Great Lakes Dredge & Dock (GLDD) has seen a significant increase in its shares following the release of blowout quarterly results on May 7. The company reported a 25.7% year-over-year increase in Q1 contract revenues to $198.7 million, surpassing the consensus view by $28.3 million. This growth was driven by higher coastal protection and capital project activity, as well as improved utilization and project performance. GLDD also experienced a favorable shift in project mix to higher-margin projects, leading to a sharp increase in earnings per share from a loss of 5 cents to 31 cents, exceeding Wall Street’s projections.
Despite the strong performance in Q1, GLDD expects a sequential decrease in revenue and earnings in the current quarter due to some ship maintenance work being pushed into Q2. However, this maintenance-related activity was planned in advance and is a positive sign as it prepares the company for new projects, including a liquefied natural gas project set to begin later this year. Additionally, GLDD is currently working on two large projects in Texas, the Freeport port deepening and Sabine-Neches Waterway channel improvement projects, which are expected to contribute to future revenue growth.
GLDD is recommended as a stock to watch in the market-beating investment newsletter Forbes Investor, which identifies undervalued opportunities with significant upside potential. The company’s strong position in the capital and coastal protection markets, along with the anticipated growth in the bid market supported by the record 2024 U.S. Army Corps of Engineer’s budget, suggest that higher-margin capital work will continue to be a key driver of GLDD’s business in the coming quarters. The recent addition of a new dredge, Galveston Island, and plans for two new ships to join the fleet in 2025 further position the company for continued success.
Julius Juenemann, CFA, an equity analyst and associate editor at Forbes, highlights GLDD as a current recommendation in the Forbes Investor newsletter. To access this recommendation and others, readers can subscribe to the newsletter for more insights on potential investment opportunities. With the strong performance in Q1 and promising prospects for future projects, GLDD is expected to exceed current consensus views, potentially leading to further gains in the company’s shares. Investors are encouraged to follow developments in GLDD and explore opportunities for growth in the dredging and dock industry.
In conclusion, Great Lakes Dredge & Dock’s impressive Q1 results and positive outlook for future projects have contributed to a significant increase in its shares. The company’s focus on higher-margin capital work, along with planned maintenance activities and new project developments, position it for continued success in the dredging and dock industry. With recommendations from Forbes Investor and a strong track record of exceeding expectations, GLDD remains a stock to watch for potential investment opportunities and continued growth in the market.
