The Monadelphous Group Ltd (ASX: MND) share price may rise today on the announcement of multiple new contracts with a combined value of approximately $150 million.
About Monadelphous Group
Monadelphous Group is a Perth-headquartered engineering group providing construction, maintenance and industrial services. Monadelphous has a major office in Brisbane and projects, facilities and workshops across Australia, New Zealand, China, Mongolia, Papua New Guinea and the US.
New Contracts
Monadelphous announced multiple new contracts this morning with other ASX-listed companies like South32 Ltd (ASX: S32), Rio Tinto Limited (ASX: RIO) and Origin Energy Ltd (ASX: ORG).
Monadelphous won a contract with Origin for the construction of the Talinga-Orana Gas Gathering Station which is expected to be completed by March 2020.
Monadelphous was also awarded a three-year contract for the supply of shutdown and mechanical services at South32’s Worsley Alumina Refinery.
Two new contracts with Rio Tinto were also announced, which were a contract for the refurbishment of a high-grade iron ore screenhouse and a three-year contract to provide rope access and tank inspection services at Rio Tinto’s alumina refinery near Gladstone, Queensland.
The total value of the contracts is approximately $150 million. Monadelphous Managing Director Rob Velletri said, “we are pleased to have been awarded new contracts with a number of our existing customers, highlighting the strength of our relationships and our leading reputation for quality delivery”.
Is Monadelphous A Buy?
Monadelphous has proven its ability to consistently win contracts with its existing customers, and with the share price up 35% year-to-date and a fully franked dividend yield of 3.09% on offer, the shares can look tempting.
I don’t follow the company closely enough to comment on the valuation, but the full-year results that are expected on 20th August might be something to look out for.
For now, I’d rather invest in one of the companies in the free report below.
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Disclosure: At the time of writing, Max does not own shares in any of the companies mentioned.
