Fluor Corp (FLR) Stock Analysis and Metrics

Sector: Industrials Industry: Engineering & Construction CIK: 0001124198

Market Cap 7.81 Bn

P/E -153.61

P/S 0.50

Div. Yield -0.01

ROIC (Qtr) -0.08

Total Debt (Qtr) 1.07 Bn

Revenue Growth (1y) (Qtr) -1.97

Add ratio to table...

About

Fluor Corp operates as a leading engineering, procurement, construction, and maintenance (EPCM) company, specializing in delivering large-scale, complex projects across various industries. The company is renowned for its expertise in infrastructure, energy, and industrial sectors, providing comprehensive solutions that encompass project development, execution, and lifecycle management. Fluor Corp's services are critical in supporting the development of critical infrastructure, including power plants, oil and gas facilities, mining operations, and...

Fluor Corp operates as a leading engineering, procurement, construction, and maintenance (EPCM) company, specializing in delivering large-scale, complex projects across various industries. The company is renowned for its expertise in infrastructure, energy, and industrial sectors, providing comprehensive solutions that encompass project development, execution, and lifecycle management. Fluor Corp's services are critical in supporting the development of critical infrastructure, including power plants, oil and gas facilities, mining operations, and industrial complexes, making it a key player in the global EPCM market.

Fluor Corp generates revenue through a diverse portfolio of services, including engineering and design, procurement, construction, and maintenance. The company's primary offerings include integrated project management, construction services, and maintenance solutions, catering to a broad customer base that includes government agencies, private corporations, and international organizations. Fluor Corp's revenue streams are bolstered by its ability to manage large-scale, high-value projects, often involving complex logistics and technical challenges. The company's customer base spans multiple industries, including energy, mining, infrastructure, and government sectors, reflecting its versatility and broad market reach.

• Urban Solutions: This segment focuses on delivering infrastructure solutions for urban development, including transportation, water, and power projects. It caters to both public and private clients, providing comprehensive services from planning to execution. The segment leverages Fluor Corp's expertise in large-scale infrastructure projects to support urban growth and development.

• Energy Solutions: This segment specializes in the development and execution of energy projects, including power generation, oil and gas, and renewable energy initiatives. It offers a range of services, from engineering and construction to maintenance and operations, catering to energy companies and government entities. The segment plays a crucial role in supporting the global energy sector's transition towards sustainable and efficient energy solutions.

• Mission Solutions: This segment provides services related to government and defense projects, including facilities management, logistics, and technical support. It serves government agencies and defense contractors, offering specialized solutions that meet the unique requirements of the public sector. The segment's expertise in complex project management and technical support is essential in delivering mission-critical infrastructure and services.

Fluor Corp holds a prominent position within the EPCM industry, competing with other major players such as Bechtel, AECOM, and Jacobs. The company's competitive advantages include its extensive global presence, technical expertise, and proven track record in managing large-scale, complex projects. Fluor Corp's ability to integrate various services, from engineering to construction and maintenance, allows it to offer comprehensive solutions that meet the diverse needs of its clients. Additionally, the company's focus on innovation and sustainability further enhances its competitive position, enabling it to deliver projects that align with evolving industry standards and client requirements.

Fluor Corp's customer base includes a mix of government agencies, private corporations, and international organizations, reflecting its broad market reach and versatility. The company's services cater to clients in various industries, including energy, mining, infrastructure, and government sectors, demonstrating its ability to address the unique challenges and requirements of different markets. By leveraging its expertise and global presence, Fluor Corp continues to support the development of critical infrastructure and projects worldwide.

