Tetra Tech (TTEK) AI Stock Analysis

• Market Cap: $9.50B
• Dividend Yield: 0.72%
• Average Volume (3M): 2.37M
• Price to Earnings (P/E): 51.9
• Beta (1Y): 0.48
• Revenue Growth: 10.35%
• EPS Growth: -29.34%
• Country: US
• Employees: 30,000
• Sector: Industrials
• Sector Strength: 87
• Industry: Engineering & Construction
• EPS (TTM): 0.33
• Shares Outstanding: 263,502,620
• 10 Day Avg. Volume: 1,933,630
• 30 Day Avg. Volume: 2,366,614
• PEG Ratio: 1.87
• Price to Book (P/B): 5.81
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 21.13
• Enterprise Value/Market Cap: 0.75
• Enterprise Value/Revenue: 0.34
• Enterprise Value/Gross Profit: 7.92
• Enterprise Value/Ebitda: 3.51
• 1Y Price Target: $42.33
• Price Target Upside: 17.39% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 71 Outperform
• Price Target: $39.00 ▲(8.15%Upside)

Tetra Tech's overall stock score reflects strong financial performance and promising earnings guidance. Key strengths include robust revenue growth and strategic acquisitions. However, high P/E ratio and technical indicators suggesting overbought conditions are concerns. Challenges such as increased debt levels and market-specific issues in Australia also weigh on the score.

Positive Factors

Acquisitions and Strategic Moves

Tetra Tech announced acquisitions to increase work in the life science and public sectors in Europe and automation solutions in municipal water and industrial sectors.

Disaster Response and Recovery Projects

TTEK reported F2Q25 results above expectations due to disaster response work related to California fires and remaining hurricane damage remediation work in the Southeast U.S.

Guidance and Revenue Growth

Management reaffirmed its long-term organic revenue growth rate target of 6%-10% remains intact.

Negative Factors

Federal Contract Reductions

Canceled U.S. federal government contracts, particularly for USAID projects, led to a 20.8% decline in backlog.

Reduced Government Work and Competition

A smaller opportunity set for U.S. federal government contracts is expected, with Tetra Tech and other contractors competing for fewer projects.

Stock Price Volatility

Shares will remain volatile with a daily deluge of fresh information.

Tetra Tech Business Overview & Revenue Model

Company Description

Tetra Tech, Inc. provides consulting and engineering services worldwide. The company operates through two segments Government Services Group (GSG) and Commercial/International Services Group (CIG). The GSG segment offers early data collection and monitoring, data analysis and information management, science and engineering applied research, engineering design, project management, and operations and maintenance services; and climate change and energy management consulting, as well as greenhouse gas inventory assessment, certification, reduction, and management services. This segment serves federal, state, and local governments, and development agencies in water resources analysis and water management, environmental monitoring, data analytics, government consulting, waste management, and a range of civil infrastructure master planning and engineering design markets. The CIG segment provides early data collection and monitoring, data analysis and information management, feasibility studies and assessments, science and engineering applied research, engineering design, project management, and operations and maintenance services. This segment serves natural resources, energy, and utilities markets, as well as sustainable infrastructure master planning and engineering design markets. Tetra Tech, Inc. was founded in 1966 and is headquartered in Pasadena, California.

How the Company Makes Money

Tetra Tech makes money through a diversified revenue model primarily based on providing engineering and consulting services. The company's key revenue streams include government contracts, where it offers technical and management solutions to federal, state, and local agencies; commercial clients, including utilities and industrial firms that require specialized engineering expertise; and international development projects funded by organizations like the United Nations and the World Bank. Significant partnerships with governmental bodies and large corporations, along with a focus on sustainability and innovative solutions, contribute to Tetra Tech's earnings. The company's financial performance is also bolstered by its ability to secure long-term contracts and its strategic acquisitions to expand service offerings and market reach.

Tetra Tech Financial Statement Overview

Summary

Tetra Tech demonstrates robust revenue growth and effective equity utilization, though operational margins suggest areas for improvement. The increase in debt levels could pose risks if not managed carefully. Cash flow performance is solid, reflecting strong cash generation capabilities. Overall, the company maintains a healthy financial position despite operational challenges.

