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Hurricane Watch 2024: Beryl could be the start of a busier storm season for E&C's

Published 10/07/2024, 08:56 pm
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PWR
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Hurricane Beryl's landfall in Texas as a Category 1 storm serves as a reminder of the potential impact of the hurricane season on engineering and construction (E&C) companies, according to Citi analysts.

While Beryl caused moderate damage to Houston's electric infrastructure, Citi highlights potential benefits for some engineering and construction firms.

"PWR, in particular, can see moderate earnings/stock impacts from major storms," states the Citi note.

CenterPoint Energy (NYSE:CNP) reported nearly 2.7 million homes and businesses without power at the peak of outages in Houston. Citi believes the recovery and restoration work will provide a "modest revenue/earnings tailwind for PWR, mostly in 3Q24."

Historically, certain E&C stocks have outperformed in the short term following major storms, according to Citi. They mention PWR as a potential beneficiary, along with ACM, MTZ, and FLR.

However, they downplay the possibility of Beryl significantly impacting companies beyond PWR due to the storm's size.

As the hurricane season progresses, it will be important to monitor the path and intensity of future storms to gauge potential impacts on the E&C sector.

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