The shares of McDermott International (NYSE:MDR) have rallied by 30.35% in today’s trading session after the receipt of a large lump sum contract from Saudi Aramco for several fields offshore of Saudi Arabia. The company didn’t mention any specific amount for the contract but called it “the largest single award for McDermott’s Middle East Area operations in company history.” According to the press release, the work will be executed through the second quarter of 2018, ensuring continued projects for the company. Saudi Aramco has become an even bigger client for McDermott International (NYSE:MDR) than it was after the earlier second long term agreement (LTA) in June 2015 between the two companies.
While discussing the details of the project, David Dickson, President and CEO of McDermott, said, “Our detailed knowledge and understanding of Saudi Aramco’s objectives, as well as our proven excellence in the Kingdom and the region continue to set us apart. Delivering on strong project execution and integrating McDermott’s local knowledge are critical to future success as we execute these and other projects for Saudi Aramco.”
McDermott International (NYSE:MDR) announced its second quarter financial results on August 10, reporting earnings per share of $0.04 against a loss of $0.03 in the prior-year quarter. The shares of McDermott International (NYSE:MDR) have grown by 50.17% year-to-date, an impressive performance compared to its peers in the struggling energy sector. Shares are still down by over 40% over the past 12 months however. The smart money was slightly bearish on McDermott International during the second quarter, with the aggregate holdings in the stock from the funds in our database up by 30.50% to $196.84 million, despite 39.06% growth in the share price during the same period. The hedge fund ownership rose by two to 20 during the quarter.
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Insiders are likely to have a better understanding of the management and ongoing operations of the company than an average investor. The insiders of McDermott International (NYSE:MDR) were however have been inactive in 2015, providing us with no additional insight into the company’s future prospects.