Engineering firm, The Babcock & Wilcox Company has won U.S. Naval Reactors Program contract to render procurement and assembling services. Babcock & Wilcox will execute the deal, worth $366 million, through its affiliate Babcock & Wilcox Nuclear Operations Group Inc.
Per the deal, the company will procure the materials for the assembly of nuclear propulsion components at its Lynchburg, Va. Facility. Babcock & Wilcox has received $75 million as part payment and the remaining sum is likely to be funded in the next six fiscal years (2014–2019).
Earlier in February, Babcock & Wilcox also received two contracts worth $36 million, from U.S. Naval Reactors Program to render procurement and assembling services.
Headquartered in Charlotte, N.C., Babcock & Wilcox is engaged in providing clean energy technology and services for the nuclear, fossil and renewable power markets worldwide. The company – which was spun off as an independent and publicly traded entity from energy-focused engineering and construction firm McDermott International (MDR - Free Report) in Aug 2010 – operates in four business units: Power Generation, Nuclear Operations, Technical Services and Nuclear Energy.
Earlier this month, Babcock & Wilcox declared weaker-than-expected first quarter 2013 results due to lower operating income in some of its segments. Adjusted earnings per share came in at 46 cents, below the Zacks Consensus Estimate of 50 cents.
Babcock & Wilcox currently carries a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.
However, certain other engineering firms in the energy sector like Tri-Tech Holding Inc. and Graco Inc. (GGG - Free Report) are expected to outperform the equity market in the next one to three months. Both the stocks currently hold a Zacks Rank #1 (Strong Buy).