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Tetra Tech Wins $46 Million Single-Award Contract From TAM

Zacks Equity Research

Tetra Tech, Inc. TTEK recently announced that it has clinched a $46-million single-award contract from the U.S. Army Corps of Engineers, Transatlantic Middle East District (TAM). The five-year deal will involve Tetra Tech to offer engineering design services that would support the U.S. Central Command and TAM missions throughout the world.

Tetra Tech will be responsible for providing technical design services to existing, new facilities and infrastructure improvement projects. The company’s architects and engineers will dispense support services in every phase of the project life cycle. These phases include planning and program development through final design and engineering services during the course of construction.

Notably, this contract vehicle has involved Tetra Tech to deliver architect-engineer services to the U.S. Army Corps of Engineers, Middle East District for the past decade. As a matter of fact, the latest deal will further enhance the company’s long-standing partnership with the U.S. military.

Existing Business Scenario

Tetra Tech is bullish about its growth potential across all four client sectors, namely, U.S. federal, U.S. state and local, U.S. commercial and finally, the international. Based on the growth rate forecast for the U.S. federal markets, the company expects sales from these markets to rise at 5% rate for fiscal 2019 (ending September 2019).

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

In the past three months, shares of the company have surged 33.6% compared with the industry’s increase of 6.1%.

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

Zacks Rank & Other Stocks to Consider

Tetra Tech currently carries a Zacks Rank #2 (Buy). Some other top-ranked stocks from the Zacks Industrial Products sector are CECO Environmental Corporation CECE, Energy Recovery, Inc. ERII and Brady Corporation BRC. While CECO Environmental and Energy Recovery currently sport a Zacks Rank #1 (Strong Buy), Brady carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

CECO Environmental delivered average positive surprise of 25.00% in the trailing four quarters.

Energy Recovery pulled off average positive surprise of 225.00% in the last four quarters.

Brady came up with average beat of 9.22% in the preceding four quarters.

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