Babcock & Wilcox Enterprises, Inc. (BW) provides advanced fossil and renewable power generation and environmental equipment. B&W’s technologies support a circular economy, diverting waste from landfills to use for power generation and replacing fossil fuels, while recovering metals and reducing emissions
The company had a solid quarter where revenue rose 49.8% year over year and net income increased to $3.1 million, compared to a loss of $18.1 million in the same quarter last year. BW launched its ClimateBright platform in May with a pipeline of potential carbon capture and hydrogen combustion opportunities.
The firm had $144 million in cash as of the most recent quarter compared to only $3 million in short-term debt. Analysts expect sales to rise 33.8% for the year. However, earnings are expected to fall 95.1% in the current quarter.
The stock appears slightly overvalued with a forward P/E of 23.64. The stock was showing bullish momentum from the end of last year into March of this year, but performance has been mixed since, as shown in the chart below.
Take a look at the 1-year chart of BW below with added notations:
BW has tested the $6.50 level (green) as support several times over the course of the past six months. The stock has fallen back down to that support again.
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A break of $6.50 could mean much lower prices for the stock. Therefore, if the stock were to break below the support, a short position could be entered.
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BW shares were unchanged in premarket trading Monday. Year-to-date, BW has gained 86.61%, versus a 20.70% rise in the benchmark S&P 500 index during the same period.
About the Author: Christian Tharp
I am an expert stock market coach having helped over 4000 beginner and advanced traders & investors from around the world take control of their financial futures. I also write stock market related articles for the Adam Mesh Trading Group and Yolo Publishing. More...
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