Imperial Capital Reiterates Outperform on Great Lakes Dredge & Dock (GLDD) Following a 4Q Review

Imperial Capital maintained an Outperform rating on Great Lakes Dredge & Dock (NASDAQ: GLDD), and cut the price target to $5.50 (from $6.50), following a review of the company's 4Q. GLDD reported adjusted EBITDA of $22.2mn, missing the Street's $25.8mn estimate. Revenue was $222.6mn, up -8.6% yoy. Management did not provide FY16 guidance.

Analyst Scott Levine commented, "On its 4Q15 earnings conference call on 2/23/16, GLDD did not provide FY16 guidance, which was not surprising, as the company withdrew guidance last quarter, due to a series of project challenges in its Environmental & Remediation (E&R) segment, which continued to weigh on its earnings in 4Q15. However, the dredging operations continue to perform well (backlog is up 14% year-over-year [yoy], and gross margins reached a recent high of 19.3%), and management hopes to reach breakeven in EBITDA in E&R in FY16, driven by more disciplined and efficient contract execution. We are lowering our FY15-16 EBITDA estimates to $83mn and $105mn, respectively, primarily to reflect higher SG&A, though we note that a recovery in E&R consistent with GLDD’s expectations (however, given recent results, we are somewhat skeptical) could yield meaningful upside to our estimates."

For an analyst ratings summary and ratings history on Great Lakes Dredge & Dock click here. For more ratings news on Great Lakes Dredge & Dock click here.

Shares of Great Lakes Dredge & Dock closed at $3.50 yesterday.

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