3Q2021 Results hit by stormy weather and COVID-19. Revenue was flattish with higher US Capital more than offsetting lower Coastal Protection. Maintenance and Rivers and Lakes were flat, while international remains dormant. Revenue hit from weather disruptions included an unexpected dry dock and COVID-19 cost drag was $2.1 million, but gross margin of $36.3 million and gross margin of 21.5% were positives. Same with EBITDA of $32.2 million and EBITDA margin of 19.1%.4Q2021 Guidance sets tone for strong finish to year. Revenue should jump into the $225-$235 million range with gross margin close to 3Q2021, implying gross profit in the $48 million range. COVID-19 cost drag is moderating and our EBITDA estimate is $42 million, or EBITDA margin of 18.8%. Looks like the strongest quarter in almost two years, and full year EBITDA estimate is $121.6 million based on EBITDA margin of 16.4%.Recovery expected next year. With higher backlog and moderating COVID-19 costs, we estimate that 2022 EBITDA to recover to $147.8 million. Ellis Island will dry dock in mid-year and revenue expected to be flat, but profitability should improve, with gross margin in the 21.6% range and EBITDA margin of close to 20%.Backlog moved up $155 million to $599 million and low bids/options pending award remains high at $534 million. 4Q2021 bidding off to good start and more optimistic on LNG potential. Recent awards include South Atlantic Regional Harbor for $25.8 million (ex options of $3.6 million) and Oak Island Renourishment Project 2021/2022 of $17.1 million. Once terms are finalized, the Port Houston pending award of up to $95.4 million will add to 4Q2021 backlog with second phase on the horizon.Maintain Outperform rating and price target of $17.05/share due to new awards, fleet renewal program and disciplined capital allocation. While the stock is up 14% this year, softer 2Q2021 results have dampened stock price performance over the past three months and the stock is off 1% in 4Q2021. We think the 2Q2021 results shortfall should be transitory, and the risk/reward profile remains favorable. Trading at an EV multiples of 9.2x 2021E EBITDA and 8.1x 2022E EBITDA, the stock looks attractive due to solid 4Q2021 guidance, recent awards and successful 2Q2021 debt refinancing. Read More >>