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Primoris Unit Secures $25M Heavy Civil Contract in Texas

Zacks
Primoris Heavy Civil, part of Primoris Services Corporation’s PRIM Civil segment has won a new heavy civil contract worth $25 million from the Texas Department of Transportation.
The project entails the construction of an elevated intersection over two diverging railroad tracks in the greater Houston area. Primoris’ scope of work includes earthwork grading, retaining walls, construction of a 165,000 square foot multidirectional bridge, a storm drainage system, as well as demolition of the existing roadways and associated features.
Work is scheduled to start in the second quarter of 2018 with completion planned in the third quarter of 2020.
This project win comes following another deal by Primoris’ Civil segment. On Jan 4, Primoris announced that it had been awarded a heavy civil award valued at $19 million from the Texas Department of Transportation for a project located in Houston. This award was signed in the fourth quarter of 2017 and will consequently be included in the 2017 year-end backlog calculation.
The award is for two and a half miles of new roadway, including earthwork grading, the construction of four bridges, a four lane concrete paved boulevard roadway with intersections, pipe and inlet storm drainage system, retaining walls, traffic signals, and roadway illumination. Work on the project is expected to start the first quarter of 2018 and slated to be completed in the third quarter of 2019.
Primoris’ Civil segment operates primarily in the Southeastern and Gulf Coast regions of the United States and specializes in highway and bridge construction, airport runway and taxiway construction, demolition, heavy earthwork, soil stabilization, mass excavation, and drainage project. The segment accounted for 20% of the total revenues in the third quarter.
Meanwhile, Primoris seems to be optimistic about bidding opportunities that are expected to continue increasing backlog. Further, the company is poised to benefit from its efforts to strengthen the sales teams, consequently leading to more consistent project wins.
In the past year, Primoris has outperformed the industry which it belongs to. The company’s shares have gained around 14.2%, compared with the industry’s growth of 10.4%.
Zacks Rank & Stocks to Consider
Primoris carries a Zacks Rank #4 (Sell). Better-ranked stocks in the construction sector include Lennar Corporation LEN, PulteGroup, Inc. PHM and NVR, Inc. NVR. All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Lennar has a long-term earnings growth rate of 12.94%. Its shares have been up 51% in the past year.
PulteGroup has a long-term earnings growth rate of 20.51%. In the past year, its shares have rallied 84%.
NVR has a long-term earnings growth rate of 18.8%. Its shares have soared 114% in a year.
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