Income Statement

Tetra Tech has shown consistent revenue growth over the years, with a notable increase in Total Revenue from $2.99 billion in 2020 to $5.46 billion in TTM (Trailing-Twelve-Months). Gross Profit Margin in TTM is approximately 16.55%, and Net Profit Margin is 4.38%. However, a decreasing EBIT Margin from 9.64% in 2024 to 6.12% in TTM suggests some pressure on operational efficiency.

Balance Sheet

The company's Debt-to-Equity Ratio has increased from 0.45 in 2020 to 0.78 in TTM, indicating a higher reliance on debt financing. However, the Return on Equity (ROE) remains strong at 15.22% in TTM, showcasing effective utilization of equity. The Equity Ratio has decreased, indicating a modest decline in financial leverage stability.

Cash Flow

Free Cash Flow showed a positive trend with $233.72 million in TTM, although it decreased from $340.57 million in 2024. The Operating Cash Flow to Net Income Ratio is 1.06, suggesting good cash generation relative to net income. The Free Cash Flow to Net Income Ratio of 0.98 in TTM indicates efficient cash conversion.

Breakdown
TTM	Sep 2024	Dec 2023	Dec 2022	Dec 2021	Sep 2020
Income Statement		Total Revenue
5.46B	5.20B	4.52B	3.50B	3.21B	2.99B
	Gross Profit
904.11M	866.44M	725.03M	575.56M	498.40M	446.54M
	EBIT
334.10M	500.74M	358.11M	340.45M	278.70M	241.09M
	EBITDA
396.33M	584.09M	481.23M	368.01M	299.23M	263.04M
	Net Income Common Stockholders
239.52M	333.38M	273.42M	263.13M	232.81M	173.86M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
179.43M	232.69M	168.83M	185.09M	166.57M	157.51M
	Total Assets
4.18B	4.19B	3.82B	2.62B	2.58B	2.38B
	Total Debt
1.22B	1.02B	1.09B	462.90M	454.24M	553.26M
	Net Debt
1.04B	783.46M	920.39M	277.81M	287.67M	395.75M
	Total Liabilities
2.61B	2.36B	2.42B	1.44B	1.34B	1.34B
	Stockholders Equity
1.57B	1.83B	1.40B	1.18B	1.23B	1.04B
Cash Flow		Free Cash Flow
233.72M	340.57M	341.56M	325.61M	295.80M	250.23M
	Operating Cash Flow
253.77M	358.71M	368.46M	336.19M	304.37M	262.48M
	Investing Cash Flow
-44.65M	-111.04M	-771.20M	-55.74M	-92.99M	-63.02M
	Financing Cash Flow
-234.45M	-191.38M	382.38M	-249.61M	-210.10M	-163.05M

Tetra Tech Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 36.06
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Negative

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 36.06 is above the 20-day moving average (MA) of 35.42, above the 50-day MA of 32.89, and below the 200-day MA of 38.42, indicating a neutral trend. The MACD of 0.74 indicates Positive momentum. The RSI at 64.40 is Neutral, neither overbought nor oversold. The STOCH value of 86.36 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TTEK.

Tetra Tech Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVEE	80 Outperform	$1.50B	46.80	3.79%	―	8.65%	-22.72%
ACM	80 Outperform	$14.82B	24.43	28.07%	0.93%	4.55%	―
KBR	74 Outperform	$6.94B	17.86	28.18%	1.23%	12.84%	―
TTEK	71 Outperform	$9.50B	51.93	11.91%	0.72%	10.35%	-29.34%
J	71 Outperform	$15.10B	34.72	8.46%	1.02%	-22.81%	-30.13%
FLR	70 Outperform	$7.95B	4.62	66.58%	―	7.16%	523.56%
Sector *	66 Neutral	$4.47B	12.22	5.40%	3.65%	4.14%	-12.00%

Tetra Tech Corporate Events

Tetra Tech Enhances Credit Agreement and Raises Dividend

On May 5, 2025, Tetra Tech entered a Fourth Amended and Restated Credit Agreement, enhancing its financial flexibility with a $1.5 billion borrowing capacity. This agreement includes a $250 million senior secured term loan facility and a $600 million revolving credit facility, with provisions for additional commitments. Tetra Tech also reported strong second-quarter results with record revenues and net income, despite challenges from the reorganization of USAID. The company increased its quarterly dividend by 12% and expanded its stock buyback program by $500 million, reflecting confidence in its financial position and growth prospects. Additionally, Tetra Tech announced strategic acquisitions to expand its global digital technology and program management businesses, raising its FY25 guidance for net revenue and EPS.