Kbr, Inc. (NYSE: KBR)

Sector: Industrials Industry: Engineering & Construction CIK: 0001357615
P/B 3.88
P/E 14.94
P/S 0.70
Market Cap 5.68 Bn
ROIC (Qtr) 10.09
Div Yield % 1.47
Rev 1y % (Qtr) -0.31
Total Debt (Qtr) 2.85 Bn
Debt/Equity (Qtr) 1.95

About

KBR, Inc. (KBR), a Delaware corporation, is a prominent player in the science, technology, engineering, and logistics support solutions industry, serving governments and companies across the globe. The company's operations are primarily divided into two core business segments: Government Solutions and Sustainable Technology Solutions, with an additional non-core segment called Other. Government Solutions is the backbone of KBR's business, providing full-life cycle support solutions to defense, intelligence, space, aviation, and other programs...

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Analysis

Pros

  • Healthy cash reserves of 539M provide 11.72x coverage of short-term debt 46M, demonstrating strong liquidity position and minimal refinancing risk.
  • Tangible assets of 3.23B provide exceptional 9.69x coverage of deferred revenue 334M, showing strong service capability backing.
  • Robust free cash flow of 468M exceeds capital expenditure of 47M by 9.96x, indicating strong organic growth funding capability.
  • Robust tangible asset base of 3.23B provides 10.30x coverage of working capital 314M, indicating strong operational backing.
  • Operating cash flow of 515M fully covers other non-current liabilities 272M by 1.89x, showing strong long-term stability.

Cons

  • Operating cash flow of 515M provides thin coverage of dividend payments of (83M) with a -6.20 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 539M provide limited coverage of acquisition spending of (5M), which is -107.80x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Free cash flow of 468M represents just -93.60x of debt issuance (5M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Operating cash flow of 515M barely covers operating expenses of (7M) with a -73.57 ratio, suggesting thin operational efficiency margins and limited flexibility.
  • Retained earnings of 1.61B provide limited buffer against comprehensive income items of (896M), which is -1.79x, indicating elevated exposure to market risks.

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. 65.02 Bn 63.86 2.39 6.02 Bn
2 FER Ferrovial SE 48.37 Bn 14.34 5.08 -
3 FIX Comfort Systems Usa Inc 34.25 Bn 40.89 4.12 0.39 Bn
4 EME EMCOR Group, Inc. 28.27 Bn 25.01 1.74 0.42 Bn
5 MTZ Mastec Inc 17.18 Bn 51.88 1.25 2.77 Bn
6 APG APi Group Corp 16.45 Bn 105.48 2.15 3.05 Bn
7 J Jacobs Solutions Inc. 16.43 Bn 56.79 1.37 2.71 Bn
8 ACM Aecom 13.10 Bn 23.31 0.81 3.23 Bn

Industry Comparisons

Current Valuation

Metric Value Industry Percentile
EV to Assets 1.22 1.60
EV to Cash from Ops. 15.74 6.21
EV to Debt 2.85 12.02
EV to EBIT 11.87 16.63
EV to EBITDA 11.00 13.11
EV to Free Cash Flow [EV/FCF] 17.32 64.21
EV to Market Cap 1.43 1.27
EV to Revenue 1.01 1.63
Price to Book Value [P/B] 3.88 5.92
Price to Earnings [P/E] 14.94 28.08

Dividend Metrics

Metric Value Industry Percentile
Dividend Coverage Ratio 4.58 2.56
Dividend Payout Ratio % 22.20 17.64
Dividend per Basic Share 0.65 0.24
FCF Dividend Payout Ratio % 17.64 8.25
Interest Coverage 4.14 80.17

Growth Metrics

Metric Value Industry Percentile
Capex Growth (1y) % 16.07 -167.27
Cash and Equivalents Growth (1y) % 16.67 637.93
Dividend Growth (1y) % 10.26 2.92
EBIAT Growth (1y) % 21.66 92.73
EBITDA Growth (1y) % 8.54 8.03
EBIT Growth (1y) % 17.15 85.41
EBT Growth (1y) % 14.35 42.19
EPS Growth (1y) % 22.78 43.98
FCF Growth (1y) % 4.23 -20.57
Gross Profit Growth (1y) % 10.14 32.55

Liquidity Ratios

Metric Value Industry Percentile
Asset Utilization Ratio 1.21 1.14
Cash Payout Ratio 0.15 0.05
Cash Ratio 0.30 0.38
Current Ratio 1.18 1.54
Debt to Equity Ratio 1.95 0.89
Interest Cover Ratio 4.14 80.17
Times Interest Earned 4.14 80.17

Profitability

Metric Value Industry Percentile
EBITDA Margin % 10.60 0.40
EBIT Margin % 8.47 -2.30
EBT Margin % 6.43 -4.58
Gross Margin % 14.30 20.40
Net Profit Margin % 4.70 -5.95