Latest news with #TetraTechInc
Business Mayor
19-05-2025
- Business
- Business Mayor
Tetra Tech Takes a Hit – Los Angeles Business Journal
Pasadena-based engineering and consulting firm Tetra Tech Inc. took a major hit in the first quarter with the shutdown of its largest client, the U.S. Agency for International Development. But the company still managed to post one of its strongest quarterly earnings results as it found new business elsewhere. In its May 8 quarterly earnings call, Dan Batrack, Tetra Tech's chief executive, said the USAID shutdown cost the company about $1.1 billion worth of contract awards that had been part of the company's project backlog. The shutdown also forced the company to take a $92 million impairment charge. Yet Tetra Tech still managed to post one of its better quarters for earnings, with the third-highest earnings per share and operating revenue marks in the company's history, a feat all the more remarkable considering January through March is typically the slowest time of the year for the company. 'We just had one of the most interesting quarters in the history of the company,' Batrack told analysts at the outset of the earnings conference call. The company's history dates back to 1966. 'Never have we seen our largest client by revenue essentially disappear within just one quarter,' he added. 'If you'd asked me 20 years ago what would have been the impact for quarterly results of this happening, I'm not sure I could have told you, but it certainly wouldn't have been good,' Batrack continued. 'But today, in this quarter, through the incredible diversity of our clients, diversity of the services we provide and the geographies that we operate in, we had one of the best quarters in the company's history.' Indeed, net revenue (not including contract dollars passed through to subcontractors) rose 5% during the quarter to $1.1 billion compared with the same quarter last year, while operating income rose 11% to $130 million – despite the loss of USAID work. Investors reacted favorably, sending Tetra Tech shares up 13% on May 8, the trading session after the earnings release and conference call. The stock has not moved significantly since then. Tetra Tech's challenges began the day President Donald Trump took office for his second term. One of the first executive orders he signed froze all foreign aid and called for a review of aid policy. Batrack said Trump's executive order resulted in immediate 'stop-work' orders for most of its USAID contracts. Its employees working on those contracts were effectively in limbo, though they were still employed by the company. Then, the Elon Musk-led Department of Government Efficiency, or DOGE, went through USAID operations, and in early February cancelled more than 100 contracts, including more than 20 contracts with Tetra Tech. The canceled contracts ranged in size from $10.2 million to $95.5 million. And then on Feb. 27, Secretary of State Marco Rubio announced that approximately 5,200 of USAID's 6,200 programs were being eliminated, with the rest transferred to the Rubio-led State Department. USAID was effectively shuttered. Batrack said that was the day the status of the Tetra Tech workers on those eliminated contracts went to 'termination for convenience.' He noted that the company incurred costs for that five-week period between the Jan. 20 date the stop-work orders went out and the Feb. 27 date when the contracts were terminated. He did not disclose what happened to the workers on those contracts. Tetra Tech took those contracts out of its project backlog, which consists of work that the company has contracts for but not yet begun. And for the first time since the USAID episode began, Batrack put a number on the value of those contracts. 'Tetra Tech's updated backlog is now…$4.31 billion,' he said. 'This $4.3 billion captures the de-obligation of approximately $1.1 billion in USAID and Department of State projects.' The company also took a non-cash, goodwill impairment charge of $92.4 million during the quarter. No specifics were offered. Not all of Tetra Tech's USAID work was eliminated. About $220 million remains, most of that for work in Ukraine that is part of a massive $450 million multi-year contract. USAID had been Tetra Tech's largest single client, representing nearly 10% of all net revenue and about one-third of all the company's work for the federal government. Yet for the first three months of this year, net revenue from federal government work still grew 1% compared to the same period last year as work for other federal agencies grew 16%. Tetra Tech's biggest victory in this sector came in March when the company announced it had won a slice of work on three contracts for environmental engineering services with the U.S. Army Corps of Engineers Honolulu District worth as much as $416 million. Each of these contracts involve multiple companies that are on call for individual projects as they come up. Tetra Tech also announced and added to its backlog four other contracts with the Army Corps of Engineers during the quarter, including one with the Corps' Los Angeles district. Most of this work is for ongoing environmental and engineering services. The Army Corps of Engineers is now Tetra Tech's largest single client. Staff Reporter Mark Madler contributed to this article.
Yahoo
29-03-2025
- Business
- Yahoo
Why Tetra Tech Inc (TTEK) Is Plunging in 2025?
