KBR Wins Eight GSA’s ASTRO Contract Awards, Boosts Backlog

KBR, Inc. KBR has secured as many as eight awards in the ASTRO program, sponsored by the U.S. Department of Defense (“DoD”).

Its shares gained 0.09% during the trading session and 1.31% during the after-hours trading session on Dec 14.

The multiple-award, indefinite delivery/indefinite quantity (IDIQ) contract has no specific ceiling value. That said, it is expected to have a multi-billion-dollar budget over its potential 10-year ordering period.

Related to the contract, KBR President and CEOStuart Bradie said, “KBR is excited to continue to support the Department of Defense, particularly its combatant commands, through the ASTRO contract.”

He further added, “The number of pools awarded to KBR shows the depth and breadth of our global expertise and the evolution of our business to address new and emerging threats with innovative solutions.”

Managed by the General Services Administration or GSA’s Federal Systems Integration and Management Center, the ASTRO program now focuses on providing the DoD with technology, products, solutions, and capabilities across all domains as the Department operationalizes convergence.

With these GSA ASTRO awards, KBR will act as a prime contractor in eight areas comprising data operations, mission operations, ground, space, development and systems integration, research, support, and training.

Focus on Government Projects Bodes Well

The company’s Government Solutions unit has been performing pretty well. Presently, KBR is banking on the strength of the said business to optimize growth potential. The performance of the particular business is exceeding market expectation, which is adding to KBR’s bliss.

Higher tasking for various missile defense and other military priorities in its engineering business areas, under select IDIQ contracts, also led to the upside. Further, KBR expects growth across all key markets in the United States, U.K. and Australia, driven by continued opportunities across the lifecycle of projects. For the Government Solution business, the book to bill was 1.2 for 2020 compared with 1.1 in 2019.

As of Sep 30, 2021, total backlog was $14.76 billion compared with $15 billion at 2020-end. Of the total backlog, Government Solutions booked $12.45 billion. The Sustainable Technology Solutions segment accounted for $2.31 billion of the total backlog.

KBR’s shares have gained 45.5% in the year-to-date period, outperforming the Zacks Engineering – R and D Services industry’s 30.4% rally. KBR’s solid prospects are backed by continuous contract wins, strong project execution, backlog level, and potential government as well as technology businesses.

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Zacks Rank

Currently, KBR carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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