Babcock (NYSE:BW) Shares Gap Up - Should You Buy?

Key Points

• Babcock shares jumped 9.2%, opening at $7.51 versus the prior close of $7.17 and later trading at $7.75 on more than 1.3 million shares.
• Analyst sentiment is mixed: four analysts rate the stock Buy, two Hold, and one Sell. The consensus rating is Hold, with an average price target of $15.40 versus the reported trading price.
• The company beat quarterly earnings expectations, reporting $0.04 in EPS versus $0.02 expected and revenue of $319.72 million versus $196.95 million forecast. However, Babcock remains unprofitable, with a negative net margin and a high debt-to-equity ratio of 4.21.

Babcock (NYSE:BW - Get Free Report)'s share price gapped up before the market opened on Friday . The stock had previously closed at $7.17, but opened at $7.51. Babcock shares last traded at $7.75, with a volume of 1,336,609 shares trading hands.

Wall Street Analysts Forecast Growth

A number of brokerages have issued reports on BW. Weiss Ratings raised shares of Babcock from a "sell (d-)" rating to a "sell (d+)" rating in a research report on Tuesday, August 11th. Needham & Company LLC assumed coverage on shares of Babcock in a research report on Monday, August 31st. They issued a "buy" rating and a $20.00 target price for the company. Finally, Wall Street Zen lowered shares of Babcock from a "buy" rating to a "hold" rating in a research note on Sunday, August 23rd. Four investment analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has given a Sell rating to the company's stock. According to MarketBeat, the stock currently has an average rating of "Hold" and a consensus price target of $15.40.

Babcock Trading Up 9.2%

The company has a current ratio of 1.45, a quick ratio of 1.33 and a debt-to-equity ratio of 4.21. The company has a market cap of $1.17 billion, a PE ratio of -43.64 and a beta of 1.19. The stock has a 50 day moving average price of $9.23 and a 200 day moving average price of $13.39.

Babcock (NYSE:BW - Get Free Report) last issued its quarterly earnings results on Monday, August 10th. The technology company reported $0.04 earnings per share for the quarter, topping the consensus estimate of $0.02 by $0.02. Babcock had a negative return on equity of 4.51% and a negative net margin of 2.17%.The company had revenue of $319.72 million for the quarter, compared to analysts' expectations of $196.95 million. Sell-side analysts predict that Babcock will post 0.27 EPS for the current fiscal year.

Insider Transactions at Babcock

In other Babcock news, Director Philip Moeller purchased 5,000 shares of the stock in a transaction that occurred on Thursday, August 13th. The stock was bought at an average cost of $9.50 per share, with a total value of $47,500.00. Following the transaction, the director directly owned 240,809 shares in the company, valued at approximately $2,287,685.50. The trade was a 2.12% increase in their position. The transaction was disclosed in a legal filing with the SEC, which can be accessed through the SEC website. 2.80% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Babcock

Hedge funds and other institutional investors have recently bought and sold shares of the business. Marshall Wace LLP boosted its position in shares of Babcock by 93.0% in the 2nd quarter. Marshall Wace LLP now owns 395,945 shares of the technology company's stock worth $380,000 after purchasing an additional 190,814 shares in the last quarter. Nomura Holdings Inc. increased its position in Babcock by 58.2% during the 2nd quarter. Nomura Holdings Inc. now owns 127,382 shares of the technology company's stock valued at $123,000 after buying an additional 46,884 shares in the last quarter. Vanguard Group Inc. raised its stake in Babcock by 54.3% during the third quarter. Vanguard Group Inc. now owns 4,423,243 shares of the technology company's stock valued at $12,827,000 after buying an additional 1,556,692 shares during the last quarter. Jefferies Financial Group Inc. bought a new stake in Babcock in the third quarter worth $74,000. Finally, Legal & General Group Plc bought a new stake in Babcock in the third quarter worth $14,086,000. Hedge funds and other institutional investors own 83.17% of the company's stock.

Babcock Company Profile

Babcock & Wilcox Enterprises, Inc NYSE: BW is a specialized provider of energy and environmental technologies and services serving power generation and heavy industrial markets. The company designs, manufactures and maintains critical components and systems that support the safe and efficient operation of both fossil-fuel and renewable power facilities. Its core offerings include industrial and utility boilers, environmental control systems for emissions reduction, and aftermarket support services ranging from inspection and maintenance to spare parts management.

In addition to its boiler and emissions control portfolio, Babcock & Wilcox Enterprises delivers lifecycle solutions aimed at enhancing plant performance and compliance.

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