AECOM 's ACM unit, Aecom Technical Services Inc. recently received a $24-million contract from the U.S. Department of Defense. The contact was awarded by the U.S. Army Corps of Engineers, San Francisco, CA.
Per the deal, Aecom Technical Services will provide architecture and engineering services to the U.S. Army and is estimated to be completed by Aug 29, 2023.
Steady Contract Wins to Boost Revenues
AECOM is witnessing robust prospects in all its segments, namely Design and Consulting Services, Construction Services and Management Services. All the three segments of the company recorded growth through the nine months of fiscal 2018, further adding to its growth potential.
At the end of fiscal third quarter, the company recorded a backlog of $54 billion, reflecting a 16% year-over-year increase. The company's solid backlog levels, which are a key indicator of future revenue growth, indicate significant opportunities in the forthcoming quarters. During fiscal third quarter, it secured wins worth $9.4 billion and recorded a book-to-burn ratio of 1.7%, with significant contribution from all the three segments.
However, shares of AECOM have underperformed the industry in the past three months. Its shares have increased 0.3% compared with the industry's rally of 11.4% in the said period.
That said, Trump administration's focus on investing in defense and cyber security is expected to prove conducive to the company's growth. More than 70% of AECOM's profits are generated from infrastructure and defense markets that are poised to benefit from the favorable political climate in the United States, and abroad.
Zacks Rank & Stocks to Consider
Currently, AECOM carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include KBR, Inc. KBR , Gates Industrial Corporation plc GTES and Jacobs Engineering Group Inc. JEC , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
KBR's earnings surpassed the consensus estimate in three of the trailing four quarters, with an average positive surprise of 12.3%.
Gates Industrial's 2018 earnings are expected to increase 42.2%.
Jacobs' fiscal 2018 earnings estimates are expected to rise 35.2%.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free reportJacobs Engineering Group Inc. (JEC): Free Stock Analysis ReportAECOM (ACM): Free Stock Analysis ReportKBR, Inc. (KBR): Free Stock Analysis ReportGates Industrial Corporation PLC (GTES): Free Stock Analysis ReportTo read this article on Zacks.com click here.