Fluor Corporation FLR
Fluor's $4bn NuScale stake masks a transformed EPCM core trading at just 2.8x EBITDA; separating NuScale unlocks a re-rating to peer 6-13x multiples.
Thesis
Starboard argues that Fluor, a global engineering, procurement and construction firm with $6bn enterprise value and a $28bn backlog, is meaningfully undervalued because its 39% stake in NuScale (worth ~$4bn post-tax) masks a transformed core EPCM business trading at just 2.8x CY27E EBITDA. Under CEO David Constable, hired in 2021, Fluor has shifted from risky lump-sum work (55% of backlog in FY20) to 80% reimbursable contracts, resolved most legacy loss-making projects, and grown adjusted EBITDA from $358mm in FY21 to a projected $751mm by FY28. With most EPCM peers having exited construction (AECOM, Jacobs, KBR) and U.S. reindustrialization tailwinds accelerating, Fluor should trade in line with peers at 6-13x. Starboard urges Fluor to separate the NuScale stake — via taxable monetization funding buybacks or a tax-free spin-off — to unlock substantial re-rating value.
SCQA
Fluor is one of the few remaining full-service global EPCM firms, with $6bn enterprise value and a $28bn backlog spanning urban infrastructure, energy, and government end markets after most peers exited construction.
Fluor appears fairly valued at 8.9x EBITDA, but its $4bn NuScale stake hides that the transformed core EPCM business trades at just 2.8x — well below the 6.0x construction and 13.0x EPCM peer medians.
Separate the 39% NuScale stake — via taxable monetization (open-market sales, exchange offer, mandatory exchangeable) funding share buybacks, or a tax-free spin-off — decoupling the stub from optionality.
A separation could re-rate Fluor's core EPCM business from 2.8x toward the 6.0x construction or 13.0x EPCM peer EBITDA medians, unlocking significant shareholder value and EPS accretion via buybacks.
The three reasons
- 1
Excluding its $4bn NuScale stake, Fluor's core EPCM business trades at just 2.8x CY27E EBITDA
- 2
CEO David Constable transformed Fluor since 2021: 80% reimbursable backlog, EBITDA up from $358mm to projected $751mm
- 3
Separating NuScale via spin-off or monetization unlocks a re-rating to 6-13x peer multiples
Primary demands
- Separate Fluor's 39% NuScale stake from the core EPCM business
- Pursue either a taxable monetization (open-market sales, exchange offer, or mandatory exchangeable bond) funding meaningful share repurchases, or a tax-free spin-off
- Allow the core EPCM business to re-rate toward construction (6.0x) or EPCM (13.0x) peer EBITDA multiples
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Precedents cited
- Starboard's AECOM transformation (2019-2025): board refresh, new CEO Troy Rudd, exit of self-perform construction
Notable slides (5)
Notes
Starboard's contrarian framing is largely supportive of incumbent management (David Constable, Jim Breuer) — the 'villain' is the prior 2010s leadership and the market's failure to credit the transformation. Starboard does not disclose its own ownership stake in Fluor in this deck. Cover says 'October 2025'; market data 'as of October 17, 2025' — exact day of presentation not stated, so presentation_date left null. Filename '2025-02-2025' appears to be a malformed date string from the source. Sum-of-parts arithmetic on slide 24 (8.9x → 2.8x by stripping NuScale) is the deck's core rhetorical move. CEO quote on slide 32 highlights investor disappointment with management's own NuScale monetization plan as the wedge for Starboard's preferred path.