GIFI  Gulf Island Fabrication Inc.

Exchange

NASDAQ

Sector

Capital Goods

Industry

Metal Fabrications

Market Cap.

178.21M

Vuru Grade

22.50/100

Current Price

$12.00
-0.05 (-0.41%)

Growth Price

$2.40
Overvalued by 80.01%

Stability Price

$2.13
Overvalued by 82.27%

Company Metrics

  • P/E 40.13
  • P/S 0.87
  • P/B 0.73
  • EPS -1.38
  • Cash ROIC 157.82%
  • Cash Ratio 1.45
  • Dividend 0.04 / 0.33 %
  • Avg. Vol. 86,047.00
  • Shares 14.85M
  • Market Cap. 178.21M

Company Description

Gulf Island Fabrication, Inc. operates as a fabricator of offshore drilling and production platforms, hull and deck sections of floating production platforms, and other specialized structures used in the development and production of offshore oil and gas reserves. It fabricates jackets and deck sections of fixed production platforms; hull, tendon, and/or deck sections of floating production platfo... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Flush With Cash And Growing Backlog, Gulf Island Fabrication Positioned For ...
Seeking Alpha - Jun 21, 2017
Gulf Island Fabrication, Inc. (NASDAQ:GIFI) is a leading fabricator of offshore oil and gas platforms, onshore modules, marine vessels and other specialized structures.
Gulf Island Fabrication, Inc. Announces Contract Award from Oregon State ...
Business Wire (press release) - Jul 13, 2017
HOUSTON--(BUSINESS WIRE)--Gulf Island Fabrication, Inc. (NASDAQ: GIFI) today announced that through its subsidiary Gulf Island Shipyards, LLC, it has received a contract award from Oregon State University for the construction of a Regional Class ...
Gulf Island Fabrication Looks Like Deep Value
Seeking Alpha - Jun 15, 2016
... there appear to be a few more options. One interesting one is Gulf Island Fabrication (NASDAQ:GIFI) - a small, underexplored fabricator and shipbuilder located in Texas and Louisiana.
Covington's LeeVac Shipyards sells assets to Gulf Island Fabrication for $20 ...
NOLA.com - Jan 5, 2016
Gulf Island, like most in the industry, has struggled to sign new contracts for work as oil prices linger at near-historic lows.
Gulf Island Fabrication's (GIFI) on Q1 2017 Results - Earnings Call Transcript
Seeking Alpha - Apr 29, 2017
Welcome ladies and gentlemen, to the Q1 2017 Gulf Island Fabrication, Inc. Earnings Conference Call. [Operator Instructions].
Gulf Island Fabrication, Inc. Announces Contingent Notice of Intent to Award
Business Wire (press release) - May 8, 2017
HOUSTON--(BUSINESS WIRE)--Gulf Island Fabrication, Inc. (NASDAQ: GIFI) today announced, that through its subsidiary Gulf Island Shipyards, LLC, it has received a contingent notice of intent to award from Oregon State University for the construction of ...
Gulf Island Fabrication, Inc. Announces Contract Award
Business Wire (press release) - Jun 1, 2017
HOUSTON--(BUSINESS WIRE)--Gulf Island Fabrication, Inc. (NASDAQ: GIFI) today announced, that though its subsidiary Gulf Island Shipyards, LLC, it has executed a contract with Suderman & Young Towing Company for the construction of four (4) Z-Tech ...
Gulf Island Fabrication's (GIFI) CEO Kirk Meche on Q4 2016 Results - Earnings ...
Seeking Alpha - Feb 24, 2017
Good morning and welcome ladies and gentlemen to the Q4 2016 Gulf Island Fabrication Inc. earnings conference call. All participants will be in a listen-only mode for the duration of the presentation.
Gulf Island to shift all fab ops to Houma, sell Texas yards - Marine Log
Gulf Island Fabrication's CEO Kirk Meche on Q2 2017 Results - Earnings Call ...
Seeking Alpha - Jul 28, 2017
Good morning and welcome ladies and gentlemen, to the Q2, 2017 Gulf Island Fabrication, Inc. Earnings Conference Call.
Gulf Island Fabrication's (GIFI) CEO Kirk Meche on Q3 2016 Results - Earnings ...
Seeking Alpha - Oct 28, 2016
Good morning and welcome ladies and gentlemen to the Q3 2016 Gulf Island Fabrication Inc. Earnings Conference Call. All participants will be in a listen-only mode for the duration of today's conference.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for GIFI to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate GIFI's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$12.00 Current Price

$2.40 Growth Price (DCF)

Overvalued by 80.01%


Growth Rate Assumed by Market: 38.82%


Future Free Cash Flow Growth Rate: 0.0%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$2.13 Stability Price (EPV)

Overvalued by 82.27%


Discount Rate: 15.0%

$3.64 NCA Price

Overvalued by 69.71%


Varying Cash Return on Invested Capital over the past 5 years

GIFI has efficiently invested its financial resources in buildings, projects, and equipment, resulting in strong returns. However, there is a substantial variation in their Cash ROIC from year-to-year. This company may have unreliable free cash flow or operates in a business where invested capital costs increase substantially on a sporadic basis. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

GIFI has created $157.82 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow -24.85M 16.65M 4.45M 4.60M 7.56M
divided by
Invested Capital 12.83M 1.83M 3.30M -13.00M -27.14M
Cash ROIC -193.66% 910.83% 135.11% -35.35% -27.84%

Poor Return on Equity over the past 5 years

GIFI has shown an inability to deliver strong results for shareholders. This could be due to poor management, GIFI operating in a highly competitive industry, or having a weak business in general.

