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Here's Why Investors Should Consider Investing in Tetra Tech Stock

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Key Takeaways

  • TTEK is seeing strong orders across the U.S. and international sectors, boosting key segment revenues.
  • Recent acquisitions expand TTEK's reach in the water, energy, automation and federal IT markets.
  • TTEK expects FY25 revenues of $4.400-$4.765B, up from $4.322B in FY24.

Tetra Tech, Inc. (TTEK - Free Report) is well-positioned for growth courtesy of strength across its end markets, strategic acquisitions and focus on operational excellence. The company remains focused on investing in growth opportunities and solidifying its long-term market position.

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It has a market capitalization of $9.5 billion. Over the past three months, it has gained 22.4% compared with the industry’s growth of 7.1%. TTEK currently carries a Zacks Rank #2 (Buy).

Let’s delve into the factors that have been aiding the firm for a while now.

Business Strength: The company is witnessing strong orders from the U.S. Federal, U.S. State & Local, U.S. Commercial and International client sectors. Its Government Services Group segment is benefiting from a solid pipeline of advanced water treatment projects, disaster response programs and strength in the federal sector. Net sales from the segment increased 23.4% year over year in the first six months of fiscal 2025 (ended March 31, 2024). 

Also, strong project performance in international operations and the RPS acquisition are aiding the CIG segment. Revenues from the segment increased 1.8% year over year in the first six months of fiscal 2025.

Acquisition Benefits: Tetra Tech remains focused on acquiring businesses to gain access to new customers, regions and product lines. In May 2024, TTEK acquired Convergence Controls & Engineering, a systems integration and engineering services company. This acquisition enabled Tetra Tech to offer a comprehensive line of integrated automation platform solutions to its clients across the water and energy sectors.

The acquisition of LS Technologies (in February 2024) introduced additional capabilities and clients to its federal IT practice within its Government Services Group segment. Also, the RPS Group buyout (in January 2023) expanded TTEK’s water practice in the United Kingdom and strengthened its foothold in renewable energy and environmental management.

The company also entered into a deal to acquire SAGE Group Holdings in May 2025, a provider of automation solutions with expertise. The buyout will enable Tetra Tech to boost its digital automation solutions across municipal water and industrial manufacturing automation, systems integration and smart infrastructure verticals.

Shareholder-Friendly Policies: Tetra Tech remains committed to rewarding its shareholders through dividend payouts. For instance, in the first six months of fiscal 2025, it paid out dividends of $30.9 million, up 11.2% year over year. In fiscal 2024 (ended September 2024), the company distributed dividends totaling $58.8 million, up 12.9%. Also, it hiked the quarterly dividend rate by 12% in July 2024.

Bullish Guidance: Driven by strength across its business, management has issued a bullish revenue guidance for fiscal 2025 (ending Sept. 30, 2025). Tetra Tech expects revenues in the range of $4.400-$4.765 billion, suggesting an increase from $4.322 billion reported in fiscal 2024.

Other Stocks to Consider

Some other top-ranked companies are discussed below.

Howmet Aerospace (HWM - Free Report) currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

HWM delivered a trailing four-quarter average earnings surprise of 8.8%. In the past 60 days, the consensus estimate for Howmet’s 2025 earnings has increased 6.5%.

Federal Signal Corporation (FSS - Free Report) currently carries a Zacks Rank of 2. FSS delivered a trailing four-quarter average earnings surprise of 6.4%. In the past 60 days, the Zacks Consensus Estimate for Federal Signal’s 2025 earnings has increased 1.6%.

AptarGroup, Inc. (ATR - Free Report) presently carries a Zacks Rank of 2. ATR delivered a trailing four-quarter average earnings surprise of 7.3%. In the past 60 days, the consensus estimate for AptarGroup’s 2025 earnings has increased 5.4%.

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