Tag: Industrial

Orion Group Holdings (ORN) – Momentum Building – First Look 4Q23 Results

Posted on by cpereira@noblefcm.com


Thursday, February 29, 2024

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

4Q Results. Contract revenues were $201.6 million, up 2.8% y-o-y. We estimated revenue at $190 million. Adjusted net income for the quarter was at $2.6 million, or $0.08 per share, compared to an adjusted net loss of $3.7 million, or a loss of $0.12 per share, last year. Adjusted EBITDA was at $14.8 million from $3.2 million the prior year. We had estimated adjusted net income of $1.27 million, or $0.04 per share, and adjusted EBITDA of $11.6 million.

Margin Improvement. Gross margin improved to 11.4% in 4Q23, up from 5.2% in 4Q22. Adjusted EBITDA margin increased to 7.3% from 1.6% y-o-y. We believe management’s strategic plan to deliver profitable growth to be the key difference. Higher quality projects and improved execution are sustainable, in our view.


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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Euroseas (ESEA) – Euroseas signs new vessel charter, we initiate 2025 estimates

Posted on by cpereira@noblefcm.com


Thursday, February 29, 2024

Euroseas Ltd. was formed on May 5, 2005 under the laws of the Republic of the Marshall Islands to consolidate the ship owning interests of the Pittas family of Athens, Greece, which has been in the shipping business over the past 140 years. Euroseas trades on the NASDAQ Capital Market under the ticker ESEA. Euroseas operates in the container shipping market. Euroseas’ operations are managed by Eurobulk Ltd., an ISO 9001:2008 and ISO 14001:2004 certified affiliated ship management company, which is responsible for the day-to-day commercial and technical management and operations of the vessels. Euroseas employs its vessels on spot and period charters and through pool arrangements.

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Euroseas signed a two-year charter contract for the M/V Leonidas Z at a rate of $20,000/day. The rate will commence upon delivery which is expected at the end of April or beginning of May. The rate is above the rate we had assumed in our model although the increased impact on revenues and earnings is minimal given the size of the Euroseas’ fleet.

We are initiating 2025 quarterly and annual estimate. Revenues and earnings will be challenged by the roll off of several attractive charters and rising interest expenses. However, results will be boosted by the addition of six ships in 2024 including four in the 2024-2Q and two in 2024-4Q. We believe the net result will mean 2025 revenues will be similar to 2024 and earnings will be modestly below 2024. 


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This Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

DLH Holdings (DLHC) – A CMOP Update

Posted on by cpereira@noblefcm.com


Thursday, February 29, 2024

DLH delivers improved health and readiness solutions for federal programs through research, development, and innovative care processes. The Company’s experts in public health, performance evaluation, and health operations solve the complex problems faced by civilian and military customers alike, leveraging digital transformation, artificial intelligence, advanced analytics, cloud-based applications, telehealth systems, and more. With over 2,300 employees dedicated to the idea that “Your Mission is Our Passion,” DLH brings a unique combination of government sector experience, proven methodology, and unwavering commitment to public health to improve the lives of millions. For more information, visit www.DLHcorp.com.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

8-K Filing. In an 8-K filing, DLH disclosed the potential loss of one of its VA Consolidated Mail Outpatient Pharmacy (“CMOP”) locations, which accounted for less than 3% of fiscal 2023 consolidated revenue, or about $11 million. According to the filing, on February 22, 2024, DLH was advised that the VA had made an award decision for the Chelmsford CMOP Staffing Services location to a service-disabled veteran owned small business (SDVOSB) unrelated to DLH. Should the VA complete its acquisition process with a final award to an unrelated entity, DLH would no longer perform services at this CMOP location.

Background. To refresh investor memories, DLH was first awarded the CMOP contracts for healthcare logistics and pharmacy services in 2011. At the time, there were nine pharmacy services contracts and seven logistics contracts for the seven geographic locations. The VA has since combined the logistics and pharmacy services in each area, resulting in eight current contracts on which to bid.