GIFI has only generated $- of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income - - - - -
divided by
Stockholders' Equity - - - - -
Return on Equity - - - - -

Mediocre Business Performance over the past 10 years

GIFI isn't a strong business and might be consistently attempting to fuel growth with debt or has trouble staying profitable. The lack of predictability in free cash flow should be concerning for the reliability of future earnings.

GIFI has been unable to consistently create value for shareholders.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow 17.94M -6.57M -4.26M 79.68M -29.61M -24.85M 16.65M 4.45M 4.60M 7.56M

Strong Balance Sheet

GIFI is financially strong with Current Assets covering Total Liabilities. It's in a fairly liquid position and dependent on the amount and saleability of any inventory; it may have the financial security to survive an economic downturn.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash 24.64M 13.84M 8.75M 88.07M 55.29M 24.89M 36.57M 36.09M 34.83M 51.17M
Current Assets 135.75M 136.38M 114.13M 130.62M 177.91M 173.60M 202.00M 172.50M 115.87M 113.36M
Total Assets 325.21M 350.89M 333.43M 334.86M 395.94M 403.50M 426.23M 397.94M 316.92M 322.41M
Current Liabilities 78.36M 74.94M 33.63M 18.51M 75.99M 92.27M 112.28M 72.77M 37.90M 35.35M
Total Liabilities 96.30M 96.68M 59.63M 47.66M 113.14M 130.00M 150.67M 112.15M 59.73M 59.38M
Stockholder' Equity 228.91M 254.21M 273.80M 287.19M - - - - - -
Current Ratio 1.73 1.82 3.39 7.06 2.34 1.88 1.80 2.37 3.06 3.21
TL-to-TA 0.30 0.28 0.18 0.14 0.29 0.32 0.35 0.28 0.19 0.18

Low or No Reinvestment of Profits over the past 10 years

GIFI has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to GIFI operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings 131.50M 154.79M 173.72M 186.23M 180.95M 171.03M 172.43M 181.88M 150.65M 153.58M
Retained Earnings Growth - 17.71% 12.23% 7.20% -2.84% -5.48% 0.81% 5.48% -17.17% 1.94%

Highly Competitive Industry over the past 10 years

It's likely that GIFI is in an industry with low barriers to entry, spurring high competition. If Gross Margins are at least satisfactory, it's likely GIFI invests heavily in R&D and Sales, General & Administrative expenses.

Only $2.54 of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 31.17M 29.02M 20.80M 13.09M - - - - - -
divided by
Revenue 472.74M 420.51M 311.53M 248.29M 307.83M 521.34M 608.33M 506.64M 306.12M 286.33M
Net Profit Margin 6.59% 6.90% 6.68% 5.27% - - - - - -

Weak Pricing Power over the past 10 years

GIFI is likely in a highly competitive industry, due to low barriers to entry. It's because of this, that GIFI has been unable to raise prices and increase their profitability. This puts them in a poor position if inflation becomes an issue, as they would struggle to pass higher costs onto consumers.

Only $16.36 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit 56.84M 52.30M 39.47M 23.27M 307.83M 3.84M 23.66M 44.56M -15.16M 24.85M
divided by
Revenue 472.74M 420.51M 311.53M 248.29M 307.83M 521.34M 608.33M 506.64M 306.12M 286.33M
Gross Margin 12.02% 12.44% 12.67% 9.37% 100.00% 0.74% 3.89% 8.79% -4.95% 8.68%

High Capital Intensity over the past 10 years

GIFI spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

116.19% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 46.91M 33.42M 15.25M 16.48M 41.55M 35.89M 21.35M 27.66M 6.02M 6.80M
divided by
Net Income 31.17M 29.02M 20.80M 13.09M - - - - - -
Capital Expenditure Ratio 150.50% 115.15% 73.30% 125.83% - - - - - -

Inconsistent Dividend History over the past 10 years

GIFI has started distributing dividends in the past couple years or has recently suspended their dividend distribution. The reliability of future distributions is unclear.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid - 5.74M - - - - - - - -
divided by
Shares Outstanding 14.30M 14.31M 14.30M 14.33M 14.35M 14.40M 14.47M 14.51M 14.55M 14.63M
Dividend Paid Per Share - 0.40 - - - - - - - -
Price at Year End 30.33 13.04 21.02 28.82 29.21 22.96 22.98 19.49 9.89 11.90
Dividend Yield - 3.07% - - - - - - - -

History of Stock Buybacks over the past 10 years

GIFI has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 14.30M 14.31M 14.30M 14.33M 14.35M 14.40M 14.47M 14.51M 14.55M 14.63M
Stock Bought Back - -0.07% 0.08% -0.24% -0.15% -0.34% -0.48% -0.25% -0.28% -0.58%
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