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Jacobs (J) Set to Serve Auckland's Eastern Busway Project

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Jacobs Engineering Group Inc. (J - Free Report) has inked a contract from Auckland Transport, New Zealand, to design, consent and construct three stages — 2, 3 and 4 — of the Eastern Busway project. The contract is valued at $455 million.

This contract — expected to be completed by 2025 — is part of the Eastern Busway Alliance that also includes companies like Fletcher Construction, Acciona Construction and AECOM (ACM - Free Report) .

The consortium will work on these three stages of the project that will deliver approximately 5 km of rapid-transit busway, and comprise the final parts of a new 7 km connection between Botany and Panmure Stations. With this, Eastern Busway will be able to carry 30,000 passengers daily, and cut down daily traveling time between Botany and Auckland City.

In this regard, Jacobs People & Places Solutions (P&PS) executive vice president Patrick Hill said, “By collaborating with Auckland Transport and our Alliance partners to deliver a more efficient transit system for Auckland commuters, we are helping to create lasting social and economic benefits for the region."

Continuous Contract Wins to Aid Backlog

This Zacks Rank #2 (Buy) company has been on a contract wining spree of late. Last month, Jacobs received a contract from National Industrial Corridor Development Corporation Limited to develop smart city masterplans for three greenfield industrial developments in South India. In the same month, Jacobs secured a new Architecture and Engineering contract to support the U.S. Air Force B-21 program. The contract has a base period of five years and an optional period of two years.

Moreover, it nabbed two contracts in June from KiwiRail, New Zealand's rail network owner and operator, ahead of the opening of Auckland's largest ever transport infrastructure project, the City Rail Link. Jacobs is set to modernize Auckland's rail network as part of KiwiRail's Auckland Metro Rail Programme.

Its ongoing contract wins has been a boon for the company, as is evident from the solid backlog level. For the fiscal second quarter, its backlog of $15.5 billion was up 9.6% year over year. This reflects persistent solid demand for the company’s consulting services.

Zacks Investment ResearchImage Source: Zacks Investment Research

Shares of Jacobs have advanced 22.6% year to date, almost in line with the Zacks Engineering - R and D Services industry’s 22.5% rally. Earnings estimates for the current fiscal year have increased 5.2% over the past 30 days to $6.12 per share, indicating 11.7% year-over-year growth. This ensures impressive growth visibility. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Key Picks

Other top-ranked stocks in the same space include Gates Industrial Corporation PLC (GTES - Free Report) and Howmet Aerospace Inc. (HWM - Free Report) , each carrying a Zacks Rank #2.

Earnings for Gates Industrial and Howmet Aerospace are expected to grow 82.9% and 22.5% for the current year, respectively.

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