FTI Consulting (FCN) AI Stock Analysis

• Market Cap: $5.67B
• Dividend Yield: N/A
• Average Volume (3M): 351.21K
• Price to Earnings (P/E): 22.6
• Beta (1Y): 0.23
• Revenue Growth: 1.59%
• EPS Growth: -16.79%
• Country: US
• Employees: 8,105
• Sector: Industrials
• Sector Strength: 87
• Industry: Consulting Services
• EPS (TTM): 2.29
• Shares Outstanding: 34,286,987
• 10 Day Avg. Volume: 289,238
• 30 Day Avg. Volume: 351,210
• PEG Ratio: -3.32
• Price to Book (P/B): 2.70
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 31.71
• Enterprise Value/Market Cap: 1.03
• Enterprise Value/Revenue: 0.39
• Enterprise Value/Gross Profit: 4.98
• Enterprise Value/Ebitda: 3.42
• 1Y Price Target: $177.00
• Price Target Upside: 7.12% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 73 Outperform
• Price Target: $185.00 ▲(11.96%Upside)

FTI Consulting's stock score reflects solid financial performance and a balanced earnings call outlook, tempered by technical indicators and valuation concerns. While the company benefits from strong revenue growth and strategic initiatives, profitability and cash flow challenges need addressing to sustain future growth.

Positive Factors

Business Model

The company has a resilient business model, having achieved 11 consecutive years of adjusted EPS growth.

Financial Performance

Adjusted EBITDA of $115 million came in $18 million above our estimate, driving margin of 12.8%.

Talent Retention

Management highlighted early success in replenishing its talent pool.

Negative Factors

Earnings Performance

There was a significant sell-off in shares due to FTI’s second consecutive earnings miss and macroeconomic challenges affecting the firm's performance.

Economic Consulting Challenges

Ongoing risk to estimates from consultant attrition in Economic Consulting.

Future Guidance

Management introduced downside full-year 2025 guidance, forecasting revenues below consensus and indicating challenges in the Economic Consulting segment due to increased employee turnover.

FTI Consulting Business Overview & Revenue Model

Company Description

FTI Consulting, Inc. is a global business advisory firm dedicated to helping organizations manage change, mitigate risk, and resolve disputes. With a team of experts in various fields, FTI Consulting operates across multiple sectors including corporate finance and restructuring, economic consulting, forensic and litigation consulting, strategic communications, and technology. The firm provides tailored solutions to complex business challenges, serving a diverse clientele that includes corporations, law firms, and government agencies.

How the Company Makes Money

FTI Consulting makes money through a diversified revenue model that primarily involves charging clients for professional services provided by its various business segments. Key revenue streams include consulting fees from its corporate finance and restructuring services, where the firm assists companies with financial advisory and operational improvement strategies. The economic consulting segment generates revenue by providing economic analysis and expert testimony in legal and regulatory proceedings. Forensic and litigation consulting offers investigative services and litigation support, contributing to the firm's earnings through fees for expert witness services and forensic analysis. The strategic communications segment earns revenue by offering advice on managing stakeholder relationships and protecting client reputations. Additionally, the technology segment provides e-discovery and information governance services, further diversifying the firm's income. FTI Consulting's earnings are also supported by significant partnerships with legal firms and corporations that require specialized advisory services. These partnerships help in securing long-term contracts and repeat business, contributing to steady revenue growth.

FTI Consulting Financial Statement Overview

Summary

FTI Consulting demonstrates strong financial performance with robust revenue growth and a solid balance sheet. However, recent declines in profitability margins and free cash flow growth indicate areas for improvement.

Income Statement

FTI Consulting has demonstrated robust revenue growth over the years, with the latest TTM (Trailing-Twelve-Months) revenue at $3.67 billion. The gross profit margin stood at an impressive 31.83%, indicating efficient cost management. However, the recent decline in EBIT and net income margins suggests some pressure on profitability. The revenue growth rate from 2024 to TTM is negative, primarily due to a slight dip in annual revenue, which needs to be monitored.

Balance Sheet

The company maintains a strong equity base, with a debt-to-equity ratio of 0.17, indicating low leverage and financial stability. The equity ratio of 64.20% further demonstrates a solid financial position. Return on equity (ROE) stands at 12.19%, showing reasonable returns to shareholders. However, the reduction in stockholders' equity from the previous year is a concern and warrants attention.

