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Tetra Tech
(NASDAQ:TTEK)
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Rating:74Outperform
Price Target:
$38.00
▲(19.84% Upside)
Action:Reiterated
Date:07/30/26
The score is driven primarily by solid financial performance and a strong, guidance-raising earnings call (cash flow strength, backlog growth, and margin expansion). Technicals are supportive with price above key moving averages, while valuation is a modest offset due to a mid-range P/E and low dividend yield.
Positive Factors
Strong cash generation
Tetra Tech converts nearly all reported earnings into cash (FCF ~97% of net income) and generated record operating cash flow, creating durable internal funding for capex, acquisitions, buybacks, and dividends. Strong cash conversion supports financial flexibility across cycles and underpins capital returns and reinvestment.
Negative Factors
Federal procurement bottlenecks
Delayed federal award timing and constrained task order flow reduce near-term revenue visibility for a business with material government exposure. Prolonged procurement bottlenecks can shift project starts, depress utilization and create lumpiness in reported revenue and cash timing over quarters, increasing execution risk.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Tetra Tech converts nearly all reported earnings into cash (FCF ~97% of net income) and generated record operating cash flow, creating durable internal funding for capex, acquisitions, buybacks, and dividends. Strong cash conversion supports financial flexibility across cycles and underpins capital returns and reinvestment.
Read all positive factors
Tetra Tech (TTEK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$8.61B
Dividend Yield0.81%
Average Volume (3M)3.07M
Price to Earnings (P/E)19.9
Beta (1Y)0.39
Revenue Growth-7.61%
EPS Growth105.41%
CountryUS
Employees25,000
SectorIndustrials
Sector Strength72
IndustryEngineering & Construction
Share Statistics
EPS (TTM)1.67
Shares Outstanding259,524,700
10 Day Avg. Volume2,248,798
30 Day Avg. Volume3,074,167
Financial Highlights & Ratios
PEG Ratio-1.44
Price to Book (P/B)5.00
Price to Sales (P/S)1.64
P/FCF Ratio20.28
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$41.00Price Target Upside29.30% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
EPS Forecast (FY)1.57
Revenue Forecast (FY)$4.35B
Tetra Tech Business Overview & Revenue Model
Company Description
Tetra Tech, Inc. operates as a global provider of specialized consulting and engineering services. The firm organizes its activities into two primary divisions: the Government Services Group (GSG) and the Commercial/International Services Group (C...
How the Company Makes Money
Tetra Tech makes money primarily by providing professional services under contracts for consulting, engineering, and program delivery. Revenue is generated from fees billed for labor (time-and-materials and labor-hour arrangements), project delive...
Tetra Tech Earnings Call Summary
Earnings Call Date:Jul 29, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Nov 18, 2026
Earnings Call Sentiment Positive
The call presented a broadly positive operational and financial picture: strong Q3 revenue and EPS beats, record-to-date operating cash flow, sequential backlog growth, double-digit growth in several geographies, margin expansion, reduced leverage and active capital returns (dividends and buybacks). Challenges remain around constrained U.S. federal procurement, renewables cancellations (offshore wind), uncertainty in some international aid-related work, and localized funding shortfalls (flood protection). On balance, the strengths — including raised FY26 guidance, improving margins and robust cash generation — materially outweigh the headwinds.Positive Updates
Quarterly Revenue and EPS Beat
Net revenue of $1.1 billion in Q3, exceeding the upper end of guidance; adjusted EPS of $0.42 also exceeded the upper end of guidance.
Negative Updates
Federal Procurement and Contracting Headwinds
U.S. federal awards and task order flow remain constrained by reduced contracting office staffing and lingering effects from the prior year government shutdown, creating bottlenecks and slower order placement.
Read all updates
Q3-2026 Updates
Positive
Negative
Quarterly Revenue and EPS Beat
Net revenue of $1.1 billion in Q3, exceeding the upper end of guidance; adjusted EPS of $0.42 also exceeded the upper end of guidance.
