Tetra Tech, Inc.
TTEK
recently announced that it has completed the acquisition of IBRA-RMAC Automation Systems, Inc. Financial terms of the transaction were kept under wraps.
Tetra Tech’s shares were up 2% yesterday to close the trading session at $141.01.
Inside the Headlines
San Diego, CA-based IBRA-RMAC is engaged in offering industrial control and automation system engineering services. The company has a strong customer base across municipal and commercial sectors, wherein its services are utilized for water processing, distribution, and safety critical systems designing.
Notably, the acquisition will facilitate Tetra Tech in strengthening its digital water system business, apart from enhancing its customer reach. In fact, IBRA-RMAC’s strong expertise in control systems and digital automation services will help Tetra Tech in boosting its capabilities in digital water consulting services for its customers.
IBRA-RMAC will be part of the company’s Government Services Group business segment. The segment offers consulting and engineering services globally for a wide range of U.S. government clients. Net sales of Government Services Group were $344.9 million in the first quarter of fiscal 2021 (ended Dec 27, 2020).
Other Notable Acquisitions
In February 2021, Tetra Tech acquired Coanda Research & Development. This buyout will enable it to strengthen its advanced analytics business. Also, in September 2020, the company took over BlueWater Federal Solutions, which is likely to enhance its capabilities in cybersecurity solutions, artificial intelligence and mission-critical services for the federal clients.
Moreover, in February 2020, it acquired Segue Technologies, which has strengthened its business associated with government clients, especially the U.S. Department of Defense and commercial customers.
It’s worth mentioning that in fiscal 2020 (ended September 2020), Tetra Tech invested $68.5 million for business acquisitions.
Zacks Rank, Estimates and Price Performance
Tetra Tech, with a $7.6-billion market capitalization, currently carries a Zacks Rank #2 (Buy). High federal government spending, along with strong demand for the company’s services, will be beneficial. Also, acquisitions made by it over the past few quarters are likely to prove advantageous.
In the past 60 days, the Zacks Consensus Estimate for the company’s fiscal 2021 (ending September 2021) earnings has remained stable at $3.59, while the same for fiscal 2022 (ending September 2022) has increased 0.3% to $3.87.
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The company’s shares have gained 30.6% compared with 20.7% growth recorded by the
industry
in the past six months.
Other Stocks to Consider
Some other top-ranked stocks from the same space are
Heritage-Crystal Clean, Inc
HCCI
,
Energy Recovery, Inc.
ERII
and
Sharps Compliance Corp.
SMED
. While Heritage-Crystal currently sports a Zacks Rank #1 (Strong Buy), Energy Recovery and Sharps Compliance carry a Zacks Rank #2. You can see
the complete list of today’s Zacks #1 Rank stocks here
.
Heritage-Crystal delivered a positive earnings surprise of 74.45%, on average, in the trailing four quarters.
Energy Recovery delivered a positive earnings surprise of 232.08%, on average, in the trailing four quarters.
Sharps Compliance delivered a positive earnings surprise of 231.67%, on average, in the trailing four quarters.
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