GLDD Should I Buy
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Great Lakes Dredge & Dock Corp (GLDD) is not a good buy for a beginner, long-term investor at this moment. The stock is in the process of being acquired by Saltchuk Resources for $17 per share, which limits its upside potential. The price is already near the acquisition price, and the deal restricts further significant growth opportunities. Additionally, the overbought technical indicators and lack of strong trading signals further support a hold recommendation.
The stock's MACD is positive and expanding, indicating bullish momentum. However, the RSI is at 81.423, signaling overbought conditions. Moving averages are bullish (SMA_5 > SMA_20 > SMA_200), but the stock is trading close to its resistance levels (R1: 16.68, R2: 17.244), with limited room for further upside due to the acquisition.
The company is being acquired by Saltchuk Resources for $17 per share, representing a 25% premium over its recent stock price.
Strong financial performance in Q3 2025, with revenue, net income, EPS, and gross margin showing significant YoY growth.
JPMorgan's recent initiation of coverage with an Overweight rating and a $20 price target, citing a multi-year upcycle and strong backlog.
The acquisition limits the stock's upside potential to $17 per share, capping growth opportunities.
Investigations into potential fiduciary duty breaches regarding the acquisition could create uncertainty.
Overbought technical indicators (RSI above
suggest a potential pullback in the short term.
In Q3 2025, the company reported revenue growth of 2.11% YoY to $195.2M. Net income increased significantly by 100.23% YoY to $17.72M, with EPS doubling to $0.26. Gross margin improved to 22.42%, up 18.31% YoY, reflecting strong operational performance.
Analyst sentiment is mixed. JPMorgan initiated coverage with an Overweight rating and a $20 price target, citing a strong backlog and favorable market conditions. Noble Capital raised its price target to $17, maintaining an Outperform rating. However, Texas Capital downgraded the stock to Hold, reflecting the acquisition's limiting effect on upside potential.
