KBR (NYSE: KBR) and Fluor Corporation (NYSE:FLR) are both mid-cap construction companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, valuation, profitability and institutional ownership.

Analyst Ratings

This is a summary of recent ratings and target prices for KBR and Fluor Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
KBR 0 1 6 0 2.86
Fluor Corporation 0 9 4 0 2.31

KBR currently has a consensus target price of $19.80, indicating a potential upside of 12.18%. Fluor Corporation has a consensus target price of $48.17, indicating a potential upside of 13.04%. Given Fluor Corporation’s higher possible upside, analysts plainly believe Fluor Corporation is more favorable than KBR.

Risk & Volatility

KBR has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500. Comparatively, Fluor Corporation has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500.

Dividends

KBR pays an annual dividend of $0.32 per share and has a dividend yield of 1.8%. Fluor Corporation pays an annual dividend of $0.84 per share and has a dividend yield of 2.0%. KBR pays out -128.0% of its earnings in the form of a dividend. Fluor Corporation pays out 106.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares KBR and Fluor Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
KBR -0.81% 8.74% 1.89%
Fluor Corporation 0.58% 13.80% 4.92%

Institutional & Insider Ownership

99.7% of KBR shares are held by institutional investors. Comparatively, 84.5% of Fluor Corporation shares are held by institutional investors. 0.6% of KBR shares are held by insiders. Comparatively, 1.3% of Fluor Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares KBR and Fluor Corporation’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
KBR $4.46 billion 0.55 $9.00 million ($0.25) -70.60
Fluor Corporation $19.31 billion 0.31 $562.31 million $0.79 53.94

Fluor Corporation has higher revenue and earnings than KBR. KBR is trading at a lower price-to-earnings ratio than Fluor Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Fluor Corporation beats KBR on 10 of the 15 factors compared between the two stocks.

About KBR

KBR, Inc. is a provider of professional services and technologies across the asset and program life-cycle within the government services and hydrocarbons industries. The Company operates through business segments, including Technology & Consulting (T&C), Engineering & Construction (E&C), Government Services (GS), Non-strategic Business and Other. The T&C business segment combines KBR technologies, knowledge-based services and its three specialty consulting brands, Granherne, Energo and GVA, under a single customer-facing global business. The E&C business segment provides project and program delivery solution across the globe. The GS business segment provides life-cycle support solutions to defense, space, aviation and other programs and missions for government agencies in the United States, the United Kingdom and Australia. Its solutions include engineering services, mission and logistics support solutions, consulting, procurement, construction management and other support services.

About Fluor Corporation

Fluor Corporation (Fluor) is a holding company. The Company operates its business in four segments: Energy, Chemicals & Mining; Industrial, Infrastructure & Power; Government, and Maintenance, Modification & Asset Integrity (MMAI). The Company, through its subsidiaries, offers professional services providing engineering, procurement, construction, fabrication and modularization, commissioning and maintenance, as well as project management services on a global basis. The Company is an integrated solutions provider for various industries, including oil and gas, chemicals and petrochemicals, mining and metals, transportation, power, life sciences and advanced manufacturing. It is also a service provider to the United States federal Government and governments abroad. It offers services in various categories, including engineering and design, procurement, construction, fabrication, maintenance, modification and asset integrity and project management.

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