Shares of Shaw Group rose on Thursday after the construction and engineering contractor posted a better-than-expected third-quarter profit and reaffirmed its outlook for the year.
The stock advanced $5.49, or 9.9 percent, to $60.80.
After the closing bell on Wednesday, the Baton Rouge, La., company said its adjusted quarterly profit came in at an $58.7 million, or 70 cents per share, on $1.82 billion in revenue.
Analysts polled by Thomson Financial expected a profit of 62 cents per share on revenue of $1.89 billion.
The company also reaffirmed its adjusted profit prediction for 2008 of $2.30 per share, in line with Wall Street estimates.
In a note to investors, Citi Investment Research analyst Brian Chin was upbeat on Shaw's results, particularly its nuclear power segment, which he said should see new awards in the next 12 months.
He also said the company should witness "interesting activity" in its nuclear segment from international customers, particularly after a recent agreement allowing sales of civilian nuclear power technology from the U.S. to India.
"Shaw's real opportunity is in South Africa, the (United Kingdom), India and China," Chin wrote. "All four regions could award potential contracts in the next 12 months."
Chin maintained his "Hold" rating and $77 price target on Shaw. Engineering and construction companies might be under pressure in the near future, he said, if commodity prices begin to ease.
Separately, Capital One Southcoast analyst Joseph Gibney raised his price target to $66 from $64 in a note. He said the company's margins are improving and its nuclear segment remains strong, but shares appear to be at about a fair price.
Shares of Shaw have traded between $40.12 and $77.30 in the last 52 weeks. The stock is down about 8 percent for the year.
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