Exponent (EXPO) AI Stock Analysis

• Market Cap: $3.50B
• Dividend Yield: 1.66%
• Average Volume (3M): 295.32K
• Price to Earnings (P/E): 34.4
• Beta (1Y): 0.88
• Revenue Growth: 4.90%
• EPS Growth: -1.52%
• Country: US
• Employees: 966
• Sector: Industrials
• Sector Strength: 72
• Industry: Consulting Services
• EPS (TTM): 0.49
• Shares Outstanding: 49,887,226
• 10 Day Avg. Volume: 344,375
• 30 Day Avg. Volume: 295,322
• PEG Ratio: 4.81
• Price to Book (P/B): 10.80
• Price to Sales (P/S): 8.14
• P/FCF Ratio: 33.04
• Enterprise Value/Market Cap: 0.97
• Enterprise Value/Revenue: 5.97
• Enterprise Value/Gross Profit: 14.79
• Enterprise Value/Ebitda: 22.79
• 1Y Price Target: $90.50
• Price Target Upside: 27.77% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 71 Outperform
• Price Target: $77.00 ▲(8.71% Upside)

The score is driven primarily by strong underlying financial performance (high margins, strong free-cash-flow growth, low leverage) and constructive FY2026 guidance with slight margin expansion. Offsetting these positives are weak near-term technical signals and a relatively high P/E, which temper the overall rating.

Positive Factors

Strong margins

Consistently high gross and net margins reflect pricing power and efficient project execution in specialized analytics and engineering services. Durable margins support reinvestment in talent and tools, provide a buffer versus cyclical demand drops, and underpin long-term profitability and cash generation.

Robust cash generation

Very strong free cash flow growth and high income-to-cash conversion show sustainable cash generation from operations. This funds capex, R&D, dividends and buybacks, increases strategic optionality, and reduces reliance on external financing over the medium term.

AI tailwinds & differentiated expertise

Structural demand from AI, electrification and energy infrastructure aligns with Exponent's PhD-level, multidisciplinary skill set. This high-value differentiation supports premium billing, repeat engagements on complex problems, and positions the firm to capture secular growth across critical industrial and tech verticals.

Negative Factors

Slowing revenue growth

Near-term top-line momentum has decelerated to low single digits, which creates pressure to deliver earnings growth through margin expansion or M&A. Sustained slower revenue growth raises execution risk for meeting long-term high-single-digit growth targets and investor expectations.

Margin pressure from one-time costs

Reported margin compression driven by one-time meeting and lease costs demonstrates sensitivity of margins to operating items. If elevated operating expenses persist or recurring cost increases (travel, leases) continue, sustaining high margins will require stronger revenue or efficiency gains.

Elevated DSOs / working capital

Elevated receivables and reimbursables compressed near-term free cash flow conversion. Persistent working capital volatility increases sensitivity to client payment cycles, can reduce available cash for buybacks/dividends, and elevates financing risk during slower revenue periods.

Exponent Business Overview & Revenue Model

Company Description

Exponent, Inc., together with its subsidiaries, operates as a science and engineering consulting company worldwide. It operates in two segments, Engineering and Other Scientific, and Environmental and Health. The Engineering and Other Scientific segment provides services in the areas of biomechanics, biomedical engineering and sciences, buildings and structures, civil engineering, construction consulting, data sciences, electrical engineering and computer science, human factors, materials and corrosion engineering, mechanical engineering, polymer science and materials chemistry, thermal sciences, and vehicle engineering. The Environmental and Health segment offers services in the areas of chemical regulation and food safety, ecological and biological sciences, environmental and earth sciences, and health sciences. The company offers approximately 90 technical disciplines to solve pressing and complicated challenges facing stakeholders. It serves clients in chemical, construction, consumer products, energy, food, beverage and nutrition, government, life sciences, insurance, manufacturing, technology, industrial equipment, transportation, and other sectors of the economy. The company was formerly known as The Failure Group, Inc. and changed its name to Exponent, Inc. in 1998. Exponent, Inc. was founded in 1967 and is headquartered in Menlo Park, California.

How the Company Makes Money

Exponent generates revenue through multiple streams, primarily by selling its software solutions via subscription-based models and one-time licensing fees. The company also earns income from providing professional services, including consulting and training for businesses looking to integrate and maximize the use of its analytics tools. Key revenue streams include recurring subscription fees from software users, project fees from consulting engagements, and potentially revenue-sharing agreements with partners for joint ventures or integrated solutions. Significant partnerships with industry leaders in technology and analytics further bolster its earnings, as they allow Exponent to expand its market reach and enhance its product offerings.

Exponent Financial Statement Overview

Summary

Strong profitability and efficiency (TTM gross margin 40.33%, net margin 18.35%) with robust cash generation (TTM free cash flow growth 63.5% and strong income-to-cash conversion). Balance sheet leverage is low (debt-to-equity 0.21) and ROE is strong (24.77%), though revenue growth has recently slowed (TTM 1.93%) and debt has ticked up modestly.

Income Statement

Exponent's income statement shows strong profitability with a consistent increase in revenue over the years. The TTM data indicates a gross profit margin of 40.33% and a net profit margin of 18.35%, reflecting efficient cost management and strong bottom-line performance. Revenue growth is steady, albeit at a slower pace recently, with a TTM growth rate of 1.93%. EBIT and EBITDA margins are robust, indicating healthy operational efficiency.

