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NEW YORK - Tutor Perini Corporation (NYSE:TPC), in partnership with O&G Industries, Inc., has been awarded a $1.18 billion contract by the Port Authority of New York and New Jersey. The contract is for the AirTrain Newark Replacement Program - Guideway and Stations Project at Newark Liberty International Airport in New Jersey. The project involves replacing the current AirTrain system, which has been operational since 1996, with a new 2.5-mile elevated, automated people mover train system, including three stations.
As the managing partner of the joint venture, Tutor Perini will lead the project, with O&G Industries holding a 25% partnership stake. Parsons Corporation (NYSE:NYSE:PSN) will be the lead design subcontractor for the venture.
Tutor Perini Corporation, a company with a history dating back to 1894, is recognized for its role in significant construction projects, particularly for its ability to complete complex projects on time and within budget while maintaining quality standards. The company offers a range of construction services, including general contracting, pre-construction planning, project management, and self-performed construction services.
The announcement of this contract underscores the company's continued involvement in large-scale infrastructure projects. This project aims to enhance the transportation infrastructure at Newark Liberty International Airport, a critical hub for both domestic and international travel.
The information in this article is based on a press release statement from Tutor Perini Corporation.
In other recent news, Parsons Corporation has made significant strides in expanding its infrastructure capabilities and improving its financial performance. The technology provider recently completed the acquisition of BCC Engineering, a Florida-based transportation engineering firm, for $230 million. This strategic move is expected to enhance Parsons' position in infrastructure, coinciding with the Southeastern region's significant federal investment.
The acquisition aligns with Parsons' growth strategy, targeting companies with strong revenue growth and adjusted EBITDA margins. BCC Engineering will be integrated into Parsons' North America Infrastructure business unit, further enhancing the company's service offerings and market reach.
On the financial front, Parsons reported record third-quarter results, with revenues hitting $1.8 billion, marking a 28% increase year-over-year. This robust growth was accompanied by a 31% rise in adjusted EBITDA, leading the company to raise its full-year guidance for both revenue and adjusted EBITDA. Jefferies maintained a Buy rating on Parsons, increasing the price target to $130.00 from the previous $125.00, based on the company's year-to-date organic growth and future revenue prospects.
Parsons' Federal Solutions segment saw a notable 42% increase in revenue, while the Critical Infrastructure segment grew by 10%. Despite a $23.5 million write-down, Parsons is transitioning away from legacy contracts to focus on core design and program management roles. Looking ahead, the company has raised its fiscal 2024 guidance, expecting revenue to fall between $6.6 billion and $6.8 billion, and adjusted EBITDA to be between $590 million and $620 million.
InvestingPro Insights
To complement the news of Tutor Perini's major contract win, let's take a closer look at Parsons Corporation (NYSE:PSN), the lead design subcontractor for this significant infrastructure project.
According to InvestingPro data, Parsons Corporation has a market capitalization of $10.1 billion, reflecting its substantial presence in the engineering and construction sector. The company's revenue for the last twelve months as of Q3 2023 stood at $6.51 billion, with an impressive revenue growth of 28.88% over the same period. This growth aligns well with the company's involvement in large-scale projects like the AirTrain Newark Replacement Program.
InvestingPro Tips highlight that analysts anticipate sales growth for Parsons in the current year, which could be partly attributed to contracts such as this one. Additionally, the company's net income is expected to grow this year, suggesting a positive financial outlook that may be bolstered by its participation in major infrastructure initiatives.
It's worth noting that Parsons operates with a moderate level of debt and its liquid assets exceed short-term obligations, indicating a solid financial position to undertake large projects. This financial stability is crucial for executing complex, long-term contracts like the AirTrain replacement.
For investors interested in a deeper analysis, InvestingPro offers 14 additional tips for Parsons Corporation, providing a more comprehensive view of the company's financial health and market position.
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