Montrose Environmental Group (MEG) AI Stock Analysis

• Market Cap: $923.37M
• Dividend Yield: N/A
• Average Volume (3M): 351.69K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.26
• Revenue Growth: 22.77%
• EPS Growth: 44.73%
• Country: US
• Employees: 3,400
• Sector: Industrials
• Sector Strength: 72
• Industry: Waste Management
• EPS (TTM): 0.21
• Shares Outstanding: 35,337,666
• 10 Day Avg. Volume: 422,726
• 30 Day Avg. Volume: 351,685
• PEG Ratio: -0.24
• Price to Book (P/B): 1.14
• Price to Sales (P/S): 0.88
• P/FCF Ratio: 679.91
• Enterprise Value/Market Cap: 1.58
• Enterprise Value/Revenue: 1.77
• Enterprise Value/Gross Profit: 4.33
• Enterprise Value/Ebitda: 20.60
• 1Y Price Target: $33.50
• Price Target Upside: 28.21% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6
• EPS Forecast (FY): -0.01
• Revenue Forecast (FY): $823.52M

• Rating: 69 Neutral
• Price Target: $29.00 ▲(10.98% Upside)

Montrose Environmental Group's overall stock score is driven by strong earnings call performance and improving financial metrics, despite ongoing profitability challenges. Technical indicators suggest a neutral trend, while valuation remains a concern due to negative earnings. The company's strategic positioning and increased guidance provide a positive outlook.

Positive Factors

Revenue Growth

Strong revenue growth indicates effective market penetration and demand for services, supporting long-term financial stability and expansion.

Cash Flow Generation

Robust cash flow growth enhances financial flexibility, enabling strategic investments and debt reduction, crucial for sustainable growth.

Strategic Positioning

Strong strategic positioning allows Montrose to capitalize on industry trends, ensuring resilience and competitive advantage in the environmental sector.

Negative Factors

Profitability Challenges

Ongoing profitability issues could hinder reinvestment and growth, requiring focus on cost management and efficiency improvements.

Wind Down of Renewable Services

Exiting renewables limits diversification and growth in a key future market, potentially affecting long-term revenue and margin expansion.

Decline in Remediation and Reuse Segment

Margin decline in a core segment indicates operational challenges, necessitating strategic adjustments to maintain profitability.

Montrose Environmental Group Business Overview & Revenue Model

Company Description

Montrose Environmental Group, Inc. operates as an environmental services company in the United States. The company operates in three segments: Assessment, Permitting and Response; Measurement and Analysis; and Remediation and Reuse. The Assessment, Permitting and Response segment provides scientific advisory and consulting services to support environmental assessments, environmental emergency response and recovery, toxicology consulting and environmental audits and permits for current operations, facility upgrades, new projects, decommissioning projects, and development projects. Its technical advisory and consulting services include regulatory compliance support and planning, environmental, and ecosystem and toxicological assessments and support during responses to environmental disruptions. The Measurement and Analysis segment tests and analyzes air, water, and soil to determine concentrations of contaminants, as well as the toxicological impact of contaminants on flora, fauna, and human health. Its services include source and ambient air testing and monitoring, leak detection, and advanced analytical laboratory services, such as air, storm water, wastewater, and drinking water analysis. The Remediation and Reuse segment provides engineering, design, implementation, and operations and maintenance services primarily to treat contaminated water, remove contaminants from soil, or create biogas from waste. It serves technology, media, chemical, energy, power and utility, industrial and manufacturing, financial, and engineering industries, as well as local, state, provincial, and federal government entities. The company was founded in 2012 and is headquartered in North Little Rock, Arkansas.

How the Company Makes Money

Montrose Environmental Group generates revenue primarily through its diversified service offerings. Key revenue streams include consulting fees for environmental assessments, contracts for remediation projects, and ongoing monitoring services for compliance with environmental regulations. The company also earns income through partnerships with government agencies and private sector clients, which often result in multi-year contracts. Additionally, MEG leverages its expertise to provide specialized training and educational services, contributing further to its earnings. Overall, the company's ability to adapt to regulatory changes and invest in technological advancements plays a significant role in its financial success.

