TETRA TECH INC (TTEK) Stock Fundamental Analysis
NASDAQ:TTEK - Nasdaq - US88162G1031 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to TTEK. TTEK was compared to 84 industry peers in the Commercial Services & Supplies industry. TTEK has an excellent profitability rating, but there are some minor concerns on its financial health. TTEK has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year TTEK was profitable.
TTEK had a positive operating cash flow in the past year.
TTEK had positive earnings in each of the past 5 years.
TTEK had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 6.20%, TTEK is in the better half of the industry, outperforming 70.73% of the companies in the same industry.
TTEK has a better Return On Equity (15.32%) than 78.05% of its industry peers.
TTEK has a Return On Invested Capital of 12.86%. This is amongst the best in the industry. TTEK outperforms 82.93% of its industry peers.
TTEK had an Average Return On Invested Capital over the past 3 years of 12.29%. This is above the industry average of 10.12%.
The last Return On Invested Capital (12.86%) for TTEK is above the 3 year average (12.29%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.2% | ||
| ROE | 15.32% | ||
| ROIC | 12.86% |
ROA(3y)8.38%
ROA(5y)8.3%
ROE(3y)19.98%
ROE(5y)19.11%
ROIC(3y)12.29%
ROIC(5y)11.91%
1.3 Margins
With a decent Profit Margin value of 5.75%, TTEK is doing good in the industry, outperforming 69.51% of the companies in the same industry.
TTEK's Profit Margin has improved in the last couple of years.
TTEK has a better Operating Margin (11.86%) than 75.61% of its industry peers.
In the last couple of years the Operating Margin of TTEK has grown nicely.
Looking at the Gross Margin, with a value of 19.92%, TTEK is doing worse than 73.17% of the companies in the same industry.
TTEK's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.86% | ||
| PM (TTM) | 5.75% | ||
| GM | 19.92% |
OM growth 3Y2.48%
OM growth 5Y6.3%
PM growth 3Y-5.44%
PM growth 5Y3.04%
GM growth 3Y0.88%
GM growth 5Y3.25%
2. Health
2.1 Basic Checks
TTEK has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, TTEK has more shares outstanding
The number of shares outstanding for TTEK has been increased compared to 5 years ago.
The debt/assets ratio for TTEK has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.16 indicates that TTEK is not in any danger for bankruptcy at the moment.
TTEK has a better Altman-Z score (4.16) than 78.05% of its industry peers.
The Debt to FCF ratio of TTEK is 2.58, which is a good value as it means it would take TTEK, 2.58 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.58, TTEK is in the better half of the industry, outperforming 76.83% of the companies in the same industry.
TTEK has a Debt/Equity ratio of 0.53. This is a neutral value indicating TTEK is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.53, TTEK perfoms like the industry average, outperforming 47.56% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 2.58 | ||
| Altman-Z | 4.16 |
ROIC/WACC1.51
WACC8.49%
2.3 Liquidity
A Current Ratio of 1.29 indicates that TTEK should not have too much problems paying its short term obligations.
The Current ratio of TTEK (1.29) is worse than 65.85% of its industry peers.
A Quick Ratio of 1.29 indicates that TTEK should not have too much problems paying its short term obligations.
TTEK has a Quick ratio (1.29) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.29 |
3. Growth
3.1 Past
TTEK shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 18.09%, which is quite good.
Measured over the past years, TTEK shows a quite strong growth in Earnings Per Share. The EPS has been growing by 14.76% on average per year.
The Revenue has grown by 11.77% in the past year. This is quite good.
Measured over the past years, TTEK shows a quite strong growth in Revenue. The Revenue has been growing by 12.58% on average per year.
EPS 1Y (TTM)18.09%
EPS 3Y18.52%
EPS 5Y14.76%
EPS Q2Q%25%
Revenue 1Y (TTM)11.77%
Revenue growth 3Y19.19%
Revenue growth 5Y12.58%
Sales Q2Q%17.94%
3.2 Future
TTEK is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 13.88% yearly.
Based on estimates for the next years, TTEK will show a small growth in Revenue. The Revenue will grow by 6.03% on average per year.
EPS Next Y13.76%
EPS Next 2Y13.29%
EPS Next 3Y13.26%
EPS Next 5Y13.88%
Revenue Next Year4.8%
Revenue Next 2Y5.42%
Revenue Next 3Y8.79%
Revenue Next 5Y6.03%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 22.50 indicates a rather expensive valuation of TTEK.
TTEK's Price/Earnings ratio is a bit cheaper when compared to the industry. TTEK is cheaper than 64.63% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 29.63. TTEK is valued slightly cheaper when compared to this.
Based on the Price/Forward Earnings ratio of 18.48, the valuation of TTEK can be described as rather expensive.
TTEK's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. TTEK is cheaper than 69.51% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.68, TTEK is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.5 | ||
| Fwd PE | 18.48 |
4.2 Price Multiples
TTEK's Enterprise Value to EBITDA ratio is in line with the industry average.
TTEK's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.29 | ||
| EV/EBITDA | 14.34 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of TTEK may justify a higher PE ratio.
A more expensive valuation may be justified as TTEK's earnings are expected to grow with 13.26% in the coming years.
PEG (NY)1.64
PEG (5Y)1.52
EPS Next 2Y13.29%
EPS Next 3Y13.26%
5. Dividend
5.1 Amount
TTEK has a yearly dividend return of 0.75%, which is pretty low.
In the last 3 months the price of TTEK has falen by -26.93%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
TTEK's Dividend Yield is a higher than the industry average which is at 2.12.