We recently published a list of . In this article, we are going to take a look at where Tetra Tech Inc (NASDAQ:TTEK) stands against other construction stocks that are plunging in 2025. 2025 is shaping up to be a pivotal moment for the construction industry. Not long ago, the sector was booming. Infrastructure construction stocks soared as government contracts poured in and a broader economic expansion fueled optimism. There were massive infrastructure and energy projects with endless growth potential, and companies tied to these projects thrived. However, the pendulum has swung hard in the opposite direction. Today, the industry faces a stark slowdown, and those once-high-flying construction stocks are plunging. The U.S. GDP is expected to contract in Q1 2025, and residential and commercial projects are stalling as financing costs rise and demand weakens. Looking ahead, the outlook is murky at best. Some experts predict a modest rebound in late 2025 if interest rates ease and loan activity picks up. But considering tariffs are only getting higher, this could drive up inflation again and cause interest rates to stay up. These stocks have borne the brunt of the downturn. It's worth looking into if you want a front-row seat to the industry's ups and downs. For this article, I screened the worst-performing construction stocks year-to-date. I will also mention the number of hedge fund investors in these stocks. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). An energy executive observing a wind turbine farm from a remote location. Number of Hedge Fund Holders In Q4 2024: 37 Tetra Tech Inc (NASDAQ:TTEK) is a consulting and engineering services firm. The stock is down significantly so far in 2025 as the Trump administration significantly reduced funding for the U.S. Agency for International Development (USAID), which is a major client of Tetra Tech. This included slashing foreign aid contracts and laying off USAID workers. These cuts have directly impacted Tetra Tech's revenue from multibillion-dollar contracts awarded in 2024, such as a $5 billion contract for clean water projects and a $439 million energy contract for Ukraine. As a result, the stock fell. Rising input costs increased the total cost of sales by 15.5% year-over-year in Q1 FY2025. Plus, the company's long-term debt reached $889 million, with liabilities exceeding cash equivalents significantly. Moreover, in Q1 FY2025, Tetra Tech disclosed legal settlement costs amounting to $0.35 per share. The consensus price target of $47.92 implies 62.44% upside. TTEK stock is down 25.82% year-to-date. Overall, TTEK ranks 9th on our list of construction stocks that are plunging in 2025. While we acknowledge the potential of TTEK as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than TTEK but that trades at less than 5 times its earnings, check out our report about the . READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
Yahoo
23-02-2025
- Business
- Yahoo
Is Tetra Tech Inc. (TTEK) The Best 52-Week Low Stock To Buy Now According to Short Sellers?
We recently published a list of . In this article, we are going to take a look at where Tetra Tech Inc. (NASDAQ:TTEK) stands against other best 52-week low stocks to buy now according to short sellers. The US stock market reached new all-time highs in late February 2025, as inflation remained near the 2% target while a potential end in the Ukraine conflict sparked some optimism for the long term. Besides the creation of multi-billion-dollar demand for potential rebuilding efforts of the country, including agriculture, residential, and infrastructure, the return of American business to Ukraine and Russia is a big win for most corporations, many of which could experience up to double-digit uplift in revenue and earnings growth due to up to 200 million customer market. More importantly, this outlook is favorable for energy security, stimulates volumes, and might push energy prices lower, which in turn allows for higher profitability. Despite the aforementioned tailwinds, the US stock market gains are still largely driven by the Magnificent 8 companies, which trade at record-high valuations and have contributed to an unprecedented rise in the stock market concentration. These companies are anticipated to have tremendous growth opportunities arising from AI and data center megatrends, on top of existing rapidly growing niches like cloud computing, media streaming, SaaS, and others. Only time will tell whether the current valuations are fair; what is certain is that many industries have been struggling since 2022, as inflationary pressures followed by high interest rates and an increasingly tough labor market dominated by layoffs and scarcity of entry-level positions have put tremendous pressure on US consumers. The high financing costs have led to diminishing Capex appetite in many industries, leading to struggle in several market segments – perfectly illustrated by underperforming consumer discretionary and industrial sectors since 2022. On top of harsh macro conditions in the last 3 years, the new 'Trump 2.0' regime and his administration can be a threat for the healthcare sector. Trump is a notorious critic of the health insurance business and might create headwinds for it through attempts of deregulation and efforts to cut the government financing of healthcare programs. As a result, the healthcare sector relative to the overall market is at record lows comparable to the 2008 depression. All in all, despite apparent optimism in the market, there are pockets of underperformance and many companies trading near their 52-week low, which may present compelling opportunities to acquire good companies at attractive prices. We screened 30-40 stocks with at least $1 billion in market cap that are near their 52-week lows. Then we sorted them by open short interest as a percentage of outstanding shares and included the top 16 with the lowest open short interest in the article. Our belief is that a low open short interest implies a lack of bearish views on the business from leading hedge funds, which represents a bullish signal from a contrarian perspective. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 363.5% since May 2014, beating its benchmark by 208 percentage points (). An energy executive observing a wind turbine farm from a remote Tech Inc. (NASDAQ:TTEK) is a leading global consulting and engineering firm specializing in water, environment, infrastructure, and sustainable solutions. The company provides high-end consulting, data analytics, and engineering services to government and commercial clients, addressing complex challenges in resource management, climate resilience, and energy transition. With a strong focus on innovation and sustainability, TTEK leverages advanced technologies, including AI and digital modeling, to optimize project outcomes. The share price of Tetra Tech Inc. (NASDAQ:TTEK) has been down more than 40% since early November as the company was hit by several large projects related to USAID being put on hold, with an almost certain probability that they will be ultimately canceled. The USAID work, which included water, energy, and economic programs worldwide, was typically for multiyear commitments and represented a significant portion of revenues. Current market fears are elevated as the company could be affected by further cuts in government spending, both within the US and abroad, especially considering the cost-reimbursable nature of the contracts. On the positive side, once the USAID and other at-risk programs are flushed out during the subsequent quarters, TTEK will be left with a strong and high-growth core business. Tetra Tech Inc. (NASDAQ:TTEK)'s services across the board continue to be in very high demand for things such as providing clean, secure water supplies, ensuring a healthy environment, or designing and putting in place resilient infrastructure such that it will not be impacted in the future regarding disasters or any other items. It is of no surprise that TTEK exhibits very low short interest even during peak market fears. Overall, TTEK ranks 5th on our list of best 52-week low stocks to buy now according to short sellers. While we acknowledge the potential of TTEK as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than TTEK but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
