KBR Inc. (KBR - Free Report) has clinched a task order from the U.S. Air Force Civil Engineer Center to provide support to the 378 Air Expeditionary Wing and U.S allies at the Prince Sultan Air Base in Saudi Arabia.
Per the latest contract, valued at $93.6 million, it will provide resources to support the base and ensure quality of life for the 378th Air Expeditionary Wing and partner forces. For this, KBR will supply all personnel, supervision, labor, training, vehicles, tools, safety equipment and other force support services.
Byron Bright, KBR Government Solutions’ president, said, "With this win, KBR continues to expand its support for the Air Force and will enable the 378th Air Expeditionary Wing to stay focused on its mission."
It won this five-year task order from the U.S. Air Force through the Air Force Contract Augmentation Program V (AFCAP V). Notably, the company secured a seat on the $6.4-billion contract earlier this year. It has also been providing critical services under AFCAP III and IV since 2005 that include recovery efforts at the Tyndall Air Force Base after Hurricane Michael in 2018.
Focus on Government Solutions to Propel Growth
KBR has a diversified business portfolio, which helps it combat cyclicality associated with any single market. Presently, the company has been banking on strength of the Government Solutions and Technology Solutions segments to optimize growth potential.
Currently, KBR is banking on the Government Solutions business strength to optimize growth potential. The performance of the said business is exceeding market expectation, which is adding to KBR’s bliss.
The latest contract with the U.S. Air Force reflects KBR’s ability to cash in on big government projects for driving revenues. As of Jun 30, 2020, total backlog came in at $12.59 billion compared with $14.64 billion at 2019-end. Of the total backlog, Government Solutions booked $10.52 billion.
Share Price Performance and Zacks Rank
Shares of KBR have gained 47.8%, comfortably outperforming the industry’s 17.4% rally in the past six months. Its uptick in price movement can primarily be attributable to the ongoing contract wins, acquisitions and robust organic growth.
KBR — which shares space with Gates Industrial Corporation plc (GTES - Free Report) , Quanta Services, Inc. (PWR - Free Report) and AECOM (ACM - Free Report) in the same industry — currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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