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Worley Parsons (WOR) $16.01

We bought Worley Limited (WOR) yesterday in the Flagship Growth Portfolio ahead of their investor day today, selling Woodside Energy (WDS) to fund the acquisition. While we are not ‘negative’ on WDS, we do believe the earnings outlook for Worley is better for two main reasons.

  1. There is plenty of work for this consulting and advisory business in resources & energy,  particularly given the huge energy transition that is underway – WOR will be a key player in global decarbonisation. This will grow top-line revenue, however, this is well known and understood by the market, and therefore in the price of the shares.
  2. However, WOR and most other contractors have traditionally struggled with margins, but there are signs from other global competitors that margins are expanding and this is the area the market is not appreciating in MM’s view. Margin expansion is the key for WOR.
WOR
MM is bullish & now long WOR
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Worley Ltd (WOR)
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