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CRA International (CRAI) Q3 Earnings Top, Revenue View Up

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CRA International Inc. reported solid third-quarter 2018 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate.

Non-GAAP earnings of 65 cents per share outpaced the consensus mark by 13 cents and increased 58.5% year over year. Revenues came in at $103.9 million, which came ahead of the consensus estimate by $4.5 million and increased 13.7% year over year on an entirely organic basis. On a constant-currency basis, the top line rose $0.2 million year over year.

Notably, the company reported double-digit year-over-year revenue growth in each of the trailing eight quarters. During the quarter, CRA International achieved company-wide utilization of 76% and headcounts increase of 7.2% year over year.

In a year’s time, shares of CRA International have gained 1.3% compared with 12.5% rise of the industry it belongs to.

Quarter Details

In terms of services offered, both legal and regulatory as well as management consulting delivered solid results. This impressive performance can be attributed to double-digit year-over-year growth in Antitrust & Competition Economics, Forensic Services, Finance, Labor & Employment and Life Sciences practices. Geographically, revenues from North America and international operations grew 13% and 15% year over year, respectively.

CRA International,Inc. Revenue (TTM)

In the reported quarter, non-GAAP EBITDA increased 17.7% year over year to $10.1 million. Non-GAAP EBITDA margin expanded 30 basis points (bps) year over year to 9.7%.

CRA International exited the third quarter with cash and cash equivalents of $11.9 million compared with $9 million at the end of the prior quarter. Notably, the company used $8.4 million of cash in operating activities and spent 13.4 million in Capex in the first nine months of 2018.

Dividend

In the quarter, CRA International paid dividends of $1.4 million. Concurrent with the earnings release on Nov 1, 2018, the board of directors announced an 18% increase in its quarterly cash dividend to $0.20 per common share, payable Dec 21, 2018 to its shareholders of record as of Nov 27, 2018.

2018 Guidance

Backed by impressive top-line performance in the first three quarters of 2018, CRA International raised its 2018 revenue guidance on a constant-currency basis relative to fiscal 2017. The company now expects revenues in the range of $404-$410 million compared with $398-$406 million projected earlier.

The company expects non-GAAP EBITDA margin to lie in the upper half of the previously announced guidance range of 8.8-9.8%.

Zacks Rank & Upcoming Releases

CRA International currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Investors interested in the broader Business Services sector are keenly awaiting upcoming quarterly releases from Genpact Limited (G - Free Report) , Broadridge Financial Solutions, Inc. (BR - Free Report) and Delphi Technologies PLC (DLPH - Free Report) . While Genpact and Broadridge will release results on Nov 6, Delphi will announce the same on Nov 7.

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