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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Kratos Defense & Security (KTOS) – A Capital Raise

Posted on by cpereira@noblefcm.com


Tuesday, February 27, 2024

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) develops and fields transformative, affordable technology, platforms, and systems for United States National Security related customers, allies, and commercial enterprises. Kratos is changing the way breakthrough technologies for these industries are rapidly brought to market through proven commercial and venture capital backed approaches, including proactive research, and streamlined development processes. At Kratos, affordability is a technology, and we specialize in unmanned systems, satellite communications, cyber security/warfare, microwave electronics, missile defense, hypersonic systems, training and combat systems and next generation turbo jet and turbo fan engine development. For more information go to www.kratosdefense.com.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

A Capital Raise. After the market close on Thursday, Kratos announced the pricing of an underwritten offering of 16,666,667 shares of its common stock at a public offering price of $18.00 per share. The net proceeds to Kratos from the offering, after deducting underwriting discounts and commissions, are expected to be approximately $288 million. Kratos also granted the underwriters a 30-day option to purchase up to an additional 2,500,000 shares of common stock. All of the shares in the offering are to be sold by Kratos. The offering is expected to close on February 27, 2024, subject to customary closing conditions. We would note Noble Capital was part of the underwriting group.

Uses. Kratos expects to use the net proceeds to facilitate its long-term strategy, including potential investment in facilities, expanding manufacturing capacity, and anticipated capital expenditures for expansion of current sole-source/single award programs and high probability pipeline opportunities. Other uses are to further strengthen the Company’s balance sheet in anticipation of upcoming customer and partner decisions and source selection on additional large, new program and contract opportunities and for general corporate purposes, including paydown of debt.


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This Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Euroseas (ESEA) – December-quarter Results

Posted on by cpereira@noblefcm.com


Thursday, February 22, 2024

Euroseas Ltd. was formed on May 5, 2005 under the laws of the Republic of the Marshall Islands to consolidate the ship owning interests of the Pittas family of Athens, Greece, which has been in the shipping business over the past 140 years. Euroseas trades on the NASDAQ Capital Market under the ticker ESEA. Euroseas operates in the container shipping market. Euroseas’ operations are managed by Eurobulk Ltd., an ISO 9001:2008 and ISO 14001:2004 certified affiliated ship management company, which is responsible for the day-to-day commercial and technical management and operations of the vessels. Euroseas employs its vessels on spot and period charters and through pool arrangements.

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Euroseas reported a 14% year-over-year increase in revenues, net during the quarter ended December 31, 2023 due mainly to the addition of a vessel and increased fleet utilization rates. Shipping rates were largely unchanged from last year and generally predictable given a high charter coverage.

Costs were generally in line with expectations. Drydocking expenses were higher than expected due to the retrofitting of the MV Synergy Busan. Interest and financing costs continue to rise with a $23 million year-over-year increase in debt as the company makes payments on six newbuilds. In total, the company is spending $220 million on the newbuilds with $65 million already paid and an additional $130 million to be financed. Bottom-line results were near expectations.


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This Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Seanergy Maritime (SHIP) – December-quarter preview

Posted on by cpereira@noblefcm.com


Wednesday, February 21, 2024

Seanergy Maritime Holdings Corp. is the only pure-play Capesize ship-owner publicly listed in the US. Seanergy provides marine dry bulk transportation services through a modern fleet of Capesize vessels. The Company’s operating fleet consists of 17 Capesize vessels with an average age of approximately 12 years and aggregate cargo carrying capacity of approximately 3,011,083 dwt. The Company is incorporated in the Marshall Islands and has executive offices in Glyfada, Greece. The Company’s common shares trade on the Nasdaq Capital Market under the symbol “SHIP” and its Class B warrants under “SHIPZ”.

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Shipping rates improved at the end of the quarter. At the end of the third quarter, management indicated that it had locked in 60% of estimated operating days at $21,640/day and that at current spot prices, the average TCE rate for the quarter would be $19,480/day. With spot prices rising, the average TCE rate will most likely be closer to $23,000/day. The addition of a new vessel and limited drydocking will mean increased operating days. Raising the TCE rate in our models increase revenues by approximately $4 million.

Shipping rates have fallen in the 2024-1Q due to seasonal factors such as the Chinese New Year and the rain season in Brazil but remain above historical 1Q levels. We have lowered our revenue projection to reflect lower rates and decreased fees from related parties (Seanergy receives revenues for third party ship management which included abnormal gains in 2023-3Q). 


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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Orion Group Holdings (ORN) – A Contract for East West Jones?

Posted on by cpereira@noblefcm.com


Wednesday, February 21, 2024

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

A New Contract. Yesterday, after the market close, Orion filed an 8-K disclosing the entry into a sales contract for its 340 acre East West Jones land parcels previously used by the Company as dredge placement areas. The purchase price is approximately $34 million and closing is anticipated on or before June 14, 2024.