Investment thesis

Bull case

Fluor’s 2025 results demonstrate a backlog that exceeds $25 billion and new award bookings of $12 billion, with 87 % of contracts reimbursable and 50 % or more expected to convert to revenue in 2026. The company’s disciplined shift to “smart lump sum” contracts and a high proportion of reimbursable work markedly reduce exposure to cost overruns, thereby tightening margin control and improving earnings sustainability. Management’s consistent guidance that the book‑to‑burn ratio will remain above one signals confidence that the pipeline will continue to feed the backlog at a healthy pace, ensuring ongoing revenue growth that the market has not yet fully priced in.
NuScale’s monetization provides a clean, cash‑positive catalyst that is unlikely to be fully reflected in current valuations. The company has already captured $1.35 billion in Q1 2026 and is set to close the program by Q2, delivering an MOIC of over 3.5× and an IRR exceeding 13 %. These proceeds, combined with a $1.4 billion share‑repurchase program, will both lift free cash flow and enhance earnings per share, creating a tangible upside for shareholders that is only beginning to materialise.
Urban Solutions has sustained a three‑year streak of new award bookings in the $9 billion range while its backlog has risen to $18.7 billion. Despite a $108 million cost spike on three legacy projects, the company is aggressively pursuing recoveries and change orders, and is on track to hand over three of those projects in 2026 and a fourth in 2027. Once those assets are closed, Urban Solutions is expected to realise its full margin potential of 3‑4 % in 2026, a significant upside over the current $2.2 % adjusted EBITDA margin reported for 2025.
Energy Solutions is repositioning its portfolio toward higher‑margin engineering services that are designed to unlock larger EPC awards in the next two years. Although the segment reported a $414 million loss in 2025 due largely to the Santos ruling, its new awards of $1.4 billion reflect a 20 % revenue share in 2026 and an expected margin of 4‑5 %. Coupled with the company’s focus on “smart lump sum” risk allocation, this shift signals a structural improvement in the segment’s profitability profile that the market has not yet fully appreciated.
Mission Solutions is poised to benefit from the U.S. government’s accelerated nuclear fuel supply chain initiatives, with a projected 6 % margin in 2026. The company secured a six‑year contract to extend its presence at the Portsmouth site and is actively pursuing new missions in the intelligence and defense sectors. Given that Mission’s backlog has only declined modestly from $2.7 billion to $2.2 billion, and that it has a higher-margin EPC profile than the other segments, the upside potential for earnings growth remains substantial.

Fluor’s 2025 results demonstrate a backlog that exceeds $25 billion and new award bookings of $12 billion, with 87 % of contracts reimbursable and 50 % or more expected to convert to revenue in 2026. The company’s disciplined shift to “smart lump sum” contracts and a high proportion of reimbursable work markedly reduce exposure to cost overruns, thereby tightening margin control and improving earnings sustainability. Management’s consistent guidance that the book‑to‑burn ratio will remain above one signals confidence that the pipeline will continue to feed the backlog at a healthy pace, ensuring ongoing revenue growth that the market has not yet fully priced in.
NuScale’s monetization provides a clean, cash‑positive catalyst that is unlikely to be fully reflected in current valuations. The company has already captured $1.35 billion in Q1 2026 and is set to close the program by Q2, delivering an MOIC of over 3.5× and an IRR exceeding 13 %. These proceeds, combined with a $1.4 billion share‑repurchase program, will both lift free cash flow and enhance earnings per share, creating a tangible upside for shareholders that is only beginning to materialise.
Urban Solutions has sustained a three‑year streak of new award bookings in the $9 billion range while its backlog has risen to $18.7 billion. Despite a $108 million cost spike on three legacy projects, the company is aggressively pursuing recoveries and change orders, and is on track to hand over three of those projects in 2026 and a fourth in 2027. Once those assets are closed, Urban Solutions is expected to realise its full margin potential of 3‑4 % in 2026, a significant upside over the current $2.2 % adjusted EBITDA margin reported for 2025.
Energy Solutions is repositioning its portfolio toward higher‑margin engineering services that are designed to unlock larger EPC awards in the next two years. Although the segment reported a $414 million loss in 2025 due largely to the Santos ruling, its new awards of $1.4 billion reflect a 20 % revenue share in 2026 and an expected margin of 4‑5 %. Coupled with the company’s focus on “smart lump sum” risk allocation, this shift signals a structural improvement in the segment’s profitability profile that the market has not yet fully appreciated.
Mission Solutions is poised to benefit from the U.S. government’s accelerated nuclear fuel supply chain initiatives, with a projected 6 % margin in 2026. The company secured a six‑year contract to extend its presence at the Portsmouth site and is actively pursuing new missions in the intelligence and defense sectors. Given that Mission’s backlog has only declined modestly from $2.7 billion to $2.2 billion, and that it has a higher-margin EPC profile than the other segments, the upside potential for earnings growth remains substantial.

