Blog

• Tetra Tech, Inc. recently announced record financial results for the fourth quarter of fiscal 2025, reporting quarterly sales of US$1,330.1 million and net income of US$127.75 million, along with the declaration of a quarterly dividend of US$0.065 per share payable on December 12, 2025.

• Management highlighted a robust backlog of US$4.14 billion and strong demand for water and environmental services, underpinned by large new contract wins and guidance anticipating further earnings growth in 2026 despite sector funding shifts.

• We’ll explore how Tetra Tech’s record operating margins and backlog expansion could reshape the company’s investment narrative for long-term investors.

The latest GPUs need a type of rare earth metal called Neodymium and there are only 37 companies in the world exploring or producing it. Find the list for free.

For investors considering Tetra Tech, the core thesis centers on the company’s ability to maintain strong earnings growth and margin expansion as it shifts focus to high-value water and environmental services contracts. The most recent record quarterly results and robust backlog reinforce the short-term catalyst of high-margin government service wins, but do little to address the growing risk around revenue concentration and the uncertainties created by lapsed USAID and Department of State contracts.

Among the latest announcements, the $249 million contract award from the U.S. Army Corps of Engineers stands out as directly supporting future backlog and near-term revenue, tying in closely to the key catalyst of government infrastructure spending highlighted in company guidance. This new pipeline helps offset concerns about lower contributions from previous episodic disaster response work.

However, investors should not overlook that, while government contract wins support revenue visibility, the company still faces the risk that shifts in federal funding priorities could result in…

Read the full narrative on Tetra Tech (it’s free!)

Tetra Tech’s narrative projects $4.7 billion in revenue and $559.6 million in earnings by 2028. This requires a 0.8% annual revenue decline and a $343.5 million earnings increase from current earnings of $216.1 million.

Uncover how Tetra Tech’s forecasts yield a $42.60 fair value, a 18% upside to its current price.

Four individual fair value estimates from the Simply Wall St Community range from US$23.16 to US$42.60 per share. Despite renewed optimism from recent federal contract wins, some see continued risk around margin volatility and revenue concentration that could shape long-term outlooks.

Explore 4 other fair value estimates on Tetra Tech – why the stock might be worth 36% less than the current price!

Disagree with existing narratives? Create your own in under 3 minutes – extraordinary investment returns rarely come from following the herd.

These stocks are moving-our analysis flagged them today. Act fast before the price catches up:

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include TTEK.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com