Shares of Granite Construction Incorporated (GVA - Snapshot Report) rose nearly 2% after the company announced on Mar 6 that it has been awarded a $36 million road and bridge project by the Alaska Department of Transportation. Construction work is scheduled to begin in Apr 2014 and the project is slated to be completed in late 2015.
The contract entails construction of a new East-West corridor by extending Dowling Road within the Anchorage city limits. Granite Construction is also required to build a new bridge over the Alaska Railroad lines and Arctic Avenue.
The project also includes improvement in soil stabilization, retaining walls, 800,000 tons of imported gravel borrow, 230,000 cubic yards of excavation and utility improvements. Granite Construction is also required to build two new signalized intersections, multi-use pathways and landscaping amenities. Granite Construction expects to book both the projects into backlog during the first quarter of 2014.
Last month, the company reported adjusted fourth-quarter 2013 earnings of 2 cents per share, surpassing the Zacks Consensus Estimate of a loss per share of 3 cents. Granite Construction’s net sales increased 18% year over year to $598 million but missed the Zacks Consensus Estimate of $623 million.
Total contract backlog increased to $2.5 billion as of Dec 31, 2013, compared with $1.7 billion as of Dec 31, 2012. The rise reflects the addition of the Tappan Zee Bridge project in New York, the IH-35E highway reconstruction project in Texas, I-40/440 project in North Carolina as well as an overall increase in the Construction segment backlog.
Granite Construction’s backlog, project funding and financing have improved. In addition, private constructions are showing signs of growth as well. In 2014, the company expects to bid on more than $13 billion of large projects. The company foresees an additional $20 billion in large projects beyond 2014.
Watsonville, Calif.-based Granite Construction is one of the major infrastructure contractors and construction material producers. The company’s project team is the best in the industry, serving the transportation, power, federal, tunneling, underground, and industrial, mining and water resources markets, which serve both public and private-sector clients.
Granite Construction currently has a short-term Zacks Rank #5 (Strong Sell).
Some better-ranked stocks in the same industry include CaesarStone Sdot-Yam Ltd. (CSTE - Snapshot Report), MasTec, Inc. (MTZ - Analyst Report) and Primoris Services Corporation (PRIM - Snapshot Report). While CaesarStone sports a Zacks Rank #1 (Strong Buy), MasTec and Primoris Services carry a Zacks Rank #2 (Buy).