A Modest Reduction. This is not the first time Orion has entered into a transaction for the property. Back in April 2023, Orion entered into a contract to sell the parcels for approximately $36 million. While the $2 million reduction in the sales price is not optimal, we view the monetization of another non-core asset to be a positive.


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Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Kratos Defense & Security (KTOS) – A Multitude of Opportunity

Posted on by cpereira@noblefcm.com


Tuesday, February 20, 2024

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) develops and fields transformative, affordable technology, platforms, and systems for United States National Security related customers, allies, and commercial enterprises. Kratos is changing the way breakthrough technologies for these industries are rapidly brought to market through proven commercial and venture capital backed approaches, including proactive research, and streamlined development processes. At Kratos, affordability is a technology, and we specialize in unmanned systems, satellite communications, cyber security/warfare, microwave electronics, missile defense, hypersonic systems, training and combat systems and next generation turbo jet and turbo fan engine development. For more information go to www.kratosdefense.com.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Review. We reviewed the Company’s 10-K filing as well as went through the conference call transcript again. Both highlight the tremendous amount of opportunity available to the Company. Opportunity that we believe will begin to be realized this year and lead to improved operating performance.

A Key Change. While Kratos always has been open to partnering with prime contractors, the 10-K highlights, in our view, a mindset change in such partnerships. Kratos now will be more willing to enter such partnerships in all areas of the Company’s business when management’s assessment of the opportunities indicates such a partnership is the most favorable opportunity.


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This Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Kelly Services (KELYA) – Transformation Continued in the Fourth Quarter; Raising PT to $27

Posted on by cpereira@noblefcm.com


Tuesday, February 20, 2024

Kelly (Nasdaq: KELYA, KELYB) connects talented people to companies in need of their skills in areas including Science, Engineering, Education, Office, Contact Center, Light Industrial, and more. We’re always thinking about what’s next in the evolving world of work, and we help people ditch the script on old ways of thinking and embrace the value of all workstyles in the workplace. We directly employ nearly 350,000 people around the world and connect thousands more with work through our global network of talent suppliers and partners in our outsourcing and consulting practice. Revenue in 2021 was $4.9 billion. Visit kellyservices.com and let us help with what’s next for you.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

4Q23 Results. Kelly reported revenue of $1,232.2 million, essentially flat y-o-y and down just 1.3% on a constant currency basis. We had estimated $1,220 million. Adjusted net income was $34.1 million or EPS of $0.93, compared to $7 million, or $0.18/sh last year. We had estimated EPS of $0.56. Adjusted EBITDA was $32.5 million, or a 2.6% margin, up from $24.1 million and 2%, respectively, last year. We had forecast $33.8 million.

International Sale. As previously announced, Kelly completed the sale of its International staffing business in early January. This business generated some $810 million of revenue and $120 million of gross profit in 2023.


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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

EuroDry (EDRY) – Strong results on the heels of fleet expansion and shipping rate improvement

Posted on by cpereira@noblefcm.com


Tuesday, February 20, 2024

EuroDry Ltd. was formed on January 8, 2018 under the laws of the Republic of the Marshall Islands to consolidate the drybulk fleet of Euroseas Ltd. into a separate listed public company. EuroDry was spun-off from Euroseas Ltd. on May 30, 2018; it trades on the NASDAQ Capital Market under the ticker EDRY. EuroDry operates in the dry cargo, drybulk shipping market. EuroDry’s operations are managed by Eurobulk Ltd., an ISO 9001:2008 and ISO 14001:2004 certified affiliated ship management company and Eurobulk (Far East) Ltd. Inc., which are responsible for the day- to-day commercial and technical management and operations of the vessels. EuroDry employs its vessels on spot and period charters and under pool agreements.

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Revenues improve with the addition of vessels and higher shipping rates. EuroDry took possession of three ships during the quarter and put them into service, resulting in additional operating days. The average shipping rate of $14.570 rose 20% quarter over quarter. EuroDry continues to be the most sensitive to rate changes of all the shipping companies we follow. 

Expenses went up with more ships, but costs per operating day were flat. Vessel operating and depreciation costs rose with an increase in voyage days. Vessel operating costs per voyage day were $5,421 in the most recent quarter versus $5,343 in the previous quarter and $5,366 in the same period last year. Financing costs rose with the issuance of $32.5 million to finance the acquisition of vessels. 


