Blues singer Mose Allison probably put it best: "You know, this world is just one big trouble spot." Turn on the TV news this holiday week and you'll get inundated with disturbing reports about extreme and deadly storms from coast to coast in the U.S. The apocalyptic images spawned by these weather anomalies are worthy of a science fiction movie.
The one company that's best positioned to profit from remediation efforts at disaster sites is Tetra Tech (TTEK - Get Report) . During the last three months, Tetra Tech has reaped a slew of lucrative new contracts, including two separate wins totaling $646 million from the U.S. Agency for International Development, which is usually among the first agencies to respond to local disasters overseas.
With a market cap of $1.57 billion, Tetra Tech provides consulting, engineering and technical services for the water, environment, energy, infrastructure and natural resources sectors. This stock is the most focused way to make money off the unstoppable trend of climate change.
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Tetra Tech's clients include federal, state and local government agencies in the U.S., as well as commercial and international clients. The company also has a growing presence in the energy sector, for pollution prevention and remediation.
Founded in 1966 and headquartered in Pasadena, Calif., Tetra Tech prepares facilities, infrastructure and supply chains for the worst -- and comes to the rescue when the worst actually occurs.
For nearly five decades, Tetra Tech has responded to thousands of chemical, biological, radiological, nuclear and explosive releases, as well as natural calamities such as hurricanes, tornadoes, floods, and earthquakes. Part of the company's services include search and rescue, as well as infrastructure repair.
Tetra Tech faces competition from a handful of multibillion-dollar engineering and construction firms, particularly Fluor, Halliburton, and AECOM Technology. These companies are politically well connected and regularly obtain sizable amounts of government largesse, in addition to private sector clients.
However, Tetra Tech is the leader in crisis management, whereas the operations of its rivals are considerably more diffuse and their fortunes are more closely tied to the cyclical construction sector.
Tetra Tech's adjusted fourth-quarter fiscal 2015 earnings per share came in at 50 cents, up 39% year over year. For the full year, adjusted EPS reached $1.63, up 27% year over year.
The stock is now trading at about $26.50, but the average stock price target from analysts who cover the company is $29.29, suggesting the stock could gain more than 10% in the coming year. If you're looking for a pure investment play on inexorable global warming, you won't find a better stock.
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