Tetra Tech, Inc. (TTEK - Free Report) recently announced that the company has secured a $60-million multiple-award contract from the U.S. Army Corps of Engineers, Portland District. Per the five-year contract, Tetra Tech will provide engineering and design services throughout the Pacific Northwest.
Notably, the Portland District helps in balancing the area’s competing requirements for hydropower, navigation, flood risk management, fish and wildlife habitat, and irrigation as well as recreation. Per the deal, Tetra Tech will be responsible for providing technical services that include geotechnical analyses and site investigations as well as engineering design. This will support water-related civil works projects, which will eventually help in managing navigation, improving coastal structures and maintaining water supplies as well as reducing flood-related risks.
Moreover, the company’s engineers and biologists will help in minimizing the negative impacts on fish habitat by designing systems like fish passage alternatives. Notably, the company’s planning, permitting and design support services will help in restoring the watershed’s ecosystem habitat.
Existing Business Scenario
Tetra Tech has had a solid run in recent times, owing to its impressive top-line growth, restructuring efforts and accretive acquisitions. In a bid to maximize growth prospects, Tetra Tech is currently focusing on high-end consulting and engineering services, which are helping the company to promote its high-value and high-margin business, thus, differentiating it from the peers in the marketplace. Meanwhile, in the past six months, this Zacks Rank #2 (Buy) company has returned 19.3%, significantly outperforming the industry’s increase of 1.1%.
Moreover, the company remains optimistic about its growth prospects across all four client sectors, namely, U.S. federal, U.S. state and local and U.S. commercial work along with international. Based on growth rate forecast for both the U.S. federal and the U.S. state local markets, the company expects federal work to comprise almost a third of its business and grow at a rate of 5-10% for the rest of fiscal 2018, while work for U.S. state and local clients is expected to grow 10-15%. Such positive industry trends are likely to act as catalysts for the company’s growth in the long run.
Further, the company believes that the solid pipeline of projects in the Department of Defense and development-related services in the U.S. will continue to propel growth of its federal business. In addition, sound financial health and diligent capital-deployment strategies have also been supplementing the company’s growth momentum.
Other Stocks to Consider
Other top-ranked stocks from the same space include Harsco Corporation (HSC - Free Report) , Graco Inc. (GGG - Free Report) and Welbilt, Inc. (WBT - Free Report) . While Harsco sports a Zacks Rank #1 (Strong Buy), Graco and Welbilt carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Harsco has surpassed estimates in the trailing four quarters, with an average positive earnings surprise of 24.44%.
Graco has outpaced estimates thrice in the preceding four quarters, with an average earnings surprise of 12.81%.
Welbilt has surpassed estimates thrice in the trailing four quarters, with an average positive earnings surprise of 14.60%.
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