Macro Enterprises

Macro Enterprises

MCR

Last Updated On: October 12, 2018

Share Price On This Date: $3.35

Pipeline construction services to the oil and gas industry.

Summary

Macro Enterprises is a feast or famine type of company. During the periodic industry busts, they tend to lose money, but during the boom times, they can make out like bandits. The last cycle saw EPS get as high as 85 c at one point. Right now, they are in the trough of their cycle. The company offers pipeline construction services to companies in the Canadian oil and gas sector. Canada is desperately in need of more pipelines. Canadian crude has been selling at a deep discount to the US version because there is no good way to get this crude to market. Shipping it out by train doesn't really cut it anymore with the vast quantities of cheap shale oil that the US is pumping out of the ground. Macro has signed a very large contract to work on the Trans Mountain pipeline out to the west coast but the future of this project is uncertain as construction has been delayed by environmental concerns. The Canadian government has taken ownership of this project but it still faces fierce opposition. Environmentalists are fighting tooth and nail to prevent any new pipelines from being built and they may well emerge victorious. However, Macro recently got some very good news as LNG Canada announced they were moving ahead with their proposed new LNG plant on Canada's west coast. Macro has a large contract to build a pipeline from Northern BC to supply this plant and this should keep the money rolling in well into 2019. Beyond that, a thriving LNG plant could drive a renewed spurt of activity in Canada's gas patch that could mean more business for Macro down the road.

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