Bear case

The company’s legacy infrastructure projects have continued to erode profitability, with a $108 million cost growth on three projects and four projects remaining in loss positions through 2026 and early 2027. These overruns not only reduce current margin but also expose Fluor to future change‑order liabilities, potentially compressing margins further as the company attempts to recover costs. The backlog conversion estimate of 50 % or more may prove optimistic given the high proportion of legacy work still in hand, raising the risk of revenue shortfalls.
The Santos ruling remains a material risk, having already generated a $643 million charge and a $642 million cash outflow in 2025. The pending appeal could produce additional liabilities or force further cost‑cutting measures, while the company’s cash position has already contracted from $3.0 billion to $2.2 billion. Negative operating cash flow of $387 million in 2025 and the projected $400 million tax burden from NuScale monetization in 2026 suggest that liquidity could become strained if the company’s core projects underperform or if unforeseen liabilities surface.
Energy Solutions remains a weak link, having moved from a $256 million profit in 2024 to a $414 million loss in 2025, and its revenue has fallen to $3.6 billion from $6.0 billion. The segment’s new awards of $1.4 billion are substantially lower than the $3.2 billion booked in 2024, indicating a slowdown in high‑margin opportunities. Even with a projected 4‑5 % margin, Energy Solutions still faces significant execution risk and limited upside if the company cannot secure larger EPC contracts.
Mission Solutions’ margin has slipped from 5.9 % to 3.5 % in 2025, and its backlog has shrunk from $2.7 billion to $2.2 billion. The segment is still burdened by $60 million in reserves and prior rulings, and its revenue growth is largely dependent on government contracts that can be volatile with fiscal cycles. A slowdown in defense spending or additional regulatory scrutiny could further erode Mission’s profitability and the company’s overall margin profile.
The company’s reliance on reimbursable contracts, while protective against fixed‑price overruns, also exposes it to prolonged cash‑flow pressures if clients shift to more fixed‑price or “smart lump sum” contracts that carry higher risk. A change in market sentiment toward more aggressive price competition could force Fluor to reduce its profit margins or to lose bids, thereby undermining the high booking volumes that the company relies on to sustain its growth trajectory.

The company’s legacy infrastructure projects have continued to erode profitability, with a $108 million cost growth on three projects and four projects remaining in loss positions through 2026 and early 2027. These overruns not only reduce current margin but also expose Fluor to future change‑order liabilities, potentially compressing margins further as the company attempts to recover costs. The backlog conversion estimate of 50 % or more may prove optimistic given the high proportion of legacy work still in hand, raising the risk of revenue shortfalls.
The Santos ruling remains a material risk, having already generated a $643 million charge and a $642 million cash outflow in 2025. The pending appeal could produce additional liabilities or force further cost‑cutting measures, while the company’s cash position has already contracted from $3.0 billion to $2.2 billion. Negative operating cash flow of $387 million in 2025 and the projected $400 million tax burden from NuScale monetization in 2026 suggest that liquidity could become strained if the company’s core projects underperform or if unforeseen liabilities surface.
Energy Solutions remains a weak link, having moved from a $256 million profit in 2024 to a $414 million loss in 2025, and its revenue has fallen to $3.6 billion from $6.0 billion. The segment’s new awards of $1.4 billion are substantially lower than the $3.2 billion booked in 2024, indicating a slowdown in high‑margin opportunities. Even with a projected 4‑5 % margin, Energy Solutions still faces significant execution risk and limited upside if the company cannot secure larger EPC contracts.
Mission Solutions’ margin has slipped from 5.9 % to 3.5 % in 2025, and its backlog has shrunk from $2.7 billion to $2.2 billion. The segment is still burdened by $60 million in reserves and prior rulings, and its revenue growth is largely dependent on government contracts that can be volatile with fiscal cycles. A slowdown in defense spending or additional regulatory scrutiny could further erode Mission’s profitability and the company’s overall margin profile.
The company’s reliance on reimbursable contracts, while protective against fixed‑price overruns, also exposes it to prolonged cash‑flow pressures if clients shift to more fixed‑price or “smart lump sum” contracts that carry higher risk. A change in market sentiment toward more aggressive price competition could force Fluor to reduce its profit margins or to lose bids, thereby undermining the high booking volumes that the company relies on to sustain its growth trajectory.

Consolidation Items Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

Peer comparison

Companies in the Engineering & Construction

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	PWR	Quanta Services, Inc.	94.45 Bn	92.00	3.32	5.99 Bn
2	FIX	Comfort Systems Usa Inc	62.27 Bn	60.85	6.84	0.15 Bn
3	EME	EMCOR Group, Inc.	39.28 Bn	30.85	2.31	-
4	MTZ	Mastec Inc	29.73 Bn	74.42	2.08	2.33 Bn
5	APG	APi Group Corp	20.35 Bn	-75.28	2.57	2.76 Bn
6	STRL	Sterling Infrastructure, Inc.	15.11 Bn	52.06	6.07	0.29 Bn
7	BLD	TopBuild Corp	13.15 Bn	25.18	2.43	2.85 Bn
8	DY	Dycom Industries Inc	11.97 Bn	40.22	2.31	0.94 Bn

Research Tools

Fluor Corp (NYSE: FLR)

About

Investment thesis

Bull case

Bear case

Consolidation Items Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

Peer comparison

Research Tools

Fluor Corp (NYSE: FLR)

About

Investment thesis

Bull case

Bear case

Consolidation Items Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

Peer comparison

Create an account

Sign In

Reset Password