ABB Wins Contract - Analyst Blog

ABB Ltd. (ABB) recently won a $24 million order for over 700 dry-type transformers from Ministry of Electricity and Water in Kuwait. The transformers will be used to facilitate the country's power and water utility.

The order is for dry-type transformers rated at 1000 kilovolts ampere (kVA), 1250 kVA and 1600 kVA. The company will also be providing spare parts required. The dry-type transformers from ABB Ltd., designed to withstand difficult environmental conditions, are suitable for Kuwait's hot summer climate.

The transformers are expected to be completely delivered and installed in 2011. The transformers will increase the capacity of the existing power system, while increasing the performance efficiency and dependability of the grid.

ABB Ltd.'s power and automation technologies offer a solution for sustainable development, thus helping to shield the world's resources. The company has a number of technologies for the solar power industry and also a growing installed base. ABB Ltd.has witnessed improving signs in late-cycle power, with some recent large contracts.

However, ABB Ltd.'s results are likely to be adversely affected by macroeconomic weakness as more than 80% of the company's orders are derived from outside the US. A major competitor of ABB Ltd. is Siemens AG (SI).

Based in Zurich, Switzerland, ABB Ltd. is a power and automation technology company. The company operates in five segments: Power Products and Power Systems supply products and complete Transmission and Distribution (T&D) solutions to utility and industrial customers.

Discrete Automation & Motion, Low-Voltage Products and Process Automation supply products, systems and solutions to customers across nearly all segments of the process and manufacturing industries, as well as specialist end markets, such as marine and utility. ABB Ltd. operates in approximately 100 countries and structured its global organization into five regions, Europe, Americas, Asia, the Middle East, and Africa. 

For the short term, the company has a Zacks #3 Rank (Hold).