Balance Sheet

The balance sheet reflects a solid financial position with a manageable debt-to-equity ratio of 0.21 in the TTM period, indicating low leverage. Return on equity is strong at 24.77%, showcasing effective use of shareholder funds. The equity ratio is healthy, suggesting a stable capital structure. However, a slight increase in debt levels over the periods warrants monitoring.

Cash Flow

Cash flow analysis reveals a positive trajectory with a TTM free cash flow growth rate of 63.5%, indicating strong cash generation capabilities. The operating cash flow to net income ratio is 0.84, and the free cash flow to net income ratio is 0.94, both suggesting efficient conversion of income to cash. The company maintains a solid cash flow position, supporting its operational and strategic initiatives.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	571.36M	558.51M	536.77M	513.29M	466.27M	399.90M
Gross Profit	230.45M	142.28M	135.76M	164.50M	124.21M	96.14M
EBITDA	149.54M	129.25M	120.24M	147.92M	115.41M	90.12M
Net Income	104.84M	109.00M	100.34M	102.33M	101.20M	82.55M
Balance Sheet
Total Assets	761.45M	777.27M	646.78M	586.66M	683.74M	593.77M
Cash, Cash Equivalents and Short-Term Investments	207.38M	258.90M	187.15M	161.46M	297.69M	242.53M
Total Debt	82.60M	81.48M	28.26M	18.60M	14.97M	20.33M
Total Liabilities	358.59M	356.20M	290.69M	265.91M	266.67M	232.28M
Stockholders Equity	402.86M	421.07M	356.08M	320.75M	417.06M	361.50M
Cash Flow
Free Cash Flow	122.90M	137.60M	111.00M	81.76M	117.74M	98.33M
Operating Cash Flow	132.20M	144.54M	127.35M	93.81M	124.57M	103.31M
Investing Cash Flow	-9.30M	-6.94M	-16.36M	-12.04M	38.18M	5.02M
Financing Cash Flow	-134.34M	-65.11M	-86.01M	-215.98M	-62.75M	-88.36M

Exponent Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 70.83
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EXPO, the sentiment is Negative. The current price of 70.83 is below the 20-day moving average (MA) of 73.38, below the 50-day MA of 72.80, and below the 200-day MA of 72.20, indicating a bearish trend. The MACD of -0.43 indicates Positive momentum. The RSI at 43.68 is Neutral, neither overbought nor oversold. The STOCH value of 16.14 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EXPO.

Exponent Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CRAI	78 Outperform	$1.19B	21.81	27.83%	0.97%	8.69%	34.58%
FCN	76 Outperform	$5.38B	22.56	13.30%	―	-0.95%	-10.54%
HURN	75 Outperform	$2.85B	28.86	21.20%	―	12.50%	29.40%
ICFI	74 Outperform	$1.67B	17.11	9.88%	0.65%	-3.81%	-7.05%
EXPO	71 Outperform	$3.50B	34.42	25.79%	1.66%	4.90%	-1.52%
BAH	71 Outperform	$10.26B	12.64	74.53%	2.60%	2.42%	3.05%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Exponent Corporate Events

Exponent Reports Q4 Revenue Growth and Higher Dividend

On February 5, 2026, Exponent reported that fourth-quarter 2025 total revenues rose 7.8% year over year to $147.4 million, with revenues before reimbursements up 4.5% to $129.4 million, and net income improving to $24.8 million, or $0.49 per diluted share; EBITDA increased to $34.7 million, or 26.8% of revenues before reimbursements. For fiscal 2025, which ended January 2, 2026, total revenues grew 4.2% to $582.0 million and revenues before reimbursements rose 3.5% to $536.8 million, while net income edged down to $106.0 million, or $2.07 per diluted share, largely reflecting a less favorable tax impact from share-based awards, even as EBITDA ticked up to $148.1 million. The engineering and other scientific segment accounted for 85% of fourth-quarter revenues before reimbursements and drove growth via increased proactive work in utilities, medical devices and consumer electronics, as well as dispute-related projects in construction, energy and transportation, while the environmental and health segment, representing 15% of fourth-quarter revenues before reimbursements, saw a modest quarterly decline due partly to one fewer week in the reporting period. Exponent also highlighted its capital return program, noting that in fiscal 2025 it paid $61.5 million in dividends, repurchased $97.8 million of stock, ended the year with $221.9 million in cash and cash equivalents, and the board approved a higher quarterly dividend of $0.31 per share to be paid on March 20, 2026 to shareholders of record on March 6, 2026, underscoring confidence in the firm’s cash generation. Management reported headcount growth of about 4% in 2025 and improved utilization in the fourth quarter, and guided to high-single-digit growth in revenues before reimbursements and EBITDA margins in the upper-20% range for both the first quarter and full year 2026, signaling expectations of accelerated growth and sustained profitability as demand rises for Exponent’s multidisciplinary expertise in increasingly complex, technology-driven systems.

The most recent analyst rating on (EXPO) stock is a Buy with a $100.00 price target. To see the full list of analyst forecasts on Exponent stock, see the EXPO Stock Forecast page.