Exponent Inc (NASDAQ: EXPO)

Sector: Industrials Industry: Engineering & Construction CIK: 0000851520
P/B 9.35
P/E 35.92
P/S 6.59
Market Cap 3.77 Bn
ROIC (Qtr) 17.24
Div Yield % 2.01
Rev 1y % (Qtr) 7.96
Total Debt (Qtr) 82.60 Mn
Debt/Equity (Qtr) 0.21

About

Exponent, Inc., a science and engineering consulting firm, operates under the stock symbol EXPO in the industry of providing solutions to complex problems. With over 50 years of experience, Exponent has established itself as a leading provider of engineering and scientific consulting services to clients worldwide. The company's main business activities revolve around providing specialized services through its two primary segments: Engineering and Other Scientific, and Environmental and Health. These services span across various countries and regions,...

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Analysis

Pros

  • Strong operating cash flow of 132.20M provides robust 1.60x coverage of total debt 82.60M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 207.38M provide 31.95x coverage of short-term debt 6.49M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 752.84M provides 9.11x coverage of total debt 82.60M, indicating robust asset backing and low credit risk.
  • Strong operating cash flow of 132.20M provides 5.39x coverage of SG&A expenses 24.55M, showing efficient operational cost management.
  • Robust free cash flow of 122.90M exceeds capital expenditure of 9.30M by 13.22x, indicating strong organic growth funding capability.

Cons

  • Operating cash flow of 132.20M barely covers its investment activities of (9.30M), with a coverage ratio of -14.22, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 132.20M provides thin coverage of dividend payments of (60.88M) with a -2.17 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Retained earnings of 658.79M provide limited buffer against comprehensive income items of (2.40M), which is -274.27x, indicating elevated exposure to market risks.
  • Operating cash flow of 132.20M is outpaced by equity issuance of (69.21M) (-1.91 ratio), indicating concerning reliance on equity markets for funding operations.
  • R&D investment of 0 represents just 0x of SG&A expenses of 24.55M, indicating potential underinvestment in innovation relative to administrative overhead.

Peer Comparison

Companies in the Engineering & Construction
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 PWR Quanta Services, Inc. 65.02 Bn 63.86 2.39 6.02 Bn
2 FER Ferrovial SE 48.37 Bn 14.34 5.08 -
3 FIX Comfort Systems Usa Inc 34.25 Bn 40.89 4.12 0.39 Bn
4 EME EMCOR Group, Inc. 28.27 Bn 25.01 1.74 0.42 Bn
5 MTZ Mastec Inc 17.18 Bn 51.88 1.25 2.77 Bn
6 APG APi Group Corp 16.45 Bn 105.48 2.15 3.05 Bn
7 J Jacobs Solutions Inc. 16.43 Bn 56.79 1.37 2.71 Bn
8 ACM Aecom 13.10 Bn 23.31 0.81 3.23 Bn

Industry Comparisons

Current Valuation

Metric Value Industry Percentile
EV to Assets 4.75 1.60
EV to Cash from Ops. 27.34 6.21
EV to Debt 43.75 12.02
EV to EBIT 25.01 16.63
EV to EBITDA 28.25 13.11
EV to Free Cash Flow [EV/FCF] 29.41 64.21
EV to Market Cap 0.96 1.27
EV to Revenue 6.33 1.63
Price to Book Value [P/B] 9.35 5.92
Price to Earnings [P/E] 35.92 28.08

Dividend Metrics

Metric Value Industry Percentile
Dividend Coverage Ratio 1.72 2.56
Dividend Payout Ratio % 57.60 17.64
Dividend per Basic Share 1.18 0.24
FCF Dividend Payout Ratio % 48.84 8.25
Interest Coverage 0.00 80.17

Growth Metrics

Metric Value Industry Percentile
Capex Growth (1y) % -48.18 -167.27
Cash and Equivalents Growth (1y) % -5.61 637.93
Dividend Growth (1y) % 7.27 2.92
EBIAT Growth (1y) % -1.42 92.73
EBITDA Growth (1y) % 6.37 8.03
EBIT Growth (1y) % -1.10 85.41
EBT Growth (1y) % -1.10 42.19
EPS Growth (1y) % -1.44 43.98
FCF Growth (1y) % -19.94 -20.57
Gross Profit Growth (1y) % 6.60 32.55

Liquidity Ratios

Metric Value Industry Percentile
Asset Utilization Ratio 0.75 1.14
Cash Payout Ratio 0.43 0.05
Cash Ratio 1.34 0.38
Current Ratio 2.69 1.54
Debt to Equity Ratio 0.21 0.89
Interest Cover Ratio 0.00 80.17
Times Interest Earned 0.00 80.17

Profitability

Metric Value Industry Percentile
EBITDA Margin % 27.10 0.40
EBIT Margin % 25.29 -2.30
EBT Margin % 25.29 -4.58
Gross Margin % 24.90 20.40
Net Profit Margin % 18.30 -5.95