Cash Flow

The operating cash flow to net income ratio of 0.78 suggests a healthy cash generation relative to profits. However, free cash flow has decreased from the previous year, with a significant decline in the free cash flow growth rate. The reduction in capital expenditure is a positive sign, indicating efficient cash management, but the overall declining trend in free cash flow should be addressed.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.70B	3.49B	3.03B	2.78B	2.46B
Gross Profit	1.18B	1.14B	962.93M	860.72M	788.56M
EBITDA	405.81M	419.93M	353.34M	363.36M	338.41M
Net Income	280.09M	274.89M	235.51M	234.97M	210.68M
Balance Sheet
Total Assets	3.60B	3.33B	3.24B	3.10B	2.78B
Cash, Cash Equivalents and Short-Term Investments	660.49M	328.68M	491.69M	494.49M	294.95M
Total Debt	242.15M	257.64M	568.70M	533.18M	447.81M
Total Liabilities	1.34B	1.34B	1.56B	1.52B	1.38B
Stockholders Equity	2.26B	1.98B	1.68B	1.58B	1.40B
Cash Flow
Free Cash Flow	397.72M	174.98M	135.47M	286.82M	292.20M
Operating Cash Flow	395.10M	224.46M	188.79M	355.48M	327.07M
Investing Cash Flow	-10.16M	-73.83M	-60.06M	-79.09M	-60.12M
Financing Cash Flow	-15.38M	-354.66M	-106.01M	-61.67M	-360.05M

FTI Consulting Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 165.24
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FCN, the sentiment is Positive. The current price of 165.24 is above the 20-day moving average (MA) of 164.03, above the 50-day MA of 163.64, and below the 200-day MA of 181.72, indicating a neutral trend. The MACD of 0.48 indicates Positive momentum. The RSI at 53.07 is Neutral, neither overbought nor oversold. The STOCH value of 27.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FCN.

FTI Consulting Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BAH	79 Outperform	$13.88B	15.43	90.74%	2.35%	12.36%	58.08%
FCN	73 Outperform	$5.67B	22.57	12.46%	―	1.59%	-16.79%
HURN	73 Outperform	$2.25B	19.54	24.88%	―	8.83%	92.48%
ICFI	71 Outperform	$1.56B	14.53	11.64%	0.66%	1.95%	17.98%
CRAI	68 Neutral	$1.21B	23.94	23.18%	1.08%	8.49%	21.06%
Sector *	65 Neutral	$10.91B	15.53	5.25%	2.19%	3.15%	-27.00%
EXPO	61 Neutral	$3.69B	35.54	25.87%	1.98%	3.27%	3.94%

FTI Consulting Corporate Events

FTI Consulting Stockholders Approve Incentive Plan Amendment

At the recent Annual Meeting, FTI Consulting‘s stockholders approved an amendment to the 2017 Omnibus Incentive Compensation Plan, which includes an increase of 676,000 shares of common stock and an extension of the plan’s expiration date to June 4, 2035. Additionally, stockholders voted on several proposals, including the election of directors, the ratification of KPMG LLP as the independent auditor for 2025, and an advisory vote on executive compensation, reflecting the company’s commitment to aligning with shareholder interests and strategic growth.

The most recent analyst rating on (FCN) stock is a Buy with a $275.00 price target. To see the full list of analyst forecasts on FTI Consulting stock, see the FCN Stock Forecast page.

FTI Consulting Reports Strong Q1 2025 Performance

FTI Consulting reported a strong first quarter in 2025, driven by significant roles in its Forensic and Litigation Consulting (FLC) segment, despite the confidentiality of many assignments. The company highlighted the importance of its competitive strengths and market strategies in maintaining performance amidst macroeconomic uncertainties, with particular success in restructuring and transaction businesses in specific markets like Germany.

FTI Consulting Increases Stock Repurchase Authorization

FTI Consulting reported a decrease in first quarter 2025 revenues to $898.3 million, down 3.3% from the previous year, primarily due to lower revenues in its Economic Consulting and Corporate Finance & Restructuring segments. Despite the revenue decline, the company announced a $400 million increase in its stock repurchase authorization, bringing the total authorization to $1.7 billion. This move reflects FTI Consulting’s commitment to returning value to shareholders and maintaining financial flexibility. The company also faced a special charge of $25.3 million related to severance and other employee-related costs, impacting its net income, which fell to $61.8 million from $80.0 million in the prior year. However, FTI Consulting’s adjusted EBITDA improved to $115.2 million, indicating resilience in its core operations.

FTI Consulting Reports Q1 2025 Financial Results

FTI Consulting reported its financial performance for the first quarter of 2025, highlighting a 0.4% increase in revenues compared to the previous quarter, but a 3.3% decrease from the same period last year. The company experienced significant growth in adjusted earnings per diluted share and adjusted EBITDA, indicating improved operational efficiency. However, there was a notable decline in cash and cash equivalents, and an increase in total debt, which may impact future financial flexibility. The company’s use of non-GAAP financial measures aims to provide a clearer picture of its core operating performance, though these measures may not be comparable with other companies.