Tetra Tech Inc.
) acquired a Colorado-based oil and gas pipeline planning and
engineering firm, Rooney Engineering Inc. (REI). This acquisition
extend Tetra Tech's services to the shale oil market. Shale oil is
a crude oil that is obtained from oil shale by heating and
Currently, REI's main region of work is Bakken and Niobrara
shale oil regions. It has also worked on projects across the U.S.,
including Alaska and the Gulf Coast. Annually, REI generates
approximately $30 million in revenue. The terms of the acquisition
are not yet disclosed.
Tetra Tech is an expert in water resources and front-end
environmental permitting for oil and gas projects. The addition of
pipeline planning and engineering through REI is a strategic fit
for Tetra Tech. The combination allows Tetra Tech to provide a
complete range of services to the rapidly growing shale oil
The company is also performing well in its international market,
benefitting from rising demand for water-related services.
Favorable returns from the domestic as well as international
markets led the company to increase its revenue guidance for fiscal
However, impact of a weak economic condition remains a matter of
concern. A major portion of Tetra Tech's revenue is derived
from the U.S. federal government agencies; as such, any delay in
budgets would have a material impact on revenue.
Tetra Tech Inc. is a leading provider of consulting,
engineering, program management, construction and technical
services focusing on resource management and infrastructure. It
serves clients by providing cost-effective and innovative solutions
to fundamental needs like water, environmental and alternative
We currently maintain our Neutral rating on Tetra Tech Inc. with
a Zacks #2 Rank (short-term Buy recommendation) over the next
TETRA TECH NEW (TTEK): Free Stock Analysis
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