Fluor (FLR) Stock Forecast & Price Target

Fluor reported a revenue of $16.3 billion in 2024, showcasing strong sales growth across its core segments, particularly with Mission Solutions and Urban Solutions contributing significantly with sales increases of 20% and 21%, respectively. The company's improving operational cash flow guidance, now set between $250 million and $300 million, alongside a strengthened earnings stream driven by sectors with strong growth prospects, positions Fluor favorably for future profitability. Additionally, the increase in the book-to-burn ratio to 0.8x, coupled with a dramatically improved balance sheet, suggests that Fluor is on a trajectory towards returning to investment grade status while potentially achieving double-digit earnings growth in the medium term.

Fluor's financial performance indicates significant challenges, highlighted by a substantial operating loss of $533 million, exacerbated by a $653 million revenue reversal tied to a disputed Santos project. The company's total backlog declined by 10% year-over-year to $28.236 billion, with the Energy Solutions segment experiencing a stark 42% year-over-year decrease, further contributing to the negative outlook. Additionally, the pushback of medium-term adjusted EBITDA targets by four quarters and anticipated weakness in new awards growth until late 2026 suggest ongoing operational difficulties and a lack of momentum within the business segments.