With a Dividend Yield of 0.75, TTEK pays less dividend than the S&P500 average, which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
5.2 History
The dividend of TTEK decreases each year by -16.43%.
TTEK has been paying a dividend for at least 10 years, so it has a reliable track record.
TTEK has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)-16.43%
Div Incr Years10
Div Non Decr Years10
5.3 Sustainability
TTEK pays out 23.35% of its income as dividend. This is a sustainable payout ratio.
DP23.35%
EPS Next 2Y13.29%
EPS Next 3Y13.26%
29.93
-0.03 (-0.1%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners95.63%
Inst Owner Change4.37%
Ins Owners0.34%
Ins Owner Change0.61%
Market Cap8.02B
Analysts81.54
Price Target49.98 (66.99%)
Short Float %1.78%
Short Ratio1.68
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
Yearly Dividend0.22
Dividend Growth(5Y)-16.43%
DP23.35%
Div Incr Years10
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.28%
Min EPS beat(2)0.69%
Max EPS beat(2)3.88%
EPS beat(4)4
Avg EPS beat(4)3.23%
Min EPS beat(4)0.42%
Max EPS beat(4)7.92%
EPS beat(8)8
Avg EPS beat(8)6.84%
EPS beat(12)12
Avg EPS beat(12)6.53%
EPS beat(16)16
Avg EPS beat(16)6.83%
Revenue beat(2)1
Avg Revenue beat(2)2.73%
Min Revenue beat(2)-1.17%
Max Revenue beat(2)6.62%
Revenue beat(4)3
Avg Revenue beat(4)1.72%
Min Revenue beat(4)-1.17%
Max Revenue beat(4)6.62%
Revenue beat(8)7
Avg Revenue beat(8)6.4%
Revenue beat(12)11
Avg Revenue beat(12)4.86%
Revenue beat(16)14
Avg Revenue beat(16)3.93%
PT rev (1m)-2%
PT rev (3m)-4.42%
EPS NQ rev (1m)-5.21%
EPS NQ rev (3m)-81.99%
EPS NY rev (1m)-3.4%
EPS NY rev (3m)-6.04%
Revenue NQ rev (1m)-6.65%
Revenue NQ rev (3m)-6.24%
Revenue NY rev (1m)-2.76%
Revenue NY rev (3m)-3.05%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.5 | ||
| Fwd PE | 18.48 | ||
| P/S | 1.78 | ||
| P/FCF | 23.29 | ||
| P/OCF | 22.13 | ||
| P/B | 4.74 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.34 |
EPS(TTM)1.33
EY4.44%
EPS(NY)1.62
Fwd EY5.41%
FCF(TTM)1.28
FCFY4.29%
OCF(TTM)1.35
OCFY4.52%
SpS16.8
BVpS6.31
TBVpS-1.56
PEG (NY)1.64
PEG (5Y)1.52
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.2% | ||
| ROE | 15.32% | ||
| ROCE | 18.35% | ||
| ROIC | 12.86% | ||
| ROICexc | 14.06% | ||
| ROICexgc | 67.71% | ||
| OM | 11.86% | ||
| PM (TTM) | 5.75% | ||
| GM | 19.92% | ||
| FCFM | 7.65% |
ROA(3y)8.38%
ROA(5y)8.3%
ROE(3y)19.98%
ROE(5y)19.11%
ROIC(3y)12.29%
ROIC(5y)11.91%
ROICexc(3y)13.45%
ROICexc(5y)13.09%
ROICexgc(3y)67.51%
ROICexgc(5y)58.49%
ROCE(3y)17.54%
ROCE(5y)16.99%
ROICexcg growth 3Y12.34%
ROICexcg growth 5Y7.75%
ROICexc growth 3Y1.26%
ROICexc growth 5Y2.4%
OM growth 3Y2.48%
OM growth 5Y6.3%
PM growth 3Y-5.44%
PM growth 5Y3.04%
GM growth 3Y0.88%
GM growth 5Y3.25%
F-Score9
Asset Turnover1.08
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 2.58 | ||
| Debt/EBITDA | 1.47 | ||
| Cap/Depr | 25.78% | ||
| Cap/Sales | 0.4% | ||
| Interest Coverage | 17.03 | ||
| Cash Conversion | 59.96% | ||
| Profit Quality | 132.9% | ||
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.29 | ||
| Altman-Z | 4.16 |
F-Score9
WACC8.49%
ROIC/WACC1.51
Cap/Depr(3y)35.94%
Cap/Depr(5y)38.71%
Cap/Sales(3y)0.5%
Cap/Sales(5y)0.47%
Profit Quality(3y)116.94%
Profit Quality(5y)124.37%
High Growth Momentum
Growth
EPS 1Y (TTM)18.09%
EPS 3Y18.52%
EPS 5Y14.76%
EPS Q2Q%25%
EPS Next Y13.76%
EPS Next 2Y13.29%
EPS Next 3Y13.26%
EPS Next 5Y13.88%
Revenue 1Y (TTM)11.77%
Revenue growth 3Y19.19%
Revenue growth 5Y12.58%
Sales Q2Q%17.94%
Revenue Next Year4.8%
Revenue Next 2Y5.42%
Revenue Next 3Y8.79%
Revenue Next 5Y6.03%
EBIT growth 1Y26.34%
EBIT growth 3Y22.14%
EBIT growth 5Y19.68%
EBIT Next Year22.86%
EBIT Next 3Y17.25%
EBIT Next 5Y13.25%
FCF growth 1Y30.02%
FCF growth 3Y4.81%
FCF growth 5Y12.11%
OCF growth 1Y29.94%
OCF growth 3Y5.62%
OCF growth 5Y11.46%