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On Thursday, DA Davidson reiterated a Buy rating on Orion Marine Group (NYSE:ORN) with a steady price target of $11.00, well above the current trading price of $5.86. According to InvestingPro data, analysts maintain a Strong Buy consensus with price targets ranging from $10.00 to $12.00, despite the stock’s recent 15% decline over the past week. The firm’s analysis highlighted Orion’s low valuation levels, improving margins, a growth profile, and a stable capital position, presenting the stock as an attractive investment with strong booking prospects extending through 2025.
Orion Marine Group has issued revenue guidance for the year in the range of $800 million to $850 million, with adjusted earnings per share (EPS) expected to fall between $0.11 and $0.17. Adjusted EBITDA is forecasted to be between $42 million and $46 million, a slight increase from the $41.9 million in 2024. These projections take into account various financial factors such as depreciation & amortization, interest, and segment margins, leading DA Davidson to believe there is a high probability for upward revisions within the year.
Looking further ahead, the firm has updated its 2025 guidance while stating that 2026 does not show a material change. The cash flow for Orion Marine Group is anticipated to be sufficient to cover an expected increase in capital expenditures in 2025, which is in preparation for growth. This also indicates a stronger cash flow for the company in the upcoming year.
DA Davidson’s commentary also mentioned that Orion Marine Group is not currently drawing on its revolving credit facility, which suggests a stable balance sheet, supported by a healthy current ratio of 1.41 and moderate debt-to-equity ratio of 0.62. The firm’s positive outlook on the stock is based on several financial metrics and the strategic position of the company, which appears to be poised for future growth. InvestingPro subscribers can access 8 additional key insights about ORN’s financial health, growth prospects, and detailed valuation analysis in the comprehensive Pro Research Report.
In other recent news, Orion Group Holdings Inc. reported its fourth-quarter 2024 earnings, revealing a slight miss in both earnings per share (EPS) and revenue compared to market expectations. The company posted an EPS of $0.16, falling short of the forecasted $0.18, while revenue stood at $217 million, below the anticipated $265.2 million. Despite this quarterly shortfall, Orion demonstrated strong annual performance with a 12% increase in full-year revenue, reaching $796 million. Gross profit surged by 48% to $91 million, and adjusted EBITDA rose 76% to $41.9 million for the year, highlighting the company’s operational efficiency.
Looking ahead, Orion has set its 2025 revenue guidance between $800 million and $850 million, with adjusted EBITDA projected at $42 million to $46 million. The company is focusing on backlog growth to drive revenue in 2026 and anticipates continued strength in its marine and concrete segments. In related developments, the company executed an amendment to its credit agreement with White Oak, reducing loan pricing and extending the maturity date, reflecting lender confidence in Orion’s enhanced credit profile. Analyst discussions during the earnings call focused on the revenue shortfall, attributed to project timing rather than market softness, and the potential for margin improvement with upcoming Navy projects in the Pacific.
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