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Why Is ICF (ICFI) Up 5.1% Since Last Earnings Report?
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It has been about a month since the last earnings report for ICF International (ICFI - Free Report) . Shares have added about 5.1% in that time frame, underperforming 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 its most recent earnings report in order to get a better handle on the important catalysts.
ICF International Surpasses Q1 Earnings and Revenues
ICF International reported impressive first-quarter 2020 numbers, with both earnings and revenues beating the Zacks Consensus Estimate.
Non-GAAP EPS of 83 cents surpassed the consensus mark by 9.2% but declined 4.6% on a year-over-year basis. Revenues of $358.2 million marginally beat the consensus mark and increased 5% year over year.
The company stated that the coronavirus pandemic did not have a significant impact on its quarterly performance. Notably, it has business-continuity plans in place and shifted more than 98% of its employees to work from home.
Revenues in Detail
Revenues from government clients came in at $239.8 million and improved 6.5% year over year. The U.S. federal government revenues of $155.4 million increased 17.6% year over year and contributed 44% to total revenues. The U.S. state and local government revenues of $61.3 million decreased 7% year over year and contributed 17% to total revenues. International government revenues of $23.1 million were down 14.8% year over year, contributing 6% to total revenues.
Commercial revenues totaled $118.4 million, up 2% from the year-ago quarter’s figure and contributed 33% to total revenues. Energy markets and marketing services contributed 47% and 43%, respectively, to commercial revenues.
Backlog and Value of Contracts
Total backlog and funded backlog amounted to $2.7 billion and $1.3 billion at the end of the first quarter, respectively. The total value of contracts awarded in the quarter came in at $356.9 million, up 23.4%.
Operational Results
Adjusted EBITDA was $28 million, down 1.8% from the year-ago quarter’s figure. Adjusted EBITDA margin of 7.8% shrunk 50 basis points (bps) year over year. Adjusted EBITDA margin on service revenues was 8.3%, down 90 bps year over year.
Balance Sheet
ICF exited the March-end quarter with cash and cash equivalent balance of $58.7 million compared with the $6.5 million recorded at the end of the previous quarter. The company had a long-term debt of $507 million compared with the $164.3 million witnessed at the end of the prior quarter.
The company used $15.2 million of cash from operating activities, and capex was $4.7 million. ICF paid out dividends of $2.6 million in the reported quarter.
2020 Guidance
Management lowered its revenue expectation to $1.45-$1.51 billion from the $1.6-$1.65 billion anticipated previously. The company lowered the EPS range from the $4- $4.3 guided earlier to $3.5-3.8. EBITDA is expected to be $126-$136 million compared with the prior estimate of $145-$155 million. Operating cash flow is anticipated to be around $110 million compared with the previous expectation of $120 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -22.1% due to these changes.
VGM Scores
Currently, ICF has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise ICF has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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Why Is ICF (ICFI) Up 5.1% Since Last Earnings Report?
It has been about a month since the last earnings report for ICF International (ICFI - Free Report) . Shares have added about 5.1% in that time frame, underperforming 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 its most recent earnings report in order to get a better handle on the important catalysts.
ICF International Surpasses Q1 Earnings and Revenues
ICF International reported impressive first-quarter 2020 numbers, with both earnings and revenues beating the Zacks Consensus Estimate.
Non-GAAP EPS of 83 cents surpassed the consensus mark by 9.2% but declined 4.6% on a year-over-year basis. Revenues of $358.2 million marginally beat the consensus mark and increased 5% year over year.
The company stated that the coronavirus pandemic did not have a significant impact on its quarterly performance. Notably, it has business-continuity plans in place and shifted more than 98% of its employees to work from home.
Revenues in Detail
Revenues from government clients came in at $239.8 million and improved 6.5% year over year. The U.S. federal government revenues of $155.4 million increased 17.6% year over year and contributed 44% to total revenues. The U.S. state and local government revenues of $61.3 million decreased 7% year over year and contributed 17% to total revenues. International government revenues of $23.1 million were down 14.8% year over year, contributing 6% to total revenues.
Commercial revenues totaled $118.4 million, up 2% from the year-ago quarter’s figure and contributed 33% to total revenues. Energy markets and marketing services contributed 47% and 43%, respectively, to commercial revenues.
Backlog and Value of Contracts
Total backlog and funded backlog amounted to $2.7 billion and $1.3 billion at the end of the first quarter, respectively. The total value of contracts awarded in the quarter came in at $356.9 million, up 23.4%.
Operational Results
Adjusted EBITDA was $28 million, down 1.8% from the year-ago quarter’s figure. Adjusted EBITDA margin of 7.8% shrunk 50 basis points (bps) year over year. Adjusted EBITDA margin on service revenues was 8.3%, down 90 bps year over year.
Balance Sheet
ICF exited the March-end quarter with cash and cash equivalent balance of $58.7 million compared with the $6.5 million recorded at the end of the previous quarter. The company had a long-term debt of $507 million compared with the $164.3 million witnessed at the end of the prior quarter.
The company used $15.2 million of cash from operating activities, and capex was $4.7 million. ICF paid out dividends of $2.6 million in the reported quarter.
2020 Guidance
Management lowered its revenue expectation to $1.45-$1.51 billion from the $1.6-$1.65 billion anticipated previously. The company lowered the EPS range from the $4- $4.3 guided earlier to $3.5-3.8. EBITDA is expected to be $126-$136 million compared with the prior estimate of $145-$155 million. Operating cash flow is anticipated to be around $110 million compared with the previous expectation of $120 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -22.1% due to these changes.
VGM Scores
Currently, ICF has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise ICF has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.