Recently, Matrix Service Co (NASDAQ:MTRX) announced its third-quarter earnings results. Revenue increased from $183.9 million in the third quarter last year to nearly $226 million in Q1 2013 while net income experienced a year-over-year growth of 34% to $6.52 million, or $0.25 per share. In the third quarter, the company had a backlog of more than $644 million. The market values Matrix Service at only 8.72 times EV/EBITDA. However, the PEG ratio seems to be high at 1.6.
Halliburton Company (NYSE:HAL) is considered a leader in providing exploration, development and exploration of oil and natural gas to major global oil/gas companies, operating in two main business segments: Completion and Production, and Drilling and Evaluation. Halliburton has a diverse customer base, with no customer accounting for more than 10% of its total revenue. With the recent fracking/hydraulic fracturing boom, Halliburton Company (NYSE:HAL)’s business has also been booming, providing fracking services for developing shale natural gas and oil.
The company kept developing new technology for the oil/gas industry. At the end of April, Halliburton announced that one of its customers, Chevron Corporation (NYSE:CVX), completed three wells in the Gulf of Mexico with the help of Halliburton’s Enhanced Single-Trip Multizone FracPac system. According to Ron Shuman, the Senior VP of the company’s southern and Gulf of Mexico regions, the system let users to have “a very aggressive stimulation with rates up to 45 barrels per minute and volumes greater than 400,000 pounds of 16/30 high strength proppant.” Indeed, with a single trip rather than multiple trips, oil/gas operators could significantly save time and costs with higher asset optimization.
The company looks cheap with an EV multiple of only 7.5 and PEG ratio of just 0.78. The company also offers investors the highest dividend yield of the trio at 1.20%. Chicago Bridge ranked second with only 0.30% dividend yield, Matrix Service does not pay any dividend.
Buffett’s bullish about The Shaw Group acquisition?
I personally think that Buffett was interested in Chicago Bridge due to the recent acquisition of The Shaw Group. According to ENR, Chicago Bridge is ranked third in the petroleum industry while The Shaw Group is ranked second in the power industry. That would give Chicago Bridge substantial exposure to the power industry and make it one of the most best energy-focused companies in the world.
The article Following Warren Buffett Into Chicago Bridge & Iron originally appeared on Fool.com is written by Anh HOANG.
Anh HOANG has no position in any stocks mentioned. The Motley Fool recommends Halliburton. Anh is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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