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AECOM (ACM) Wins New Jersey Turnpike Authority Contract

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AECOM (ACM - Free Report) has secured the New Jersey Turnpike Authority’s $1.1-billion Interchange 1 to 4 Widening Program contract. Per the deal, AECOM will offer program management, and preliminary engineering as well as environmental services for the project’s permitting, design, and construction phases.

AECOM’s U.S. East region’s chief executive, Dan Faust, said, "Acting as an extension of the Authority, we intend to manage the program efficiently and transparently, utilizing our vast global resources and innovative tools to achieve the Authority’s vision."

Project Details

The New Jersey Turnpike is a critical component of economic vitality and environmental sustainability. The program will extend mainline capacity and expand interchange operations over a 36.5 mile stretch of the New Jersey Turnpike. This will therefore reduce congestion and improve environmental conditions throughout the corridor.

This apart, the program will allow the Authority to make further improvements like replacing overhead structures, upgrading signage, enhancing highway safety, updating data collection, and advancing stormwater management practices in accordance with new infrastructure requirements.

As a program management consultant, AECOM — with the help of its leading technical experts — will facilitate timely delivery; coordination and communication with stakeholders; conceptual and preliminary design; and environmental services to help the Authority meet current and future demand.

AECOM will play a vital role in delivering the largest capital program in the New Jersey Turnpike Authority’s history, thereby supporting its mission of providing the highest quality of life for New Jerseyans.

Solid Backlog Level & Americas Segment to Aid

AECOM is witnessing a robust pipeline of pursuits across the business. The company’s net service revenues or NSR — defined as revenues excluding subcontractor and other direct costs — have been benefiting from strength across core transportation, water and environment markets. Although backlog of $39.4 billion at fiscal second quarter-end was down 5% due to tepid performance of the Construction Management business, the design business was strong (up 8% year over year).

AECOM currently has a good visibility into growth and strong backlog in the pipeline for the upcoming quarters. Its shares have gained 28.2% in the year-to-date period, almost in line with the industry’s 27.3% growth. Also, earnings estimates for fiscal 2021 have moved up 1.9% over the past 60 days, depicting analysts' optimism over bottom-line growth potential. The Zacks Consensus Estimate for the Zacks Rank #3 (Hold) company’s fiscal 2021 earnings indicates a 27% increase from 2020. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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AECOM — which shares space with KBR, Inc. (KBR - Free Report) , Jacobs Engineering Group Inc. (J - Free Report) and Quanta Services Inc. (PWR - Free Report) in the Zacks Engineering - R and D Services industry — is a leading solutions provider for supporting professional, technical and management solutions for diverse industries across end markets. Most of the U.S. government’s broad infrastructural plan is focused on the transit and water markets, wherein AECOM enjoys a dominant position. Notably, the Americas business is the highest contributing segment and is likely to benefit from President Joe Biden’s recent $1-trillion infrastructure deal.

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