Jacobs Engineering Group Inc. (JEC - Free Report) has won a contract extension from the City and County of Denver for the redevelopment of its National Western Center campus.
Per the contract, Jacobs will help the City and County of Denver to refurbish 60 acres of the site cited as The Triangle project. The work will include improvement of the 1909 historic stadium building, along with the development of a new 10,000-seat arena and expo hall, structured parking, and a 42-acre site for real estate purpose. However, the terms of the deal are not yet disclosed by the company.
Jacobs has been assisting the program since 2016 with land acquisition, rail consolidation, site remediation along with connection facilities, a water resources center and river restoration plan. With this latest contract extension, it will continue to work as a program manager for the future phases of the program through its Buildings, Infrastructure and Advanced Facilities (BIAF) line of business.
Efficient project execution has been one of the main characteristics driving Jacobs’ performance over the last few quarters. This is evident from the company’s fiscal first-quarter 2019 backlog. Backlog (excluding discontinued business ECR) grew 8% year over year to $20.3 billion. Higher-margin Aerospace, Technology and Nuclear (ATN) and BIAF line of businesses continue to see a robust pipeline of government and infrastructure-spending programs.
Notably, the BIAF business (contributing 66.4% revenues in the fiscal first quarter) reported revenues of $2,048.8 million, increasing an impressive 90.9% year over year. Backlog in the segment also increased 7.4% from the prior-year quarter to $13.2 billion. The company projects three-year net organic revenues to witness a 3-5% CAGR, with BIAF leading the way with 4-6% top-line CAGR and ATEN with 2-3% CAGR.
Share Price Performance
Jacobs’ shares have outperformed its industry over the past three months. The company’s shares have gained 22.8% compared with 16.3% growth of its industry in the said period. Its price performance is backed by an impressive earnings surprise history, having surpassed the Zacks Consensus Estimates in six of the trailing seven quarters.
Zacks Rank & Other Stocks to Consider
Currently, Jacobs carries a Zacks Rank #2 (Buy).
Other top-ranked stocks in the Zacks Construction sector include Quanta Services, Inc. (PWR - Free Report) , Great Lakes Dredge & Dock Corporation (GLDD - Free Report) , and Altair Engineering Inc. (ALTR - Free Report) . While Quanta Services and Great Lakes sport a Zacks Rank #1 (Strong Buy), Altair carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Quanta Services, Great Lakes and Altair’s earnings for the current year are expected to increase 28%, 27.8% and 58.6%, respectively.
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