Tutor Perini (TPC) and O&G JV Wins Amtrak Bridge Project
Tutor Perini Corporation TPC, in a joint venture (JV) with O&G Industries, Inc. (“O&G”), secured a contract from Amtrak for the Connecticut River Bridge Replacement Project.
Per the contract, TPC will construct a new two-track, electrified and resilient bascule bridge structure along the Northeast Corridor. The project includes installing new tracks, signal systems, catenary lines, power infrastructure, communication networks, controls and security features.
Valued at about $1.3 billion, Amtrak's project aims to address structural deficiencies and modernize the bridge for improved vertical clearance and speed capabilities. It is primarily funded by the Infrastructure Investment & Jobs Act (IIJA), with a federal grant of $826.6 million from the Federal Railroad Administration covering most costs, supported by additional funding from Amtrak and contributions from the state of Connecticut.
The construction is set to begin in late summer or early fall 2024, with substantial completion expected by 2031. Tutor Perini, which holds a 30% stake in the JV, will add its share of the contract value to the second-quarter 2024 backlog.
Consistent Contract Wins: A Boon
Tutor Perini’s efficient project execution and diversified delivery methods and services have helped it secure new contracts and awards consistently. This is the primary growth driver of the company that adds to its backlog level, determining the long-term growth prospects in this everchanging economy. During first-quarter 2024, TPC's backlog increased 26% year over year, reaching a robust $10 billion, reflecting strong growth and stability.
On Jun 20, Tutor Perini Corporation's subsidiary, Lunda Construction Company, secured a $53.6-million contract for the Kellogg/3rd Street Bridge Replacement Project from St. Paul, MN.
On May 29, TPC’s joint venture with its subsidiary, Black Construction Corporation, won a $74.4-million Child Development Center contract at Andersen Air Force Base, Guam. The contract was awarded by the U.S. Naval Facilities Engineering Systems Command, Pacific District.
As of Mar 31, 2024, consolidated new awards of TPC were $872.8 million, up 13.8% from $766.7 million reported a year ago. The uptick was primarily driven by the increased new award activity in the Building and Civil segments. A few significant new awards and contract adjustments in the first quarter include a $243-million healthcare facility project in California, a $73-million airport hangar project in Florida, $66 million of additional funding for several other healthcare projects in California, $55 million for three U.S. Navy projects in Diego Garcia and an additional $52-million funding for three mass-transit projects in California.
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Shares of this civil, building and specialty construction company surged 195.3% in the past year compared with the Zacks Building Products - Heavy Construction industry’s 41.7% growth. The company is optimistic about its bidding pipeline as it witnesses several active opportunities on large projects, thanks to substantial government funding and limited competition for many larger projects.
Zacks Rank & Key Picks
Currently, Tutor Perini has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Zacks Construction sector are:
Howmet Aerospace Inc. HWM sports a Zacks Rank #1 (Strong Buy). HWM has a trailing four-quarter earnings surprise of 8.5%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for HWM’s 2024 sales and earnings per share (EPS) indicates a rise of 10.7% and 29.9%, respectively, from the prior-year levels.
Sterling Infrastructure, Inc. STRL carries a Zacks Rank #2 (Buy). Sterling Infrastructure has a trailing four-quarter earnings surprise of 22.3%, on average.
The Zacks Consensus Estimate for STRL’s 2024 EPS indicates a rise of 18.6% from the prior-year levels.
Gates Industrial Corporation plc GTES carries a Zacks Rank #2. GTES has a trailing four-quarter earnings surprise of 14.9%, on average.
The Zacks Consensus Estimate for GTES’ 2024 EPS indicates growth of 2.9% from prior-year levels.
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