Boston, MA 03/03/2014 (wallstreetpr) – KBR, Inc. (NYSE:KBR) was a source of disturbing news just after it reported fiscal fourth quarter 2013. In a way, the stock ended up making the difference between a good stock and that which makes people rich. Reporting rough fourth quarter results is not something that investors anticipated or prepared for, but it nonetheless happened.
KBR, Inc. (NYSE:KBR) was just doing fine till it was time to present the three months performance score card. The company, a global construction and engineering player, put on a straight face to report that its revenue fell from $1.8 billion in the fourth quarter of 2012 to $1.7 in the fourth quarter of 2013 – that is, the latest quarter reported.
As if that was not bad news already, the company went on to say that net income was down by 10 percent year over year to just about $27 million or 18 cents per share.
That KBR, Inc. (NYSE:KBR) reported below per result is something that investors can easily come into terms with. But that is possible where the management keeps the hope alive. However, in the case of KBR, the management kind of added insult to injury by saying that it expected the company to realize earnings per share in the range of $1.75 to $2.10 next year, significantly below the $2.69 EPS that Wall Street estimates. Although the expected EPS is up from $1.54, it doesn’t make a good deal for the investors.
Justifying the results
There wasn’t much that the management could do to keep investor hope alive. However, it was possible, perhaps easier, to say that gas monetization business and delay in the closure of two LNG operations were responsible for the weak results just reported.
Investor Takeaway
KBR, Inc. (NYSE:KBR) has not always been bad news. But this time around it was. However, it is important to note that nothing is flawed in the business and that the downfall of the shares was always going to happen given that they have of late run ahead of themselves. So then, there is no cause for alarm in KBR.
