Tetra Tech (TTEK) Secures $85M Single-Award Deal From DFID

Tetra Tech, Inc. (NASDAQ:TTEK) recently announced that it has clinched a $85-million contract from the U.K. Department for International Development (“DFID”). Per the single-award deal, the company will support DFID’s Powering Economic Growth in Northern Nigeria (LINKS) program.

Designed to support sustainable economic growth and improve standard of living for the people of Nigeria, DFID’s seven-year LINKS program will help in increasing income of 3 million people, apart from supporting 100,000 full-time equivalent job creation. Per the deal, Tetra Tech will aid DFID to recognize and support potential markets in Nigeria, which include waste management, renewable and off-grid energy solutions, as well as agricultural sector’s information and communications technology applications.

Tetra Tech will be responsible for collecting data, performing advanced analytics and conducting geospatial mapping during the project’s lifespan. Also, the company’s researchers will work on assessing new business models and technology that would help in boosting economic performance and cut transaction-related costs. Moreover, the deal will involve the company’s monitoring and evaluation experts to examine data and provide market intelligence to the private sector and project beneficiaries.

Existing Business Scenario

Tetra Tech’s top line has gained significantly from its multiple government contract wins in the recent years. At the end of third quarter of fiscal 2019 (ended Jun 30, 2019), total backlog from ongoing operations – which is the best indicator of future revenue streams – grew 16.4% year over year to a record level of $2,834 million.

For the rest of fiscal 2019 (ending September 2019), the company anticipates that the U.S. state and local business will benefit from growth in disaster response and recovery planning as well as the broad-based infrastructure business. International revenues are predicted to increase for the rest of the year while modest rise is expected from U.S. federal customers. For fiscal 2019, the company anticipates net revenues of $2.37-$2.41 billion compared with the previously estimated $2.3-$2.4 billion.

In the past six months, the company's shares have recorded an impressive rally of 36.9%, outperforming the industry’s growth of 8.3%.

Zacks Rank & Other Key Picks

Tetra Tech currently carries a Zacks Rank #2 (Buy). Some other top-ranked stocks from the Zacks Industrial Products sector are Cimpress N.V. (NASDAQ:CMPR) , Casella Waste Systems, Inc. (NASDAQ:CWST) and Sharps Compliance Corp. (NASDAQ:SMED) . While Cimpress sports a Zacks Rank #1 (Strong Buy), Casella Waste Systems and Sharps Compliance carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cimpress’ earnings surprise in the last reported quarter was 137.04%.

Casella Waste Systems’ earnings surprise in the last reported quarter was 8.00%.

Sharps Compliance’s earnings surprise in the last reported quarter was 200.00%.

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