Near-term bookings remain lumpy at McDermott, as the current uncertain environment has adversely affected the economics of building new oil and gas infrastructure. Additionally, the transfer of the power generation and government operations has left McDermott with a less diversified business, thereby heightening its risk profile.
These factors are reflected in our downgrade of the company's shares to Underperform from Neutral. Our $12 price objective reflects 2010 P/E multiple of 10.4x.
MCDERMOTT INTL (MDR): Free Stock Analysis Report
Zacks Investment Research
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