Engineering and construction firm KBR is the IBD Stock Of The Day. The Houston-based company delivers a variety of science, technology and engineering solutions to governments and companies worldwide. KBR stock is forming a base.
KBR, which was spun out of Halliburton, had focused on oil and gas markets until 2006. It now offers services like supply-chain management and heavy equipment transport to aerospace, defense and industrial businesses.
For example, on April 6, KBR said it had completed its private astronaut training for the upcoming Axiom Mission 1 to visit the International Space Station.
On March 24, KBR and ExxonMobil said they would collaborate to work on advancing the process to convert propane into propylene — the basic feedstock for many plastics and other products.
And on March 15, KBR updated its 2025 long-term financial targets to factor in expected benefits from the HomeSafe alliance joint venture.
The partnership, between KBR and Tier One Relocation, secured a contract in November 2021 to improve the Department of Defense's military and civilian personnel's domestic and international relocation services. KBR holds a 72% ownership stake in HomeSafe.
The contract, with a ceiling value of $20 billion, is expected to boost KBR earnings. KBR has lifted its 2025 guidance, expecting sales to reach $9.5 billion, up 19% from the earlier expectation of $8 billion. The company sees adjusted EPS of $4.75 in 2025.
KBR Stock
Shares dipped 0.4% to 53.93 on the stock market today. KBR stock is working on a possible flat base with a 56.17 buy point. It'll be a base-on-base pattern.
Shares are finding support around the 21-day exponential moving average, according to MarketSmith charts. Its relative strength line is near highs. KBR's RS Rating is 95 out a best-possible 99. Its EPS Rating is 92.
The company has posted five straight quarters of earnings growth, and three quarters in a row of sales growth.
The stock has a three-year EPS growth rate of 13% and a three-year sales growth rate of 9%.
With a Composite Rating of 97, KBR is the top-ranked stock in IBD's Building-Heavy Construction group.
KBR stock has a B Accumulation/Distribution Rating, which shows more buying than selling by institutional investors over the last 13 weeks.
Heavy construction stocks are doing well, buoyed by federal infrastructure spending, and as pressure grows on oil and gas companies to increase production amid soaring energy prices.
Among other firms in IBD's Building-Heavy Construction group, Quanta Services has run up almost 19% since late February. Shares of Fluor have soared 28% in the same period.
Follow Adelia Cellini Linecker on Twitter @IBD_Adelia.
