We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Tetra Tech (TTEK) Q3 Earnings & Revenues Top Estimates, Up Y/Y
Read MoreHide Full Article
Tetra Tech, Inc. (TTEK - Free Report) reported solid third-quarter fiscal 2021 (ended Jun 27, 2021) results, with earnings surpassing estimates by 9.2%. This was the 16th consecutive quarter of better-than-anticipated results.
Its share price decreased 0.7% yesterday, ending the trading session at $129.99.
The company’s adjusted earnings per share in the reported quarter came in at 95 cents, outpacing the Zacks Consensus Estimate of 87 cents. Earnings increased 21.8% from the year-ago quarter’s 78 cents.
The bottom line also topped management’s projection of 85-90 cents per share.
Revenues & Segmental Performance
In the fiscal third quarter, Tetra Tech generated adjusted revenues of $801.5 million, reflecting a year-over-year increase of 12.9%. Adjusted net revenues (adjusted revenues minus subcontractor costs) came in at $638 million, up 13.9%. The figure came within the company’s guidance of $600-$650 million.
Tetra Tech’s revenues also exceeded the Zacks Consensus Estimate of $630 million.
Backlog at the end of the quarter was $3,249.9 million, up 3.2% from the previous quarter.
Revenues from the U.S. Federal customers (accounting for 29% of the quarter’s revenues) were up 7% year over year. Revenues increased from growth in advanced analytics and international development projects.
The U.S. Commercial sales (21% of the quarter’s revenues) declined 2% year over year on discretionary industrial programs timing. Stability was witnessed in regulatory-driven programs.
The U.S. State and Local sales (16% of the quarter’s revenues) increased 31% on strength across municipal infrastructure and disaster response. International sales (34% of the quarter’s revenues) increased 26% year over year, backed by strength across commercial discretionary and government projects.
The company reports revenues under the segments discussed below:
Net sales of Government Services Group came in at $356 million, up 12% year over year.
Revenues from Commercial / International Services Group totaled $282 million, underlining a year-over-year increase of 17%.
Margin Profile
In the fiscal third quarter, Tetra Tech’s subcontractor costs totaled $163.6 million, reflecting a rise of 9.4% from the year-ago quarter. Other costs of revenues (adjusted) were $512.3 million, up 14.9%. Selling, general and administrative expenses (adjusted) were $55.9 million, up 10%.
Net income in the reported quarter increased 14.1% year over year to $51.9 million, while adjusted margin expanded 30 basis points to 10.9%.
Balance Sheet and Cash Flow
Exiting the fiscal third quarter, Tetra Tech had cash and cash equivalents of $234.3 million, up 4% from $225.3 million recorded at the end of the prior quarter. Long-term debt was down 1.8% sequentially to $234 million from $238.3 million.
In the first nine months of fiscal 2021, it generated net cash of $226.5 million from operating activities compared with $194.6 million in the year-ago period. Capital expenditure was $6.2 million, down 34%. In the same time frame, the company’s proceeds from borrowings amounted to $165.6 million, while repayments totaled $173.9 million.
Shareholder-Friendly Policies
In the first nine months of fiscal 2021, the company bought back shares worth $45 million and distributed dividends totaling $29.2 million.
Exiting the fiscal third quarter, the company had $163 million worth authorization left under its approved buyback programs.
On Jul 26, 2021, the company’s board of directors approved the payment of a quarterly cash dividend of 20 cents per share. The company will pay out the dividend on Sep 3 to shareholders on record as of Aug 20, 2021.
Outlook
For fiscal 2021 (ending September 2021), Tetra Tech anticipates net revenues of $2.50-$2.55 billion compared with $2.45-$2.55 billion guided earlier, and adjusted earnings are predicted to be $3.69-$3.74 compared with $3.60-$3.70 estimated earlier. The bottom-line projection is higher than the $3.26 recorded in fiscal 2020.
For the fiscal fourth quarter (ending September 2021), the company estimates net revenues of $650-$700 million and adjusted earnings per share of 95 cents to $1.00.
Tetra Tech, Inc. Price, Consensus and EPS Surprise
Image: Bigstock
Tetra Tech (TTEK) Q3 Earnings & Revenues Top Estimates, Up Y/Y
Tetra Tech, Inc. (TTEK - Free Report) reported solid third-quarter fiscal 2021 (ended Jun 27, 2021) results, with earnings surpassing estimates by 9.2%. This was the 16th consecutive quarter of better-than-anticipated results.
