Maximus, Inc. (NYSE: MMS)

Sector: Industrials Industry: Specialty Business Services CIK: 0001032220
Market Cap 4.66 Bn
P/B 3.59
P/E 19.14
P/S 1.53
ROIC (Qtr) 13.44
Div Yield % 1.88
Rev 1y % (Qtr) -4.11
Total Debt (Qtr) 1.67 Bn
Debt/Equity (Qtr) 0.97
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About

MAXIMUS, INC., a company with the ticker symbol MMS, has been operating for over 45 years with a mission to "Move People Forward" by helping millions of people access vital government services. The company is a key player in the government services industry and operates through three segments: U.S. Federal Services, U.S. Services, and Outside the U.S. MAXIMUS's main business activities involve delivering end-to-end solutions to governments, focusing on program operations, clinical services, and technology solutions. The company operates in various...

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Investment thesis

Bull case

  • Robust free cash flow of 218.48M exceeds capital expenditure of 46.48M by 4.70x, indicating strong organic growth funding capability.
  • Tangible assets of 1.70B provide exceptional 19.63x coverage of deferred revenue 86.52M, showing strong service capability backing.
  • Operating cash flow of 264.97M provides strong 3.06x coverage of deferred revenue 86.52M, indicating service delivery capability.
  • Operating cash flow of 264.97M fully covers other non-current liabilities 219.44M by 1.21x, showing strong long-term stability.
  • Cash reserves of 137.59M provide ample 7.96x coverage of acquisition spending 17.28M, enabling strategic growth opportunities.

Bear case

  • Operating cash flow of 264.97M barely covers its investment activities of (31.37M), with a coverage ratio of -8.45, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 264.97M provides thin coverage of dividend payments of (66.99M) with a -3.96 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • High depreciation of 135.41M relative to operating cash flow of 264.97M, which is 0.51x suggests significant maintenance capital requirements affecting free cash flow.
  • Tax assets of 17.06M provide limited offset against tax liabilities of 194.27M, which is 0.09x, indicating potential future cash flow pressure from tax obligations.
  • Operating cash flow of 264.97M is outpaced by equity issuance of (259.45M) (-1.02 ratio), indicating concerning reliance on equity markets for funding operations.

Segments Breakdown of Revenue (2025)

Product and Service Breakdown of Revenue (2025)

Peer comparison

Companies in the Specialty Business Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 CTAS Cintas Corp 120.08 Bn 556.91 33.85 3.24 Bn
2 RELX Relx Plc 56.19 Bn 20.01 4.34 9.82 Bn
3 TRI Thomson Reuters Corp /Can/ 37.42 Bn 24.91 5.00 2.44 Bn
4 CPRT Copart Inc 36.25 Bn 22.74 7.79 0.10 Bn
5 RBA Rb Global Inc. 19.20 Bn 49.09 4.24 4.21 Bn
6 ULS UL Solutions Inc. 14.12 Bn 43.32 4.92 0.74 Bn
7 GPN Global Payments Inc 11.52 Bn 284.78 8.66 16.20 Bn
8 ARMK Aramark 10.37 Bn 32.72 0.55 6.57 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.09 2.48
EV to Cash from Ops. EV/CFO 11.87 30.22
EV to Debt EV to Debt 2.73 31.08
EV to EBIT EV/EBIT 14.09 94.66
EV to EBITDA EV/EBITDA 11.00 18.37
EV to Free Cash Flow [EV/FCF] EV/FCF 14.40 -20.73
EV to Market Cap EV to Market Cap 0.98 178.66
EV to Revenue EV/Rev 1.50 8.12
Price to Book Value [P/B] P/B 3.59 5.37
Price to Earnings [P/E] P/E 19.14 65.19
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 5.55 -15,800.59
Dividend Payout Ratio % Div Payout % (Qtr) 18.10 10.14
Dividend per Basic Share Div per Share (Qtr) 1.20 0.35
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 30.12 7.65
Interest Coverage Int. cover (Qtr) 6.75 30.46
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 59.56 -178.22
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 89.39 155.14
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 5.38
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 27.96 -34.92
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 21.94 -86.28
EBIT Growth (1y) % EBIT 1y % (Qtr) 25.86 -22.62
EBT Growth (1y) % EBT 1y % (Qtr) 28.78 -287.35
EPS Growth (1y) % EPS 1y % (Qtr) 41.76 -118.47
FCF Growth (1y) % FCF 1y % (Qtr) -26.86 -146.43
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 7.77 2.63
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.28 0.84
Cash Payout Ratio Cash Payout (Qtr) 0.22 -0.03
Cash Ratio Cash Ratio (Qtr) 0.23 1.15
Current Ratio Curr Ratio (Qtr) 2.34 4.12
Debt to Equity Ratio Debt/Equity (Qtr) 0.97 0.92
Interest Cover Ratio Int Coverage (Qtr) 6.75 30.46
Times Interest Earned Times Interest Earned (Qtr) 6.75 30.46
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 13.50 -33.89
EBIT Margin % EBIT Margin % (Qtr) 10.97 -43.32
EBT Margin % EBT Margin % (Qtr) 9.34 -44.88
Gross Margin % Gross Margin % (Qtr) 25.10 39.81
Net Profit Margin % Net Margin % (Qtr) 6.90 -41.60