Close on the heels of a $50 million contract from the U.S. Navy, technical services provider Tetra Tech, Inc. TTEK won another contract from the U.S. Agency for International Development (USAID). The USAID single-award contract spans five years and is worth $20 million. Under the contract, Tetra Tech will develop accountability and transparency of important government institutions in El Salvador.
Tetra Tech will take measures to improve citizen participation and oversight, and spread awareness of government reforms by enhancing the capability of civil society to monitor public resources. To implement these initiatives and build up professional standards and accountability at the national and municipal levels, Tetra Tech will employ inventive approaches such as information technology tools and social media.
Tetra Tech will work hand-in-hand with the Government of El Salvador, thus supporting USAID and delivering key services to the citizens of El Salvador.
Earlier this week, Tetra Tech’s joint venture with Michael Baker International won a “single-award, indefinite delivery contract” worth $50 million from the U.S. Navy. The five year contract serves to strengthen Tetra Tech’s half a century old relationship with the Navy.
The latest contract highlights Tetra Tech’s capability of gaining significant contracts from the federal government. As a matter of fact, Tetra Tech’s backlog level for ongoing operations grew 5% year over year in the first quarter of fiscal 2016, driven by noteworthy contract wins from federal (especially from USAID), commercial and municipal clients.
We believe the company’s solid backlog levels, coupled with a robust pipeline of billion-dollar awards from major government organizations like U.S. Department of State, U.S. Army Corp. of Engineers and U.S. Air force will supplement its financials, going forward. Further, the company’s concerted efforts to strengthen its position in the U.S. commercial, international, state and local businesses also bode well.
However, adverse currency translation impact, softness in the mining business and volatility in oil & gas prices continue to weigh on this Zacks Rank #4 (Sell) stock’s overall financials.
Some better-ranked stocks in the broader sector include Landauer Inc. LDR, Global Brass and Copper Holdings, Inc. BRSS and Norsk Hydro ASA NHYDY, each carrying a Zacks Rank #2 (Buy).
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