Tetra Tech's (TTEK) outlook remains intact, with Water, Environmental Services and Clean Energy as key focus areas, while management reiterated its fiscal 2030 targets and said it will remain disciplined on mergers and acquisitions, RBC Capital Markets said in a Sunday note.

Management aims to raise revenue from front-end consulting and advisory services to more than 70% from about 65%, while strong water demand from drought, flooding, contaminants, population growth and data center activity continues to support the business.

Federal work, particularly with the US Department of Defense and the FAA, is expected to drive US growth, while UK Water, Canadian infrastructure and self-sufficiency projects, and Australian mining and digital automation support international demand, RBC said.

The brokerage noted that Tetra Tech is using more than 3,000 AI agents across projects, while data center revenue is expected to grow at a double-digit rate and the company aims to increase fixed-price work to more than 60% from about 50%.

RBC reiterated its Outperform rating on the stock with a $46 price target.

Price: 35.78, Change: +0.09, Percent Change: +0.25