Infrastructure Group Continues to Impress

by: Trader Mark posted on: December 10, 2007 | about stocks: CBI / FLR / FWLT / JEC / KBR / MDR / SGR

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I mentioned last week the Infrastructure Group recovery [Quite a Recovery for Infrastructure Group] - some of these charts are absolute things of beauty now that the market has simply bounced a bit. Coming into the week, all but McDermott had regained the 50 day moving average and looked poised for nice moves up, if the market would just be benign for a while.

I put these stocks into 3 groups right now based on technicals...

A) The following 3 charts look identical - and we've reached all time highs in all 3 names: Foster Wheeler (FWLT), Chicago Bridge & Iron (CBI), Jacobs Engineering (JEC)

B) KBR (KBR), Fluor (FLR) have cleared resistance very nicely and are making nice moves, but not at all time highs. Technically nice positions but can be expected to pull back to support if market weakens.

C) Bringing up the rear in the category of 'finally' pushing back through resistance are McDermott (MDR) and Shaw Group (SGR). These still stand a chance of falling through their main line of support (50 day moving average) if the market weakens.

I am a little perplexed with Shaw Group - they reported earnings October 10th, yet somehow reported earnings again yesterday which is less than 2 months later. Very strange; I must assume last quarter's (Oct 10th) report was filed very late. They did 'miss,' but the backlog is just tremendous - $14.7B, up 57% year over year. I just have to go investigate how they reported 2 quarters so quickly.

As always the big boys "knew" ahead of "us"... Shaw Group, after a great earnings 2 months ago, rallied hard, corrected like the rest of the group but was much weaker on the recovery - which I kept mentioning was strange considering how good the last earnings report was. Well now we know why. Funny, isn't it, how price action normally telegraphs the news ahead of time? Funny in a 'this game is sure not an even playing field' kind of way.

Disclosure: Long all names except Fluor in fund; long Foster Wheeler in personal account