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This Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

The GEO Group (GEO) – Ending the 2023 Fiscal Year on a Good Note

Posted on by cpereira@noblefcm.com


Friday, February 16, 2024

The GEO Group, Inc. (NYSE: GEO) is a leading diversified government service provider, specializing in design, financing, development, and support services for secure facilities, processing centers, and community reentry centers in the United States, Australia, South Africa, and the United Kingdom. GEO’s diversified services include enhanced in-custody rehabilitation and post-release support through the award-winning GEO Continuum of Care®, secure transportation, electronic monitoring, community-based programs, and correctional health and mental health care. GEO’s worldwide operations include the ownership and/or delivery of support services for 103 facilities totaling approximately 83,000 beds, including idle facilities and projects under development, with a workforce of up to approximately 18,000 employees.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

4Q23 Results. Revenue for the quarter came in at $608.3 million, compared to $620.7 million a year ago. Adjusted EBITDA totaled $129 million, EPS was $0.21, and adjusted EPS $0.29. In the year ago period, GEO reported $145.5 million, $0.28, and $0.34, respectively. We had forecast $600 million, $119.5 million, $0.19, and $0.19, respectively.

Debt Reduction. For the full year, GEO reduced net debt by some $197 million, ending the year with approximately $1.8 billion of net debt. We expect the Company to continue to reduce net debt by $175-$200 million annually.


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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Great Lakes Dredge & Dock (GLDD) – A Solid Fourth Quarter; Backlog Continues to Rise

Posted on by cpereira@noblefcm.com


Friday, February 16, 2024

Great Lakes Dredge & Dock Corporation is the largest provider of dredging services in the United States. In addition, Great Lakes is fully engaged in expanding its core business into the rapidly developing offshore wind energy industry. The Company has a long history of performing significant international projects. The Company employs experienced civil, ocean and mechanical engineering staff in its estimating, production and project management functions. In its over 131-year history, the Company has never failed to complete a marine project. Great Lakes owns and operates the largest and most diverse fleet in the U.S. dredging industry, comprised of approximately 200 specialized vessels. Great Lakes has a disciplined training program for engineers that ensures experienced-based performance as they advance through Company operations. The Company’s Incident-and Injury-Free® (IIF®) safety management program is integrated into all aspects of the Company’s culture. The Company’s commitment to the IIF® culture promotes a work environment where employee safety is paramount.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

4Q23 Results. Fourth quarter revenue came in at $181.7 million, slightly below our $190 million estimate, due to a delay in some work which has since commenced, but above the $146.7 million in 4Q22. Reported gross margin jumped to 21.3% from a negative last year. Net income came in at $21.6 million, or $0.32/sh, from a loss of $31.2 million, or a loss of $0.47/sh in 4Q22, which was impacted by the write-down of the Terrapin Island. Adjusted EBITDA came in at $40.8 million, up from a $24.2 million loss last year.

Solid Operating Environment. The dredging bid environment remains strong, with proposed increased funding and a number of key capital projects coming to bid in 2024. While the wind and LNG segments are more challenged, we believe both markets will prove fruitful for Great Lakes in the long-term.


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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Kratos Defense & Security (KTOS) – A Better Than Expected Fourth Quarter

Posted on by cpereira@noblefcm.com


Wednesday, February 14, 2024

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) develops and fields transformative, affordable technology, platforms, and systems for United States National Security related customers, allies, and commercial enterprises. Kratos is changing the way breakthrough technologies for these industries are rapidly brought to market through proven commercial and venture capital backed approaches, including proactive research, and streamlined development processes. At Kratos, affordability is a technology, and we specialize in unmanned systems, satellite communications, cyber security/warfare, microwave electronics, missile defense, hypersonic systems, training and combat systems and next generation turbo jet and turbo fan engine development. For more information go to www.kratosdefense.com.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

4Q23 Results. Coming in above expectations, 4Q23 revenue totaled $273.8 million, up 9.8% y-o-y, with the improvement driven by 17% growth in the Government Solutions segment. Adjusted EBITDA came in at $29.1 million, up from $19.2 million a year ago. Adjusted EPS was $0.12 versus $0.08. We had forecasted revenue of $250 million, adjusted EBITDA of $22.5 million, and adjusted EPS of $0.08.

Opportunity, Opportunity, Opportunity. The Company continues to rack up awards. Yesterday, Kratos announced the award of the $579 million SATCOM C2 System ID/IQ. This was the Company’s only major re-compete. Notably, the size of the contract is 50% larger than the prior contract, adding another growth vehicle.


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Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.

This Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.