Group 1 - Investors are increasingly interested in nuclear energy stocks due to global commitments to triple nuclear energy capacity in the coming decades to meet energy demands and reduce carbon emissions [2][8] - NuScale Power is a key player in the nuclear energy sector, developing small modular reactors (SMRs) that offer scalable and lower-cost solutions compared to traditional reactors [4][8] - Fluor has been a long-term investor in NuScale and is collaborating on the development of SMR technology, specifically on a project in Romania called RoPower [5][6] Group 2 - Fluor is selling its stake in NuScale, which may exert downward pressure on NuScale's stock price, despite the stock having previously surged significantly since its public offering [7] - NuScale's stock price reached a high of $57 per share after going public at approximately $10 per share, with Fluor capitalizing on this increase by selling part of its stake for $605 million [7]

Group 1 - Fluor has achieved mechanical completion on BASF's new Verbund site project in South China, marking a significant milestone in the project timeline [1] - The completion of this project is expected to enhance BASF's production capabilities and operational efficiency in the region [1] - This development aligns with the growing demand for chemical products in Asia, particularly in China, which is a key market for BASF [1]

Core Viewpoint - Fluor is making strides to stabilize its cash flow and has a significant investment in NuScale Power, a nuclear power start-up, but the overall investment appeal remains cautious due to inherent business volatility [1][10]. Company Overview - Fluor is an engineering and construction company that builds large structures for businesses and governments, excelling in its field [2]. Business Model Changes - Fluor is shifting its business model from fixed-price contracts to reimbursable contracts, with 82% of its $28.2 billion backlog now consisting of the latter, aiming for more consistent financial results [5][4]. Market Volatility - The construction industry is cyclical, leading to potential project cancellations during economic downturns, which contributes to Fluor's income volatility despite recent improvements [6]. Investment in NuScale Power - Fluor's investment in NuScale Power, focused on small modular nuclear reactors, is seen as a strategic move to secure future contracts, with ongoing efforts to approve a power plant in Romania [8][9]. Financial Aspects of NuScale Investment - Fluor raised $605 million from selling part of its NuScale stake in October 2025, with plans to sell the remainder by mid-2026, although the value of this stake is uncertain due to NuScale's stock volatility [10][12]. Risk Profile - Fluor is considered suitable for risk-tolerant investors due to the unpredictable nature of the construction industry and the speculative nature of its investment in NuScale Power [14][15].

Core Viewpoint - Fluor Corporation will hold a conference call to discuss its fourth quarter results for the period ending December 31, 2025, inviting public participation [1] Group 1 - The conference call is scheduled for Tuesday, February 17, 2026, at 8:30 a.m. Eastern [1] - Chief Executive Officer Jim Breuer and Chief Financial Officer John Regan will be present during the call [1] - Financial results will be released prior to the market opening on the same day [1]

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].