1] - The divestment could impact the competitive landscape in the region, as it may open opportunities for other firms to enter or expand in the Chinese market [1]

Core Insights - Hotchkis & Wiley Mid-Cap Value Fund's third-quarter 2025 investor letter highlights strong equity market performance, with major indices reaching all-time highs, driven by enthusiasm for AI, anticipated Federal Reserve rate cuts, and robust corporate earnings [1] - The fund outperformed the Russell Midcap Value Index, achieving a gain of 7.74% compared to the index's 6.18% [1] Company Overview: Fluor Corporation (NYSE:FLR) - Fluor Corporation is an engineering, procurement, and construction (EPC) company, primarily generating revenue from full EPC services [3] - The stock experienced a one-month return of -5.10% and a 52-week decline of 22.26%, closing at $43.40 per share with a market capitalization of $7.016 billion as of December 09, 2025 [2] Performance Analysis - Fluor's stock underperformed in the third quarter due to a weak earnings report and reduced forward guidance [3] - Despite the underperformance, Fluor is considered a high-quality professional services company with a medium-risk business model, expected to grow without reinvested capital [3] Investment Sentiment - Fluor Corporation is not among the top 30 most popular stocks among hedge funds, with 64 hedge fund portfolios holding its stock at the end of the third quarter, up from 57 in the previous quarter [4] - While acknowledging Fluor's potential, the company believes certain AI stocks present greater upside potential and lower downside risk [4]

Core Insights - Fluor Corporation, in partnership with JGC Corporation, has successfully completed Train 2 of the LNG Canada Project, marking the completion of the first phase of Canada's first LNG mega-project in Kitimat, British Columbia [1][2] Group 1: Project Completion and Significance - The handover of Train 2 demonstrates the commitment to safety, quality, and schedule performance by the workforce involved in the project [2] - The LNG Canada facility is designed to export Canadian natural gas to global markets, emphasizing environmental performance, Indigenous engagement, and economic development in British Columbia [2][3] Group 2: Economic Impact - Over $3.3 billion CAD has been spent on goods and services contracted with Indigenous businesses and joint ventures, along with more than $550 million CAD with local area businesses [2] - The facility has an annual production capacity of up to 14 million tonnes of LNG, benefiting from access to abundant natural gas and an ice-free harbor [3] Group 3: Joint Venture Structure - LNG Canada is a joint venture involving multiple stakeholders: Shell (40%), PETRONAS (25%), PetroChina (15%), Mitsubishi Corporation (15%), and Korea Gas Corporation (5%) [4] Group 4: Company Background - Fluor Corporation has over 75 years of experience in Canada, providing engineering, procurement, fabrication, and construction services for major projects in various sectors [5] - Fluor reported revenue of $16.3 billion in 2024 and is ranked 257 among Fortune 500 companies [6]

Core Perspective - The article discusses the investment potential of Fluor Corporation, particularly in the context of the nuclear power industry and small modular reactors (SMRs) [1][5]. Company Overview - Fluor Corporation is an engineering and construction company specializing in building full-scale nuclear plants that generate 1 gigawatt and above [6]. - Fluor holds a 38.9% stake in NuScale Power, a prominent SMR company, which is valued at approximately $2.3 billion based on NuScale's market capitalization of $6 billion [7]. Financial Analysis - Fluor's market capitalization is approximately $6.6 billion, with its NuScale stake and cash backing up 62% of this value, leading to an effective enterprise value of about $2.5 billion [8]. - The company reported earnings of $3.4 billion over the last 12 months, resulting in an enterprise-value-to-earnings ratio of less than 1 [9]. - Analysts project Fluor will earn around $360 million in real profit next year, with a growth rate of about 36% over the next three years, translating to a 12% annual growth rate [10][11]. Market Context - The nuclear power sector has seen a rise in stock prices for major SMR companies, but there are concerns regarding their profitability, with none expected to turn a profit before 2030 [4]. - Fluor's profitability contrasts with the SMR companies, as it is already generating revenue, making it a potentially safer investment in the nuclear sector [5][4]. Industry Developments - The U.S. Department of Energy announced Japan's commitment to invest $550 billion in the U.S., including $80 billion for the construction of 10 large nuclear power plants, which aligns with Fluor's business model [14]. - This development may positively impact Fluor's stock, despite the decline in value of its NuScale stake [15].