Its share price decreased 0.7% yesterday, ending the trading session at $129.99.
The company’s adjusted earnings per share in the reported quarter came in at 95 cents, outpacing the Zacks Consensus Estimate of 87 cents. Earnings increased 21.8% from the year-ago quarter’s 78 cents.
The bottom line also topped management’s projection of 85-90 cents per share.
Revenues & Segmental Performance
In the fiscal third quarter, Tetra Tech generated adjusted revenues of $801.5 million, reflecting a year-over-year increase of 12.9%. Adjusted net revenues (adjusted revenues minus subcontractor costs) came in at $638 million, up 13.9%. The figure came within the company’s guidance of $600-$650 million.
Tetra Tech’s revenues also exceeded the Zacks Consensus Estimate of $630 million.
Backlog at the end of the quarter was $3,249.9 million, up 3.2% from the previous quarter.
Revenues from the U.S. Federal customers (accounting for 29% of the quarter’s revenues) were up 7% year over year. Revenues increased from growth in advanced analytics and international development projects.
The U.S. Commercial sales (21% of the quarter’s revenues) declined 2% year over year on discretionary industrial programs timing. Stability was witnessed in regulatory-driven programs.
The U.S. State and Local sales (16% of the quarter’s revenues) increased 31% on strength across municipal infrastructure and disaster response. International sales (34% of the quarter’s revenues) increased 26% year over year, backed by strength across commercial discretionary and government projects.
The company reports revenues under the segments discussed below:
Net sales of Government Services Group came in at $356 million, up 12% year over year.
Revenues from Commercial / International Services Group totaled $282 million, underlining a year-over-year increase of 17%.
Margin Profile
In the fiscal third quarter, Tetra Tech’s subcontractor costs totaled $163.6 million, reflecting a rise of 9.4% from the year-ago quarter. Other costs of revenues (adjusted) were $512.3 million, up 14.9%. Selling, general and administrative expenses (adjusted) were $55.9 million, up 10%.
Net income in the reported quarter increased 14.1% year over year to $51.9 million, while adjusted margin expanded 30 basis points to 10.9%.
Balance Sheet and Cash Flow
Exiting the fiscal third quarter, Tetra Tech had cash and cash equivalents of $234.3 million, up 4% from $225.3 million recorded at the end of the prior quarter. Long-term debt was down 1.8% sequentially to $234 million from $238.3 million.
In the first nine months of fiscal 2021, it generated net cash of $226.5 million from operating activities compared with $194.6 million in the year-ago period. Capital expenditure was $6.2 million, down 34%. In the same time frame, the company’s proceeds from borrowings amounted to $165.6 million, while repayments totaled $173.9 million.
Shareholder-Friendly Policies
In the first nine months of fiscal 2021, the company bought back shares worth $45 million and distributed dividends totaling $29.2 million.
Exiting the fiscal third quarter, the company had $163 million worth authorization left under its approved buyback programs.
On Jul 26, 2021, the company’s board of directors approved the payment of a quarterly cash dividend of 20 cents per share. The company will pay out the dividend on Sep 3 to shareholders on record as of Aug 20, 2021.
Outlook
For fiscal 2021 (ending September 2021), Tetra Tech anticipates net revenues of $2.50-$2.55 billion compared with $2.45-$2.55 billion guided earlier, and adjusted earnings are predicted to be $3.69-$3.74 compared with $3.60-$3.70 estimated earlier. The bottom-line projection is higher than the $3.26 recorded in fiscal 2020.
For the fiscal fourth quarter (ending September 2021), the company estimates net revenues of $650-$700 million and adjusted earnings per share of 95 cents to $1.00.
Tetra Tech, Inc. Price, Consensus and EPS Surprise
Tetra Tech, Inc. price-consensus-eps-surprise-chart | Tetra Tech, Inc. Quote
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks are AZZ Inc. (AZZ - Free Report) , Brady Corporation (BRC - Free Report) and Donaldson Company, Inc. (DCI - Free Report) . While AZZ currently sports a Zacks Rank #1 (Strong Buy), Brady and Donaldson carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AZZ delivered an earnings surprise of 21.24%, on average, in the trailing four quarters.
Brady delivered an earnings surprise of 1.58%, on average, in the trailing four quarters.
Donaldson delivered an earnings surprise of 9.02%, on average, in the trailing four quarters.