Tetra Tech Secures Forest Management Deal From USAID In Peru

Tetra Tech, Inc. (NASDAQ:TTEK) recently clinched a $23-million single-award contract from the U.S. Agency for International Development (“USAID”). Per the five-year USAID PRO-BOSQUES contract, Tetra Tech will support USAID’s work in improving forest management in Peru, apart from promoting private sector engagement in the sector.

Notably, Tetra Tech will be responsible for providing technical services for the development and implementation of monitoring tools like electronic timber tracking system. This will help in tracking the movement of timber throughout the value chain, which will eventually allow prevention of illegal logging practices and forest degradation.

The company will also work on promoting the private sector participation in the country’s forest sector through enhanced business practices apart from encouraging the involvement of forest-dependent communities. Notably, the company’s support services will help in restoring Peru’s forest biodiversity.

Existing Business Scenario

Tetra Tech is bullish about its growth prospects across all four client sectors, namely, U.S. federal, U.S. state and local, the U.S. commercial work and finally international. Based on the growth rate forecast for both the U.S. federal and the U.S. state local markets, the company expects federal work to comprise almost a third of its business, while work for U.S. state and local clients is expected to grow 5%. Such positive industry trends are likely to act as catalysts for the company’s over the long run.

Moreover, 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.

On a year-to-date basis, this Zacks Rank #3 (Hold) company has returned 13.8%, significantly outperforming the industry’s growth of 2.9%.

However, fluctuations in mining and energy markets as well as escalating costs are a major cause of concern for Tetra Tech.

Key Picks

Some better-ranked stocks from the same space are DXP Enterprises, Inc. (NASDAQ:DXPE) , Harsco Corporation (NYSE:HSC) and Enersys (NYSE:ENS) . While DXP Enterprises and Harsco sport a Zacks Rank #1 (Strong Buy), Enersys carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

DXP Enterprises exceeded estimates thrice in the preceding four quarters, the average positive earnings surprise being 112.62%.

Harsco outpaced estimates in each of the preceding four quarters, the average earnings surprise being 13.58%.

Enersys surpassed estimates thrice in the trailing four quarters, the average positive earnings surprise being 2.83%.

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