Montrose Environmental Group Financial Statement Overview

Summary

Montrose Environmental Group demonstrates positive revenue and cash flow growth with improved margins and reduced leverage. However, profitability challenges persist, as indicated by negative net income and return on equity. The balance sheet is strengthening, and cash flow metrics are robust, positioning the company well for future growth if profitability can be improved.

Income Statement

Montrose Environmental Group shows a positive revenue growth trend with a 5.92% increase in TTM. The gross profit margin has improved to 40.77% from 39.95% in the previous year, indicating efficient cost management. However, the company is still facing challenges with profitability, as evidenced by a negative net profit margin of -2.52% and negative EBIT margin. The EBITDA margin has improved to 8.55%, suggesting better operational efficiency.

Balance Sheet

The company's debt-to-equity ratio has significantly improved to 0.15 in TTM from 0.52 in the previous year, indicating a stronger balance sheet and reduced leverage. However, the return on equity remains negative at -7.50%, reflecting ongoing profitability challenges. The equity ratio is stable, suggesting a solid capital structure.

Cash Flow

Montrose Environmental Group has shown a strong free cash flow growth rate of 20.17% in TTM, indicating improved cash generation capabilities. The operating cash flow to net income ratio is 0.57, reflecting a healthy cash conversion. The free cash flow to net income ratio is robust at 0.84, suggesting efficient cash management despite negative net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	826.32M	696.39M	624.21M	544.42M	546.41M	328.24M
Gross Profit	336.88M	278.20M	240.31M	192.53M	177.38M	112.75M
EBITDA	70.84M	25.88M	31.93M	32.44M	40.96M	-6.00M
Net Income	-20.85M	-62.31M	-30.86M	-31.82M	-25.32M	-57.95M
Balance Sheet
Total Assets	985.68M	990.35M	816.79M	791.91M	833.09M	602.73M
Cash, Cash Equivalents and Short-Term Investments	7.84M	12.94M	23.24M	89.83M	146.74M	34.39M
Total Debt	369.63M	281.00M	210.34M	202.12M	205.77M	175.90M
Total Liabilities	526.96M	544.09M	495.53M	478.73M	516.59M	465.58M
Stockholders Equity	458.72M	446.26M	321.25M	313.19M	316.50M	137.15M
Cash Flow
Free Cash Flow	73.87M	902.00K	23.09M	10.65M	30.00M	-5.93M
Operating Cash Flow	87.50M	22.23M	56.02M	20.65M	37.58M	1.85M
Investing Cash Flow	-13.46M	-138.04M	-101.62M	-38.69M	-71.64M	-179.74M
Financing Cash Flow	-79.82M	106.00M	-20.11M	-38.76M	146.10M	205.90M

Montrose Environmental Group Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 26.13
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MEG, the sentiment is Positive. The current price of 26.13 is above the 20-day moving average (MA) of 26.00, below the 50-day MA of 26.22, and above the 200-day MA of 22.81, indicating a neutral trend. The MACD of 0.05 indicates Positive momentum. The RSI at 50.82 is Neutral, neither overbought nor oversold. The STOCH value of 16.19 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MEG.

Montrose Environmental Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MEG	69 Neutral	$923.37M	-27.61	-4.17%	―	22.77%	44.73%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
PESI	60 Neutral	$244.99M	-19.77	-23.26%	―	-9.64%	40.01%
NVRI	56 Neutral	$1.47B	-8.85	-38.53%	―	-2.91%	-67.18%
QRHC	51 Neutral	$43.83M	-1.84	-44.35%	―	-9.25%	-189.37%
LNZA	40 Underperform	$30.84M	-0.36	-696.09%	―	-31.28%	42.94%

Montrose Environmental Group Corporate Events

Montrose Environmental Reports Record Q3 2025 Results

Montrose Environmental Group reported record financial results for the third quarter and the first nine months of 2025, with significant revenue growth and improved net income compared to the previous year. The company increased its full-year 2025 guidance, expecting continued growth in revenue and Consolidated Adjusted EBITDA, driven by strong organic growth and operating leverage, while also providing a positive outlook for 2026.