Why Orion Group Stock Dropped, Then Popped, Then Dropped Again
Key Points
Orion Group reported a loss for the quarter but a profit for the year at the end of Q4 2025.
Free cash flow was positive for the year, counting sales of property and equipment.
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Orion Group Holdings (NYSE: ORN) stock, the maritime construction company, tumbled nearly 9% in early trading Wednesday before reversing to gain more than 4%... before reversing again and giving back all its gains.
As of 3:10 p.m. ET Wednesday, the stock is down 0.5% -- but check back five minutes from now, because clearly that may change.
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Orion Group Q4 earnings
Orion reported its Q4 earnings results last night, and investors don't seem to know what to make of them -- so let's see if I can help with that. Going over the numbers, it appears Orion grew its sales 7.5% year over year in the final quarter of 2025, but flipped from a $0.17 per share profit a year ago, to lose $0.01 per share this time around.
That loss probably explains why Orion couldn't hold onto its gains today.
The full-year picture was a little better. Here again, we see Orion growing sales -- up 7% to $852.3 million -- but this time the earnings flipped from a GAAP loss of $0.05 per share in 2024 to a profit of $0.06 per share for all of 2025.
The free cash flow picture was murkier. Orion generated $28.1 million in cash from operations in 2025 and spent $38.9 million on capital expenditures. That makes free cash flow negative, except for the fact that Orion generated $25.2 million in cash from sales of property and equipment.
Factor that into the picture, and Orion becomes FCF-positive again: $14.4 million.
Is Orion stock a buy?
At $550 million in market cap, Orion trades for 38 times price-to-free cash flow ratio. Management is targeting sales growth of less than 9% this year, though.
Assuming FCF grows in tandem, the stock looks too expensive to buy.
Should you buy stock in Orion Group right now?
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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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