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Investing.com - BofA Securities downgraded KBR, Inc. (NYSE:KBR) from Buy to Neutral and lowered its price target to $55.00 from $70.00 on Wednesday. The stock, currently trading at $49.79, has seen a challenging year with a -22.42% return over the past 12 months.
The downgrade follows the Department of Defense’s cancellation of the $20 billion HomeSafe contract, which had been expected to drive medium-term growth for KBR.
BofA Securities cited additional program cancellations and a lack of near-term catalysts that would likely cause market hesitation about KBR’s prospects.
The firm also pointed to changing global energy priorities and delayed liquefied natural gas (LNG) decisions in the United States as factors pressuring the valuation of KBR’s Sustainable Technology Solutions portfolio.
BofA Securities expects KBR shares to remain range-bound until the company can "regain its credibility in Mission Technologies Solutions and meaningful STS awards kickoff."
In other recent news, KBR reported its second-quarter earnings for 2025, revealing an earnings per share (EPS) of $0.91, slightly exceeding analyst expectations of $0.90. However, the company’s revenue came in at $1.95 billion, which fell short of the anticipated $2.09 billion. In addition to its earnings report, KBR announced a significant contract win for the front-end engineering design (FEED) of the Abadi LNG project in Indonesia, a venture deemed of national strategic importance by the Indonesian government. This project aims to achieve a peak production capacity of 9.5 million tons per annum of LNG and 150 million standard cubic feet per day of pipeline gas.
Furthermore, KBR, in collaboration with Axiom Space, successfully completed underwater tests of the Axiom Extravehicular Mobility Unit (AxEMU) spacesuit at NASA’s Neutral Buoyancy Laboratory. These tests are part of the development for NASA’s Artemis III mission to the Moon, ensuring the suit’s integrity in simulated space conditions. In corporate governance developments, KBR announced the appointment of Huibert H. Vigeveno to its board of directors, effective August 5, 2025. Vigeveno brings extensive experience from his previous role at Shell, where he served on the executive committee. These recent developments reflect a period of strategic growth and innovation for KBR.
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