KBR Inc. (KBR) — This company has risen to become one of the six major players in U.S. power generation construction and engineering with about 15%-20% of the market. Its focus is gas-generated power.
Earnings estimates are $2.65 for 2013, $3.15 for 2014, and $3.25 for 2015. A Credit Suisse analyst following the stock expects KBR to benefit from a shift to higher-margin gas-monetization business. And new air emissions regulations should add immeasurably to growth. The median consensus target price is $40.
In early May, KBR broke from an eight-month consolidation, jumping from $32 to over $36 in just two weeks. Profit-taking and general market weakness resulted in a pullback to just below its breakout point. But it reversed and closed at $32.56 on Thursday, above its 50-day moving average.
MACD is oversold, so traders should buy KBR at the market with a trading target of $38. Longer-term investors could find this stock to be a cornerstone investment in the development of new natural gas fields.