TTEK clinches a five-year multiple-award deal from United Utilities for the management of flooding and control of stormwater overflows in the United Kingdom.
TTEK clinches three $416 million multiple-award deals from the USACE to provide technical services for facilities and sites across the Indo-Pacific region.
Tetra Tech's stock correction due to USAID concerns appears overdone as USAID is just ~10% of its revenue and TTEK continues to see healthy secular growth trends in remaining businesses. Margins are expected to expand as the company shifts focus to higher-margin consulting services and reduces lower-margin USAID work. The stock's recent correction is presenting a buying opportunity, given the company's strong fundamentals and exposure to secular growth trends.
Tetra Tech has a strong balance sheet, a resilient revenue base, and delivered double-digit revenue growth through strategic acquisitions, expanding margins and controlling costs. Tetra Tech's profitability, cash flow generation, and disciplined capital allocation stand out, with strong operational performance and balanced reinvestment and shareholder returns. Despite a 24% margin of safety in my valuation, I recommend waiting for a 30% margin of safety before buying, due to recent stock price declines.
Increasing costs and high debt levels weigh on TTEK. Unfavorable foreign currency movement is an added concern.
Tetra (TTEK) reported earnings 30 days ago. What's next for the stock?
Tetra Tech, Inc. (NASDAQ:TTEK ) Q1 2025 Results Conference Call January 17, 2025 11:00 AM ET Company Participants Dan Batrack - Chairman and Chief Executive Officer Steve Burdick - Chief Financial Officer Leslie Shoemaker - Chief Innovation Officer Conference Call Participants Tim Mulrooney - William Blair Sangita Jain - KeyBanc Capital Markets Sabahat Khan - RBC Capital Markets Tate Sullivan - Maxim Group Justin Hauke - Baird Michael Dudas - Vertical Research Partners Operator Good morning and thank you for joining Tetra Tech's Earning Call. As a reminder, Tetra Tech is also simulcasting this presentation with slides in the Investor section of its website at tetratech.com.
TTEK's first-quarter fiscal 2025 results reflect growth across each of its segments, driven by solid momentum across end markets.
Tetra Tech (TTEK) came out with quarterly earnings of $0.35 per share, beating the Zacks Consensus Estimate of $0.34 per share. This compares to earnings of $0.28 per share a year ago.
TTEK is poised to gain from business strength, acquisitions and shareholder-friendly moves. However, rising costs and expenses pose a threat to its margins and profitability.
Tetra Tech (TTEK) is a highly cash-productive business with strong capital efficiency, earning high returns on capital and offering a favorable risk/reward profile. The company has a robust historical growth record, driven by efficient capital allocation and competitive advantages in the water treatment and environmental consulting sectors. TTEK's valuation is fair at 28x NOPAT in my view, with intrinsic worth estimated between $45-$54/share, making it a buy for a 3-year horizon.
TTEK benefits from strength in the GSG segment, driven by increased environmental and advanced water treatment work.