KBR Secures $350 Million Contract, Stock Rises
KBR Inc's stock rose by 5.48% as it reached a 5-day high, reflecting positive investor sentiment in the wake of recent market gains.
The surge is attributed to KBR's announcement of a $350 million Technical Support Services Contract with the U.S. Geological Survey (USGS), marking a significant expansion in its capabilities in the Earth observation sector. This contract allows KBR to utilize advanced technologies to enhance USGS's operations, which is expected to improve efficiency and accuracy in data processing. The long-term partnership, now in its 24th year, underscores KBR's technical excellence and innovative capabilities.
This contract not only strengthens KBR's position in the government contracting market but also highlights its role in future Earth observation technologies. Investors are optimistic about the potential for long-term growth as KBR supports the Landsat Next satellite program.
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- Significant Contract Value: KBR has been awarded a firm-fixed-price task order totaling $77 million aimed at enhancing the digital engineering capabilities of the U.S. Space Force, showcasing the company's strong position and demand in the defense sector.
- Project Implementation Locations: The contract will be executed over three years at Colorado Springs, Colorado, and Wright-Patterson Air Force Base in Ohio, ensuring KBR can provide efficient technical support at critical sites.
- Innovation-Driven Technology: KBR will implement Model-Based Systems Engineering (MBSE) architecture, delivering systems engineering, cybersecurity, and software development services to advance secure and scalable digital infrastructure, aligning with Air Force and Department of War digital transformation strategies.
- Foundation for Long-Term Collaboration: This contract builds on KBR's proven performance over the past four years supporting AFRL and Space Force missions, further solidifying the company's leadership in defense innovation solutions.
- Contract Value: KBR has been awarded a cost-plus-fixed-fee contract with a ceiling value of $149 million, aimed at enhancing the Air Force's system capabilities and operational readiness through the ADEDDIS program.
- Project Background: The contract was awarded by the Air Force Life Cycle Management Center (AFLCMC) and focuses on transforming systems at Eglin Air Force Base in Fort Walton Beach, Florida, to accelerate armament development and production.
- Technical Focus: Under this contract, KBR will concentrate on modeling, simulation, and advanced digital and engineering solutions to meet the Air Force's armament development needs, which is expected to significantly enhance operational readiness efficiency.
- Execution Period: The contract has a performance period of seven years, during which KBR will implement the project through initial task orders, ensuring that objectives are met within the specified timeframe.
- Significant Contract Value: KBR has been awarded a $149 million cost-plus-fixed-fee contract aimed at enhancing operational readiness for the U.S. Air Force at Eglin Air Force Base in Florida, showcasing the company's strong competitive position in the defense sector.
- Comprehensive Project Scope: The contract includes advanced analytics, decision support, digital transformation solutions, and software development, which are expected to accelerate the design and production of weapon systems, thereby enhancing the capabilities and efficiency of warfighters.
- Long-Term Commitment: KBR will execute this contract over a seven-year period, focusing on modeling, simulation, and advanced digital engineering solutions, further solidifying its long-standing presence and influence in the Eglin Air Force Base community.
- Strategic Implications: KBR's CEO, Stuart Bradie, stated that this contract represents a pivotal advancement in the company's digital transformation expertise across defense systems, aiming to provide rapid and reliable solutions for service members and drive innovation in future armament development.
- Earnings Call Announcement: KBR has announced a conference call on February 26, 2026, at 7:30 a.m. Central Time to discuss its Q4 2025 financial results, reflecting the company's commitment to transparency and investor communication.
- Earnings Release Plan: The company plans to issue its Q4 2025 earnings release and presentation prior to the call, ensuring that investors have access to key information in advance, thereby enhancing market trust in KBR.
- Webcast Support: The call will be webcast live through the Investor Relations section of KBR's website, increasing accessibility of information and allowing global investors to participate and stay updated on the company's latest developments.
- Replay Availability: After the call, a replay of the webcast will be available on the KBR website or via telephone, ensuring that investors who cannot attend live can still access relevant information, further enhancing interaction between the company and its investors.
- Put Option Yield: KBR's $42.50 put option has a current bid of $1.90, and if an investor sells this contract, they commit to buying shares at $42.50, resulting in a cost basis of $40.60, which is approximately a 4% discount from the current price of $44.39, making it attractive for interested investors.
- Expiration Risk Analysis: The probability of the put option expiring worthless is 63%, and if it does, the premium would yield a 4.47% return on cash commitment, annualized at 6.63%, highlighting the potential appeal of this strategy.
- Call Option Yield: The $45.00 call option for KBR has a current bid of $2.70, and if an investor buys shares at $44.39 and sells this contract, they could achieve a total return of 7.46% if the stock is called away at expiration, showcasing the potential benefits of a covered call strategy.
- Market Volatility: The implied volatility for the put option is 36%, while for the call option it is 34%, with the actual trailing twelve-month volatility calculated at 32%, providing investors with a basis for assessing the risk and return of KBR's stock options.

- Contract Award: KBR has secured a front-end engineering and design contract for the Coastal Bend LNG project, marking a significant role in the construction of a natural gas liquefaction and export facility on the Texas Gulf Coast, which is expected to enhance the company's market share in the energy sector.
- Coordination Support: KBR will provide overall coordination among parties and assist Coastal Bend with FERC filings and permitting, which not only improves project compliance but also strengthens KBR's expertise in large infrastructure projects.
- Market Outlook: The successful implementation of this project will help meet the growing demand for natural gas exports, and KBR's involvement in such critical projects further solidifies its strategic position in the global energy transition.
- Financial Impact: While the specific contract value has not been disclosed, KBR's ongoing investments and project participation in the energy sector are expected to positively impact future financial performance, boosting investor confidence.







