The 10-second takeaway
For the quarter ended Jan. 1 (Q1), Tetra Tech beat expectations on revenue and met expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share stayed the same.
Margins shrank across the board.
Tetra Tech booked revenue of $492.1 million. The 16 analysts polled by S&P Capital IQ expected revenue of $472.4 million. Sales were 21% higher than the prior-year quarter's $405.6 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
EPS came in at $0.36. The 15 earnings estimates compiled by S&P Capital IQ predicted $0.36 per share. GAAP EPS of $0.36 for Q1 were 0.0% lower than the prior-year quarter's $0.36 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 7.3%, 1,140 basis points worse than the prior-year quarter. Operating margin was 7.3%, 120 basis points worse than the prior-year quarter. Net margin was 4.6%, 90 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $481.8 million. On the bottom line, the average EPS estimate is $0.35.
Next year's average estimate for revenue is $2.01 billion. The average EPS estimate is $1.61.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 406 members out of 418 rating the stock outperform, and 12 members rating it underperform. Among 120 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 118 give Tetra Tech a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Tetra Tech is outperform, with an average price target of $26.65.
Over the decades, small-cap stocks like Tetra Tech have provided market-beating returns, provided they're value-priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.
- Add Tetra Tech to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
More from The Motley Fool
Should Stantec Inc.'s Weaknesses Concern You?
Company size, ability to integrate acquisitions, and high valuation should give investors reason for concern.
Pentagon Awards 10 Navy Contracts Thursday
Northrop, Boeing, BAE, Tetra Tech, and General Electric are among the winners.
Why Tetra Tech Shares Tanked
Is this meaningful? Or just another movement?