Back to top

Image: Bigstock

Tetra Tech (TTEK) Benefits from Solid Footing in Key Markets

Read MoreHide Full Article

On Jun 4, we issued an updated research report on Tetra Tech, Inc. (TTEK - Free Report) .

In the past three months, this Zacks Rank #2 (Buy) stock has gained 16.4% compared with the industry’s increase of 3.7%.

                 

Existing Scenario

Tetra Tech remains bullish about its growth prospects across all four client sectors, namely, U.S. federal, U.S. state and local, the U.S. commercial and international. The company expects sales from these markets to grow at a rate of 5% for fiscal 2019 (ending September 2019). Sales from U.S. state and local clients are expected to jump 15%, supported by strong growth in municipal water infrastructure and disaster response recovery services. U.S. commercial sales are expected to rise around 5% with continued increase in sustainable building designs and environmental services.

Also, in a bid to maximize growth prospects, the company is currently focusing on high-end consulting and engineering services that is helping it promote its high value and high margin business, thus differentiating it from peers.

Moreover, Tetra Tech expects that solid opportunities across the globe will boost its international revenues. For fiscal 2019, the company expects a 10% growth rate in its international clients, particularly in Canada and Asia Pacific region. In addition, infrastructure and industrial work in Canada, and commercial and environmental programs in the United States are likely to supplement the company’s top line.

In addition, the acquisition of eGlobalTech (closed in March 2019) is predicted to solidify its business from government and commercial customers. Further, over the past few quarters, the company has consistently returned significant cash to shareholders through dividends and share repurchases. It’s worth noting here that Tetra Tech announced a 25% hike in quarterly dividend rate in April 2019. Such diligent capital deployment strategies boost shareholders' wealth.

Other Key Picks

Some other top-ranked stocks from Zacks Industrial Products sector are Roper Technologies, Inc. (ROP - Free Report) , Dover Corp. (DOV - Free Report) and DXP Enterprises, Inc. (DXPE - Free Report) . While Roper sports a Zacks Rank #1 (Strong Buy), Dover and DXP Enterprises carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Roper delivered average earnings surprise of 8.43% in the trailing four reported quarters.

Dover pulled off average positive earnings surprise of 8.61% in the previous four reported quarters.

DXP Enterprises delivered average earnings surprise of 48.47% in the trailing four reported quarters.

Today's Best Stocks from Zacks

Would you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1% and +98.3%.

This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.

See their latest picks free >>