Read all positive updates
Company Guidance
Management raised guidance, calling for Q4 net revenue of $1.12–$1.17 billion and adjusted EPS of $0.45–$0.48, and lifting full‑year FY2026 net revenue to $4.315–$4.365 billion with adjusted EPS of $1.56–$1.59 (midpoint implies ~8% revenue growth year‑over‑year and ~70 bps margin expansion); guidance assumptions include $34M of intangible amortization, $23M of depreciation, $30M of interest expense, a 27.3% effective tax rate, and excludes contributions from future acquisitions. This raise followed Q3 outperformance (Q3 revenue $1.1B, EPS $0.42, operating cash flow $229M; YTD operating cash flow $467M), backlog up ~$208M sequentially to just under $4.5B, and strong operating metrics cited as underpinning the outlook (DSO 56 days, net leverage ~0.88x, ROCE >20%), alongside continued capital returns (Q3 buybacks $100M; YTD buybacks $200M; dividend +11% YoY).Tetra Tech Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
74
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.07B | 5.44B | 5.20B | 4.52B | 2.84B | 3.21B |
| Gross Profit | 951.81M | 961.34M | 866.44M | 725.03M | 575.56M | 498.40M |
| EBITDA | 667.08M | 476.53M | 581.70M | 514.62M | 367.81M | 303.42M |
| Net Income | 436.17M | 247.72M | 333.38M | 273.42M | 263.13M | 232.81M |
Balance Sheet | ||||||
| Total Assets | 4.39B | 4.28B | 4.19B | 3.82B | 2.62B | 2.58B |
| Cash, Cash Equivalents and Short-Term Investments | 230.84M | 167.46M | 232.69M | 168.83M | 185.09M | 166.57M |
| Total Debt | 1.02B | 987.16M | 1.02B | 1.09B | 462.90M | 454.24M |
| Total Liabilities | 2.54B | 2.50B | 2.36B | 2.42B | 1.44B | 1.34B |
| Stockholders Equity | 1.85B | 1.78B | 1.83B | 1.40B | 1.18B | 1.23B |
Cash Flow | ||||||
| Free Cash Flow | 548.21M | 439.05M | 340.57M | 341.56M | 325.61M | 295.80M |
| Operating Cash Flow | 567.40M | 457.69M | 358.71M | 368.46M | 336.19M | 304.37M |
| Investing Cash Flow | -164.04M | -106.75M | -111.04M | -771.20M | -55.74M | -92.99M |
| Financing Cash Flow | -415.29M | -410.24M | -191.38M | 382.38M | -249.61M | -210.10M |
Tetra Tech Technical Analysis
Positive
31.71
Price Trends
29.75
Positive
30.11
Positive
32.54
Positive
Market Momentum
1.15
Negative
71.03
Negative
77.93
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TTEK, the sentiment is Positive. The current price of 31.71 is below the 20-day moving average (MA) of 31.93, above the 50-day MA of 29.75, and below the 200-day MA of 32.54, indicating a bullish trend. The MACD of 1.15 indicates Negative momentum. The RSI at 71.03 is Negative, neither overbought nor oversold. The STOCH value of 77.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TTEK.
Tetra Tech Risk Analysis
Tetra Tech disclosed 52 risk factors in its most recent earnings report. Tetra Tech reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Tetra Tech Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $8.61B | 19.86 | 23.76% | 0.84% | -7.61% | 105.41% | |
73 Outperform | $18.31B | 52.67 | 32.77% | ― | 36.96% | 31.00% | |
70 Outperform | $4.62B | 11.03 | 26.57% | 1.79% | -4.37% | 13.37% | |
67 Neutral | $12.04B | 37.77 | 18.85% | ― | 29.76% | 33.40% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
58 Neutral | $4.58B | 18.39 | 15.21% | 0.37% | 13.40% | 19.67% | |
51 Neutral | $7.01B | 24.35 | 8.12% | ― | -8.32% | -87.53% |
* Industrials Sector Average
TTEK
Tetra Tech
35.03
-2.04
-5.51%
DY
Dycom
415.08
147.32
55.02%
FLR
Fluor
51.54
10.29
24.95%
KBR
KBR
37.83
-11.02
-22.56%
PRIM
Primoris Services
90.85
-17.45
-16.11%
STRL
Sterling Infrastructure
541.62
245.04
82.62%
Tetra Tech Corporate Events
Business Operations and StrategyStock BuybackDividendsFinancial Disclosures
Tetra Tech Boosts Guidance Amid Strong Q3 Performance
Positive
Jul 29, 2026
For the third quarter ended June 28, 2026, Tetra Tech delivered revenue of $1.31 billion and net revenue of $1.11 billion, with net revenue up 8% year over year excluding certain government and disaster response work. Operating income reached $158...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.