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KBR's Government Solutions Unit Wins $128M NOAA Contract

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KBR, Inc. (KBR - Free Report) has won a $128-million contract from the National Oceanic and Atmospheric Administration (NOAA) National Weather Service (NWS). KBR will deliver key weather-related data services through the National Mesonet Program — a central clearinghouse for non-federal weather data.

Per the contract, KBR — together with its partners — will provide local weather information from more than 50,000 surface-based, mobile and aircraft-based weather observation platforms across the globe.

KBR will carry out this work with Synoptic Data PBC, Earth Networks, WeatherFlow and the University of Oklahoma through the next five years. Notably, this firm-fixed-price contract was earlier won by KBR in 2017.

Notably, data provided by KBR’s Government Solutions business will help NWS in improving National Weather Service warning and forecast operations.

Over the past 30 years, KBR has been serving various government agencies like NOAA, U.S. Geological Survey and NASA.

Government Solutions Business: A Boon for KBR

The company’s Government Solutions business — which contributed 69.6% to 2019 revenues — has been serving the U.S. Air Force, Army, Navy, Marine Corps, and other federal agencies and foreign allies over the past several years.

Sales from the Government Solutions business recorded 14% growth in 2019, 9% of which was organic. Its continued industry-leading organic revenue improvement was underpinned by on-contract growth in logistics and engineering, take-away wins, alongside new work awarded under the company’s portfolio of well-positioned contracting vehicles.

Owing to solid performance across businesses, shares of KBR have outperformed the Zacks Engineering - R And D Services industry in a year’s time. Notably, the company is banking on strength of the Government Solutions business to optimize growth potential. Also, steady growth in backlog is adding to KBR’s bliss. The company’s solid backlog level of $14.64 billion (as of Dec 31, 2019) compared with $13.5 billion at 2018-end highlights its underlying strength.

Zacks Rank

KBR — which shares space with Gates Industrial Corporation plc (GTES - Free Report) , Quanta Services, Inc. (PWR - Free Report) and AECOM (ACM - Free Report) in the same industry — currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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