NEW YORK (TheStreet) -- Shares of McDermott International (MDR - Get Report) closed lower by 4.53% to $3.79 on Monday after the stock was downgraded to "neutral" from "outperform" at Credit Suisse earlier today. The firm also raised its price target to $4.04 from $3.50.
The Houston-based engineering and construction company focuses on building and designing offshore oil and natural gas facilities.
The firm believes investors fully appreciate the operational improvements and increased risk management implemented by the management team, the company's ability to capture brownfield work in the Middle East and improving visibility somewhat into 2017.
"However, the global macro remains challenged and even with the recent rally in crude we see the offshore business as most challenged for the medium term. Additionally, MDR's energy offering is less diverse and recurring earnings stream is less meaningful relative to its engineering and construction (E&C) peers," Credit Suisse wrote in a note.
Lower oil prices also pressured the stock today.
Crude oil (WTI) is falling 3.32% to $35.57 per barrel and Brent oil is slumping 2.74% to $37.62 per barrel this afternoon.
Last week was a volatile week for the stock, TheStreet's David Peltier wrote in his most recent Stocks Under $10 Weekly Round Up.
"The company remains leveraged to growing demand for infrastructure in the Middle East," he added.
(McDermott is held in David Peltier's Stocks Under $10 portfolio. See all of his holdings with a free trial.)
Separately, TheStreet Ratings Team has a "Sell" rating with a score of D on the stock.
This is driven by multiple weaknesses, which should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks covered.
The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, weak operating cash flow and poor profit margins.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: MDR