Fluor (FLR) knows there's plenty of work to be done in the U.S.

Why is Fluor favored here? Even though oil & gas work demand is expected to decline in 2009, Fluor should benefit from infrastructure spending in President Obama's $787 billion fiscal stimulus package to help jump-start the U.S. economy.

Further, there's a rumor circulating that asserts that the U.S. government can't create jobs, but the last time several analysts checked, when the U.S. Congress says, "Build an aircraft carrier," lo and behold, in a few years an aircraft carrier appears! The same holds for civilian projects, and look for Fluor to snap-up some of these, although government project margins may not be as high as private-sector industrial and global services projects. The First Call F2009/F2010 EPS estimates for FLR are $3.58/$3.81.

Fluor's shares have paid the price of the recession, falling from the post-split $80-level to about $28, before recovering to the low $40s. The stock is making a strong case for having formed a bottom during the last five months and the p/e of 10 is reasonable.

Stock Analysis: Fluor is a moderate-risk stock. Fluor is an investment, not a trade. Consider buying a 25% position in FLR now; then buy another 25% in three months, if U.S. economic conditions don't worsen substantially. Under any circumstance, don't buy more than 50% of your FLR position in the first half of 2009. Sell/Stop Loss if you were to buy shares in this company: $23.


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Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.