It has been about a month since the last earnings report for ICF International (ICFI Quick QuoteICFI - Free Report) . Shares have added about 4.2% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is ICF due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

ICF International Q4 Earnings Top Estimates

ICF International delivered impressive fourth-quarter 2020 results, with earnings and revenues beating the Zacks Consensus Estimate.

Non-GAAP earnings (excluding 69 cents from non-recurring items) of $1.36 per share surpassed the Zacks Consensus Estimate by 19.3% and increased 15.3% on a year-over-year basis. Moreover, revenues of $434.3 million surpassed the consensus mark by 9% and increased 9.5% year over year owing to increase in service revenues.

Revenues in Detail

Revenues from government clients came in at $251.5 million, up 3% on a year-over-year basis. The U.S. federal government revenues of $165.5 million increased 18.9% year over year and contributed 38% to total revenues. The U.S. state and local government revenues of $51.7 million declined 25.6% year over year and contributed 12% to total revenues. International government revenues of $34.4 million were down 2.8% year over year, contributing 8% to total revenues.

Commercial revenues totaled $182.8 million, up 20% from the year-ago quarter’s figure and contributed 42% to total revenues. Energy markets and marketing services contributed 36% and 59%, respectively, to commercial revenues.

Backlog and Value of Contracts

Total backlog and funded backlog amounted to $2.9 billion and $1.5 billion at the end of the fourth quarter, respectively. The total value of contracts awarded in the quarter came in at $525 million.

Operational Results

Adjusted EBITDA of $44.9 million, increased 20.1% from the year-ago quarter’s figure. Adjusted EBITDA margin on revenues of 10.3% increased 90 basis points (bps) year over year. Adjusted EBITDA margin on service revenues was 17.1%, up 220 bps year over year.

Balance Sheet

ICF exited the fourth quarter with cash and cash equivalent balance of $13.8 million compared with the $8.2 million recorded at the end of the previous quarter. The company had a long-term debt of $303.2 million compared with $362.3 million at the end of the prior quarter.

The company generated $78 million of cash from operating activities and capex was $4.7 million. ICF paid out dividends of $2.6 million in the reported quarter.

Dividend Declared

ICF announced a quarterly cash dividend of 14 cents per share, payable to its shareholders on Apr 13, 2021 as of record date Mar 26.

2021 Guidance

ICF reported non-GAAP diluted earnings per share (EPS) guidance to $4.35-$4.65.

Revenues are projected in the range of $1.52-$1.57 billion.

EBITDA is expected to be in the range of $145 million and $155 million. Operating cash flow is anticipated to be approximately $100 million.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates.

VGM Scores

At this time, ICF has a strong Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of this revision indicates a downward shift. Notably, ICF has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.