HARTFORD, Conn. (AP) ¿ An analyst raised her share price targets for six engineering and construction companies Thursday, predicting benefits from higher oil and natural gas prices.
Analyst Tahira Afzal of KeyBanc Capital Markets wrote in a note to investors that key assumptions are that oil prices hold at more than $60 a barrel into next year "with an outlook of sustainability beyond the 2010 time frame."
She added that industrial demand in the United States "remains tepid but does not materially weaken further," and predicted federal stimulus spending will prompt more construction spending by federal agencies, offsetting a decline in state transportation spending.
Rising oil and natural gas prices benefit engineering and construction companies that build refineries, pipelines and other key accessories for energy projects.Afzal raised her price targets for Baker Michael Corp., McDermott International Inc., Matrix Service Co., MYR Group Inc., Quanta Services Inc. and Team Inc. Her new price targets assume that regulators will continue to push for renewable energy as one of several power sources available to residences and businesses, she said.