Goldfield Corp (NYSEMKT:GV)- holding its ground beyond the CREZ field

Posted by admin June 4, 2013 0 Comment 1756 views

Goldfield Corp (NYSEMKT:GV) had been a laggard for quite some time but things started looking up for the company in 2012 when it bagged a CREZ project. This has  made a marked difference in its operations and  increased the company’s  backlog from $12.2M to $77.8M. Would it be right to chalk-up Goldfield Corp’s operational to this one large contract? Of course, mention of the CREZ project cannot go without a mention of companies such as Irby Corporation that beat GV and three other bidders for another CREZ project later in the year.

Looking beyond CREZ

The CREZ project puts a lot of pressure on company operations and in the absence of this project can Goldfield Corp (NYSEMKT:GV) build its core backlog? A look at the company’s performance in the first quarter of 2012 indicates that the company had reported core revenues of $17.1M. This was at a point of time when the company’s resources were not being borrowed by the CREZ project. It seems like GV is now in a slightly stronger position and will be able to support a quarterly revenue run-rate that is higher partly after looking at its 2012 Q4 results.

In addition to this, in 2012, the company had announced its decision to upgrade its equipment. This will surely help the company take on more projects. The management has also been making some bullish comments, since.

Also in the game…

Quanta Services, Inc. (NYSE: PWR) and Willbros Group Inc (NYSE:WG) are two companies from the power and energy infrastructure field that GV constantly gets compared to. However, it must be kept in mind that both these companies operate on  much larger scale than the one that GV operates on. They are multi-billion dollar enterprises, at different segments of their growth curves and expected to grow revenues that will be under 10% in 2013 as well as in 2014. WG entered the electric-construction segment only in 2010.

The quanta leap

Quanta Services, Inc. (NYSE: PWR) has announced expansion of its master-agreement with Competitive Renewable Energy Zone projects. These have been assigned to Electric Transmission Texas, LLC by the PUCT. Under the agreement, PWR will initially have exclusive rights to negotiate construction of the 460 miles-stretch of the new 345-kV transmission-line projects in West Texas. Previously, Quanta held the initial bidding-rights to around 250 miles of the projects. It has more holding-power, yes but companies like Goldfield Corp (NYSEMKT:GV) will still be in  the fray.

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