That $6bn TenderBook..., page-164

Beyond any bush telegraph rumours we have made it on to a Fortescue shortlist was a broker prediction we would not only be shortlisted but would win contracts:
Revisiting an old link :

Back in July FN Arena noted
...... “Brokers more confident in NRW's ability to win further work in Pilbara”
Quoting UBS :
... “The broker's FY19 estimates of work in hand increase to $963m for revenue guidance of $1.1bn, implying 86% revenue coverage. UBS has set margin expectations for the civil division below industry targets, i.e. 4.2% versus 5%, which provides a level of confidence around the earnings profile.

The broker expects $3bn in civil works to be offered during FY19-21 from replacement and sustaining capital expenditure in Western Australian iron ore. South Flank is the first major iron ore project to award civil contracts but its civil works are materially smaller than the projects likely to be emanating from Rio Tinto ((RIO)) and Fortescue Metals ((FMG)).

UBS expects works for Rio Tinto's Koodaideri and Fortescue's Eliwana will be awarded towards the end of the first half of FY19. Collectively, the broker calculates the civil works for these projects which NRW Holdings can address are worth around $1.6bn.

The broker currently assumes an overall win rate of around 21% for the company. A 33-50% win rate would drive a 12-29% uplift to FY20 EPS estimates, all else being equal. UBS has a Buy rating and $1.90 target.

Moelis upgrades estimates for operating earnings (EBITDA) for FY18 and FY19 by 2% and 9% respectively on the back of the win. The broker's revenue estimate of $1.11bn is in line with recent company guidance and represents revenue growth in excess of 40% over FY18.

Moelis considers the stock one of the better ways to play the upcoming reinvestment cycle in Western Australia and for gaining exposure to the potential for further contracts to be awarded over coming months from Fortescue Metals and Rio Tinto. Nevertheless, the broker considers the risk/reward balanced and moves to a Hold rating on valuation grounds, with a target of $1.87.

Citi maintains a Buy rating and $1.95 target, now more confident regarding the company's ability to capitalise on the increase in iron ore expenditure in the Pilbara. Citi increases FY19-20 estimates for net profit by 2-5%.”


More from this story here : https://www.fnarena.com/index.php/2018/07/19/nrw-holdings-kicks-off-with-iron-ore-win/


Interesting to see - thanks to other work - NRW beat the 40% expectation yet STILL hasn’t added any potential work from FMG or RIO .
As I think was said at the AGM, the company is actually sitting pretty regardless of any more wins this half year.

Interesting to see the price so much lower than conservative broker estimates too...