Fluor Corporation (FLR - Free Report) has secured a contract from Detroit-Windsor Bridge Authority, a Canadian government corporation. Per the contract, Bridging North America — partnership of Fluor and ACS Infrastructure Canada — will be responsible for designing, building, financing, operating and maintaining the Gordie Howe International Bridge project.
Early works are expected to start this summer while financial details will be released in September. Fluor will be booking its share of the contract value in the fourth quarter of 2018. This new bridge will be an important trade route between the United States and Canada.
“The Gordie Howe International Bridge will support economic growth by improving connections between Canada and the U.S., enabling the continuous flow of people and goods through a safe, secure and efficient Windsor-Detroit trade corridor,” said Canadian Infrastructure Minister Amarjeet Sohi.
On completion, the new bridge will be the longest cable-stayed bridge in North America. Also, as part of the contract, the companies need to build new, state-of-the-art ports of entry on both the U.S. and Canadian side of the Detroit River along with improving existing infrastructure in Michigan and Ontario.
Notably, this is not the first time that Fluor and ACS Infrastructure Canada are collaborating with each other. Earlier Fluor and ACS partnered for operating and maintaining the Rt. Hon. Herb Gray Parkway in Windsor.
Solid Record of Contract Wins
Fluor enjoys a solid track record of contracts, and management remains optimistic about the continuation of this trend in future, which is expected to drive growth for the company. Additionally, over the past few quarters, the major wins in the government business have allowed Fluor to expand its long-term recurring revenue opportunities.
This new contract is expected to substantially boost the top line. Notably, revenues at the Government segment soared 73.5% year over year to $1,327.2 million in the first quarter of 2018. The improvement was supported by the execution and substantial completion of task order awards for the U.S. Army Corps of Engineers in Puerto Rico. New awards in the quarter totaled $43 million.
Further, the long-term prospects of the company also remain strong with growth opportunities in renewable energy, gas-fired combined cycle generation and air emissions compliance projects for existing coal-fired power plants.
Notably, the Zacks Rank #3 (Hold) stock has returned 7.5% in the past year against the industry’s decline of 5.8%.
Stocks to Consider
A few better-ranked stocks in the same sector are Installed Building Products, Inc (IBP - Free Report) , PGT, Inc (PGTI - Free Report) and Aegion Corporation (AEGN - Free Report) . All three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank(Strong Buy) stocks here.
Installed Building Products, PGT and Aegion have long-term earnings growth rate of 30%, 19.3% and 12.5%, respectively.
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