Analyst Upgrades McDermott On Oil, Gas Projects

HARTFORD, Conn. (AP) — Shares of McDermott International Inc. jumped Tuesday as an analyst upgraded the engineering and construction company as one of the few that will boost earnings in 2010, primarily due to oil and gas production.

Credit Suisse analyst Jamie Cook upgraded the Houston company to "Outperform" from "Neutral." She increased her price target to $31 from $27.

More than half of McDermott's revenue is generated from the upstream market, or exploration and production, which Cook called "the sweet spot of the oil and gas market over the next several years."

"Bidding activity in the Middle East and Asia Pacific remains very high, with sizable awards coming at the end of 2009 and beyond," she said in a note to investors.

Requests for proposals for work in the Caspian Sea area also are a year ahead of schedule, Cook said.

She increased her 2010 earnings estimate to $2.05 per share from $1.95 per share and raised her 2011 estimate to $2.40 per share from $2.30 per share.