Weekly Research Analysts’ Ratings Changes for McDermott International (MDR)

A number of research firms have changed their ratings and price targets for McDermott International (NYSE: MDR):

  • 2/3/2018 – McDermott International was downgraded by analysts at ValuEngine from a “buy” rating to a “hold” rating.
  • 1/25/2018 – McDermott International was downgraded by analysts at Zacks Investment Research from a “hold” rating to a “sell” rating. According to Zacks, “Concerned about the high debt load which McDermott will end up assuming post its merger with Chicago Bridge &Iron, we are downgrading our investment thesis of MDR from 'Hold' to 'Sell'. Chicago Bridge carries high massive debt due to imprudent acquisition decisions in the past. Though MDR in itself displays strong financials, post merger the new entity will carry a debt load of around $2 billion which could mar its credit metrics. Further, MDR is also witnessing lumpiness in its backlog position which has dipped around 38.4% year-over-year. Lack of new deepwater drilling orders is starting to haunt the subsea part of the industry. As such, with a considerable portion of MDR’s current backlog associated with offshore operations, it remains susceptible to the pricing weakness. Thus we view McDermott as a risky bet which should be avoided for the time being.”
  • 1/25/2018 – McDermott International had its price target raised by analysts at Citigroup Inc from $8.00 to $10.00. They now have a “neutral” rating on the stock.
  • 1/23/2018 – McDermott International was upgraded by analysts at KeyCorp from a “sector weight” rating to an “overweight” rating.
  • 1/15/2018 – McDermott International was upgraded by analysts at Zacks Investment Research from a “sell” rating to a “hold” rating. According to Zacks, “We appreciate McDermott’s broad product portfolio, diversified geographical footprint, good market position and strong relationship with national oil companies. MDR's $6 billion merger deal with Chicago Bridge & Iron bode well as it will lead to a fully integrated onshore-offshore company. The increased scale and diversification will also boost its growth prospects and lead to cost efficiencies. However, even though the merger adds onshore services to the company, a considerable portion of MDR’s current backlog is still associated with offshore operations, and thus remains susceptible to the pricing weakness. Further, with the merger, MDR will also end up assuming the high debt load of Chicago Bridge and Iron. Therefore, even though MDR in itself displays strong financials, the post merger entity will carry a debt load of around $2 billion which could mar its credit metrics. Thus we take a cautious stance on the stock.”
  • 1/8/2018 – McDermott International was downgraded by analysts at Zacks Investment Research from a “hold” rating to a “sell” rating. According to Zacks, “Concerned about the high debt load which McDermott will end up assuming post its merger with Chicago Bridge &Iron, we are downgrading our investment thesis of MDR from 'Hold' to 'Sell'. Chicago Bridge carries high massive debt due to imprudent acquisition decisions in the past. Though MDR in itself displays strong financials, post merger the new entity will carry a debt load of around $2 billion which could mar its credit metrics. Further, MDR is also witnessing lumpiness in its backlog position which has dipped around 38.4% year-over-year. Lack of new deepwater drilling orders are starting to haunt the subsea part of the industry. As such, with a considerable portion of MDR’s current backlog associated with offshore operations, it remains susceptible to the pricing weakness. Thus we view McDermott as a risky bet which should be avoided for the time being.”
  • 12/20/2017 – McDermott International had its “sell” rating reaffirmed by analysts at Morgan Stanley.

Shares of McDermott International Inc (MDR) opened at $7.65 on Friday. McDermott International Inc has a fifty-two week low of $5.56 and a fifty-two week high of $9.07. The stock has a market capitalization of $2,170.00, a PE ratio of 14.43 and a beta of 1.58. The company has a quick ratio of 1.70, a current ratio of 1.70 and a debt-to-equity ratio of 0.30.

McDermott International, Inc is a provider of integrated engineering, procurement, construction and installation (EPCI), front-end engineering and design (FEED) and module fabrication services for upstream field developments across the world. The Company delivers fixed and floating production facilities, pipeline installations and subsea systems from concept to commissioning for offshore and subsea oil and gas projects.

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