Tutor Perini has surged 196% over the past year on robust backlog growth and cash flow generation, yet strong earnings guidance, analyst upgrades, and infrastructure tailwinds suggest potential for further gains amid risks like project delays and economic cycles.
Financial Performance
Tutor Perini has demonstrated a remarkable turnaround, shifting from past losses to profitability fueled by higher-margin projects. Third-quarter revenue climbed 31% year-over-year to $1.42 billion, driven by execution in civil and building segments. Operating cash flow hit $289 million for the quarter, contributing to $574 million over nine months, marking a record pace that supports debt reduction and balance sheet strengthening.
The company raised its full-year adjusted earnings per share guidance to $4.00-$4.20, reflecting confidence in ongoing momentum. Looking ahead, projections indicate even stronger earnings in subsequent years, with civil segment margins expected to reach 12-15% as legacy low-margin contracts phase out.
Backlog and Growth Prospects
| Key Financial Metrics | Value |
|---|---|
| Market Capitalization | $3.96B |
| Enterprise Value | $3.68B |
| Forward P/E Ratio | 14.73 |
| Price/Sales Ratio | 0.78 |
| Price/Book Ratio | 3.32 |
| Trailing Twelve-Month Revenue | $5.1B |
| Trailing Twelve-Month EBITDA | $147.72M |
| Operating Cash Flow (TTM) | $903.97M |
| Levered Free Cash Flow (TTM) | $753.45M |
| Total Cash (Most Recent Quarter) | $695.73M |
| Total Debt (Most Recent Quarter) | $473.03M |
A record backlog of $21.6 billion provides multi-year revenue visibility, up significantly from prior periods and bolstered by $2 billion in new awards and adjustments in the latest quarter. This pipeline, heavily weighted toward civil infrastructure at 49%, aligns with increased federal spending on transportation and public works.
Recent contract wins, including a $53 million change order for a Honolulu rail extension and a $35.8 million facility project, underscore demand in key areas like urban development and military infrastructure. Management anticipates sustained growth, with revenue estimates climbing to $5.38 billion for the current year and $6.22 billion next, representing over 15% expansion.
Valuation and Analyst Views
Trading near its 52-week high of $77, the stock’s forward metrics appear reasonable relative to peers in the construction sector, especially given the earnings inflection. Analysts maintain a strong buy consensus, with an average price target of $82, implying about 9% upside from current levels around $75. Some targets reach as high as $95, citing accelerating profitability and potential for shareholder returns like dividends or buybacks as cash accumulates.
Risks to Consider
Despite the rally, challenges persist in an industry prone to cost overruns and disputes. Economic slowdowns could impact project funding, while labor shortages or material inflation might pressure margins. The stock’s volatility, evident in its 52-week range from $18.34 to $77, highlights sensitivity to sector cycles and execution hurdles.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors should conduct their own research and consult with a qualified advisor before making investment decisions. The information presented is based on publicly available data and may contain errors.