Reported 1Q2021 EBITDA of $9.6 million was in line with expectations due to asset sales of $1.6 million. Versus 1Q2020, revenue of $153.3 million was $13 million lower, gross profit of $15.5 million was $5.3 million lower and EBITDA of $2.6 million of $9.6 million was $2.6 million lower. Profitability was solid, albeit at lower levels with gross margin of 10.1% (-180 basis points) and EBITDA margin of 6.2% (-110 basis points). Severe weather in Texas disrupted operations for ten days and hit revenue by >$8 million, but concrete results rebounded and offset lower Marine results.Call with management today at 10am EST. Number is (201) 493-6739 and code is Orion Group Holdings. Looking for color on Marine outlook/backlog, Concrete outlook/backlog, ERP implementation, and timing of asset sales. Zoning approval to clear Tampa yard sale appears likely at a May 6th meeting and capital allocation priorities will be highlighted.Backlog down, but low bids pending award up. 1Q2021 backlog of $365 million dropped from $440 million in 4Q2020 due to lower backlog of $155 million (down $48 million) and lower Concrete backlog of $210 million (down $27 million). One bright spot was low bids pending award increase of $38 million to $134 million, but potential backlog dropped $37 million to $499 million from $536 million in 4Q2020. Industry fundamentals remain positive despite state level concerns about COVID-19 and bid outstanding total $1.9 billion.Maintaining 2021 EBITDA estimate of $47.0 million, including asset sales of $1.6 million. Tough comps versus reported 2020 EBITDA, but profitability remains solid with EBITDA margin in 6.8% range. Marine results should pick up over rest of year and Concrete results represent upside potential.Maintain Outperform and price target of $8.25/share due to compelling risk/reward profile. While the stock is up 17% this year, we believe that the current stock price doesn't fairly reflect the structural improvement in execution and profitability triggered by the ISG restructuring. A combination of firming backlog, improving profitability, declining financial leverage and attractive valuation (4.6x 2021E EBITDA) supports our view that the risk/reward profile remains compelling. Potential catalysts include added awards, infrastructure focused legislation and upcoming asset sales in 2Q2021. Read More >>