Why Fluor Stock Flopped Today

Fluor (NYSE: FLR) published its final earnings report for 2024 on Tuesday, and investors reacted by trading the company's stock down aggressively. This resulted in a nearly 9% share-price erosion on the day, a performance that was notably worse than the 0.2% gain of the bellwether S&P 500 index.

Headline numbers going in different directions

Fluor's fourth quarter of that year saw the engineering and construction conglomerate earn $4.26 billion, 11% higher than in the same period of 2023. Going in the other direction was non-GAAP (adjusted) net income, which fell by 28% to $84 million ($0.48 per share).

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Unfortunately for Fluor, neither headline metric reached the consensus analyst estimate. On average, pundits tracking the stock were modeling $4.48 billion for revenue and felt the company would net $0.78 per share in adjusted bottom-line profitability.

The company put a positive spin on these numbers, quoting CEO David Constable as saying that they

reflect our four-year journey of building a robust reimbursable backlog across diverse end markets, strengthening our capital structure, developing strong engineering and project execution teams, and commencing our capital allocation program.

Bottom-line guidance misses

In the earnings release, Fluor proffered selected profitability guidance for the entirety of 2025. Management believes the company will post earnings before, interest, taxes, depreciation, and amortization (EBITDA) of $575 million to $675 million. Adjusted earnings per share (EPS), meanwhile, should come in at $2.25 to $2.75.

Like the trailing results, however, that earnings figure fell short of the average analyst estimate ($2.95).

Fluor has to be commended for the double-digit revenue improvement. However, investors are right to be concerned about that rather significant bottom-line miss, particularly considering that many of the company's client bases are doing well these days.

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Eric Volkman 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.