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KBR Secures $229M Army Contract to Boost Helicopter Readiness

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KBR, Inc. (KBR - Free Report) has secured a $229 million recompete task order under the Department of Defense Information Analysis Center’s multiple-award contract. This five-year contract will focus on research and analysis to improve the U.S. Army’s CH-47 Chinook helicopter systems. The project will be executed in Huntsville, AL, reinforcing KBR’s long-standing expertise in military aviation support.

KBR shares gained 0.8% during the trading session yesterday.

KBR’s Role in Enhancing Military Readiness

Under this agreement, KBR will provide critical life cycle research, assessment, and recommendations to enhance the availability, reliability, and cost-efficiency of the CH-47 Chinook. This iconic helicopter serves as a vital asset for troop and cargo transport, medical evacuations, and combat missions.

The company will work on improving maintainability and sustainability while analyzing quality and supportability. It will also focus on developing interoperability strategies and managing logistics, as well as testing programs. Additionally, cost and life cycle evaluations will be conducted to ensure long-term efficiency. By optimizing these areas, KBR will help the Army and its Foreign Military Sales partners extend the operational effectiveness of their helicopter fleets.

Strengthening KBR’s Market Position

This contract win underscores KBR’s leadership in defense technology and logistics. As a 10-year incumbent on predecessor contracts for the CH-47, KBR has a deep understanding of the helicopter’s operational challenges and solutions. The company’s 35-year partnership with the U.S. Army’s Aviation Program Executive Office further cements its credibility in delivering high-value defense solutions.

KBR president and CEO Stuart Bradie emphasized the company’s commitment to national security, stating, “This is a significant win for KBR. Our subject matter experts play a crucial role in supporting the U.S. military and its mission.”

KBR Stock Performance

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KBR’s shares have lost 11.8% year to date compared with the Zacks Engineering - R and D Services industry’s 15.2% decline. Although high costs and expenses are posing concerns, its focus on high-end and differentiated government business work, strong margin performance, and technology and consulting businesses bodes well. This latest contract strengthens KBR’s position as a key player in the defense sector, ensuring a steady revenue stream while reinforcing its reputation for excellence in military aviation support. With a strong pipeline of government contracts and a focus on technological advancements, KBR continues to be a solid investment choice for long-term growth.

As of Jan. 3, 2025, the total backlog (including award options) was $21.2 billion compared with $21.73 billion at 2023-end. Of the total backlog, Government Solutions contributed $13.55 billion, and the Sustainable Technology Solutions segment contributed $3.71 billion. At the end of 2024, the company delivered a trailing 12-month book-to-bill of 1.1x.

Earnings estimates for 2025 have increased to $3.84 per share from $3.83 over the past 30 days. The estimated figure indicates 15% growth from 2024.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

KBR Stock’s Zacks Rank & Key Picks

KBR currently carries a Zacks Rank #3 (Hold).

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