TTEK · Tetra Tech

The thesis

Tetra Tech is more likely than not to beat the S&P 500 over the next three months. A backlog of $4.67 billion, up 13% in a year, and fiscal 2027 guidance that tops the consensus at its midpoint support near-term earnings. The first-quarter fiscal 2027 report, expected in late January 2027, shows whether net revenue (revenue after subcontractor costs) lands inside the company's $1.040–$1.080 billion forecast.

The company reported fiscal 2026 results after the close on 11 November 2026. Fourth-quarter adjusted earnings per share (EPS) were $0.49, against a $0.47 estimate. GAAP diluted EPS was a record $0.51, and the dividend rose 11% to $0.072 a quarter. The shares opened at $41.38 on 12 November 2026, according to MarketBeat. In the session before the report they had closed at $37.61, down $3.04.

The rating is Medium, not HIGH, for two reasons. The fiscal 2027 net revenue guide of $4.425–$4.625 billion implies low-to-mid single-digit growth. Baird kept a Neutral rating on 12 November 2026 with a $40 target. What is priced in: the $37.61 close of 11 November 2026 sat just under the $39.60 average analyst target that MarketBeat reported on 12 November 2026, at a price-to-earnings ratio of 23.40. Further gains need earnings to rise faster than the guide's midpoint.

Bullish and bearish views on Tetra Tech, Inc.

The bull case on Tetra Tech, Inc. (TTEK), in brief: backlog grew faster than revenue. The bear case: reported growth is still thin.

Bull case

• Backlog grew faster than revenue. Backlog reached $4.67 billion at the fiscal year-end on 27 September 2026, up 13% and more than $530 million in a year (company 8-K, 11 November 2026). Company news on 12 November 2026 said new orders topped $1.6 billion.
• Guidance is above consensus at the midpoint. On 11 November 2026 the company guided fiscal 2027 GAAP EPS to $1.65–$1.80 against a $1.71 estimate. It guided net revenue to $4.425–$4.625 billion against a $4.497 billion estimate (Benzinga, 11 November 2026).
• The core business is growing under the headline decline. Fiscal 2026 net revenue was $4.35 billion, down about 6% as reported. Excluding the lost USAID and State Department (USAID/DOS) work and episodic disaster response, it rose 7% (company 8-K, 11 November 2026).
• Margins and cash flow improved. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was $660.0 million in fiscal 2026, with the margin up 90 basis points. Operating cash flow rose 14% to $523.0 million (company 8-K, 11 November 2026).
• Buybacks shrink the share count. The company repurchased $302.0 million of stock in fiscal 2026, $100 million of it in the fourth quarter. $798 million of authorization remained on 27 September 2026 (company 8-K, 11 November 2026).

Bear case

• Reported growth is still thin. Fourth-quarter net revenue was $1.153 billion, down about 1% from a year earlier and inside the company's own $1.12–$1.17 billion forecast (company 8-K, 11 November 2026). The quarter met its net revenue forecast without beating it.
• The government services segment is shrinking. Government Services Group net revenue fell to $1.88 billion in fiscal 2026 from $2.32 billion. Only the Commercial/International Services Group grew, to $2.47 billion from $2.29 billion (company 8-K, 11 November 2026).
• Federal funding remains a stated risk. The 11 November 2026 release lists dependence on U.S. government agencies and funding disruption as risks. The loss of USAID work drove the reported revenue decline in fiscal 2026.
• Debt rose to fund acquisitions. Long-term debt rose to $892.0 million from $763.4 million in fiscal 2026, after $191.9 million of acquisitions. Year-end cash was $235.1 million (company 8-K, 11 November 2026).
• Analyst targets were cut before the report. On 15 October 2026 RBC cut its target to $44 from $46 and KeyBanc cut to $41 from $43, per MarketBeat. Baird's $40 target sits only slightly above the last close.

Price setup

The shares closed at $37.61 on 11 November 2026, 12.8% below the 52-week intraday high of $43.14 set on 11 February 2026. The 52-week closing low was $26.18 on 15 May 2026. Since then the shares have recovered most of their earlier decline.

On adjusted daily closes, the 11 November 2026 close was above the 50-day moving average of $35.94 and the 200-day average of $33.12. The three-month change is 3.2%, from a $36.43 close on 13 August 2026. From 4 November to 10 November 2026 the shares closed between $40.29 and $41.09. The 12 November 2026 open of $41.38 was back in that range, according to MarketBeat.

The case turns on whether the shares hold above the 50-day average as the post-report move settles. A return toward the February high would require earnings to come in at the upper half of the fiscal 2027 guide.

Catalysts ahead

• ~28 January 2027 (est.): Q1 fiscal 2027 results. The first test of the fiscal 2027 guide: net revenue inside $1.040–$1.080 billion and EPS of $0.36–$0.38 would confirm that backlog growth is turning into revenue; a figure below the range would break the case.

What would change the view

A daily close below $35.94, the 50-day average on 11 November 2026, which would erase the post-report gain and show the shares back under their recent trend; or first-quarter fiscal 2027 net revenue below the $1.040 billion low end of the company's forecast.

The risks this note tracks, each with what would confirm it:

• Further U.S. federal funding cuts or disruption shrink the Government Services Group beyond the USAID loss already absorbed. Confirmed by: Government Services Group net revenue declining again year over year in the Q1 fiscal 2027 report, or a new federal contract cancellation disclosed in an 8-K.
• Backlog converts to revenue more slowly than the fiscal 2027 guide assumes. Confirmed by: Q1 fiscal 2027 net revenue near or below the $1.040 billion low end while backlog keeps rising.
• Margin expansion stalls, leaving EPS near the $1.65 low end of the fiscal 2027 guide. Confirmed by: the adjusted EBITDA margin flat or down year over year in the Q1 fiscal 2027 report.
• Acquisition-funded growth raises leverage and dilutes returns. Confirmed by: long-term debt rising above the $892.0 million fiscal 2026 year-end level without a matching rise in organic net revenue growth.

What it trades with

MarketBeat gave the shares a beta of 0.86 on 12 November 2026, so they move somewhat less than the broad market. The main company-specific swing factor is U.S. federal spending. Government Services Group net revenue fell to $1.88 billion from $2.32 billion in fiscal 2026 after the USAID cuts. The growth engine is commercial and international water, environment and infrastructure work. The company's recent federal wins also include NASA, the U.S. Navy, the EPA, the U.S. Army Corps of Engineers and NOAA (company 8-K, 11 November 2026). Institutions held about 93.89% of the shares, per MarketBeat on 12 November 2026. Moves therefore tend to follow fund flows around results.