Willdan's (WLDN) Stock Rises as Q4 Earnings Beat Estimates
Willdan Group, Inc. WLDN reported mixed fourth-quarter fiscal 2023 (ended Dec 29, 2023) results, with earnings surpassing the Zacks Consensus Estimate but contract revenues missing the same. On the other hand, the top and the bottom lines increased year over year.
The quarter’s results reflect robust contributions from the Energy, and Engineering and Consulting segments. The uptrend was attributable to end-of-year program expansions of the company. Also, a decline in stock-based compensation, as well as depreciation and amortization expenses aided the uptick in the the company's bottom line.
Owing to the solid results and the improving trends, the company unveiled its fiscal 2024 guidance portraying year-over-year growth trends in net revenues, adjusted EBITDA and adjusted earnings per share.
Following the announcement, shares of Willdan notably grew 15.9% in the after-hours trading session on Mar 7.
Inside the Headlines
Willdan reported adjusted earnings per share (EPS) of 80 cents, which surpassed the consensus estimate of 35 cents by a whopping 128.6%. In the year-ago quarter, it reported EPS of 36 cents.
Quarterly contract revenues of $155.7 million missed the consensus mark of $160 million by 2.7%. However, the reported figure increased 37.5% from the year-ago level of $113.3 million.
Willdan Group, Inc. Price, Consensus and EPS Surprise
Willdan Group, Inc. price-consensus-eps-surprise-chart | Willdan Group, Inc. Quote
Gross profit margin of 35% was down 310 basis points (bps) from 38.1% in the year-ago quarter. Adjusted EBITDA for the reported period increased 48.2% from the prior-year period to $17.5 million. The adjusted EBITDA margin expanded 80 bps to 11.2% year over year.
Segmental Discussion
Energy Segment: This segment’s contract revenues increased year over year to $134.6 million in the fourth quarter from $95.3 million reported in the prior-year quarter. Subcontractor services and other direct costs during the quarter were $74.9 million, up from $48.7 million reported in the year-ago quarter.
Engineering and Consulting Segment: The quarter’s contract revenues from this segment increased year over year to $21 million from $18 million. Subcontractor services and other direct costs during the quarter were $0.9 million, up from $0.8 million reported in the year-ago quarter.
Financial Details
As of Dec 29, 2023, cash and cash equivalents totaled $23.4 million, up from $8.8 million at the end of 2022. Finance lease obligations, less the current portion, were $1.2 million as of 2023 end, down from $1.6 million at the end of 2022. In fiscal 2023, net cash provided by operating activities was $39.2 million, up from $9.4 million reported in 2022.
Fiscal 2023 Highlights
For the fiscal year, Willdan reported contract revenues of $510.1 million, up 18.9% from 2022 levels. Adjusted EPS of $1.75 surged 98.9% from 88 cents a year ago.
Gross profit in fiscal 2023 was $179.8 million, up from $143.6 million reported in the prior year. Adjusted EBITDA of $45.7 million was up 96.3% from the 2022 level of $23.3 million.
Fiscal 2024 Outlook
For the fiscal year, Willdan expects net revenues between $270 million and $280 million. Adjusted EBITDA is anticipated between $48 million and $50 million.
The company expects adjusted EPS to range within $1.80-$1.87 for fiscal 2024.
Zacks Rank & Recent Construction Releases
Willdan currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
MasTec, Inc. MTZ reported impressive results in fourth-quarter 2023, with earnings and revenues beating the Zacks Consensus Estimate. Earnings declined on a year-over-year basis, but revenues increased on the back of strong contributions from the Oil and Gas segment.
MTZ's fourth-quarter results aligned with expectations following a challenging 2023. The company is poised to capitalize on the opportunities and aims to achieve record levels of revenues and adjusted EBITDA in 2024. The robust demand for MTZ's services suggests the potential for double-digit revenues and earnings growth in 2025 and beyond.
Dycom Industries Inc. DY reported tepid results for fourth-quarter fiscal 2024 (ended Jan 27, 2024). Both the top and bottom lines missed the Zacks Consensus Estimate.
Contract revenues of $952.5 million moved up 3.8% year over year but lagged the consensus mark of $971 million by 2%. Contract revenues decreased 2.5% on an organic basis. Acquisitions contributed $57.5 million to contract revenues. The company’s top five customers contributed 58.6% to total contract revenues, which declined 13% organically. For the fiscal first quarter, DY expects contract revenues to be in line or decline slightly from the first quarter of fiscal 2024 level.
TopBuild Corp. BLD reported impressive results for fourth-quarter 2023. Its earnings and revenues surpassed the Zacks Consensus Estimate and improved year over year.
The 2023 performance of the company demonstrates a consistent enhancement and profitable expansion, notably in the commercial and industrial sectors. These sectors experienced 4.9% growth in the fourth quarter and 6.2% growth throughout 2023. President and CEO Robert Buck conveyed contentment regarding the company's adeptness in enhancing operational efficiencies and elevating sales and labor productivity. These efforts significantly bolstered revenue growth and margin expansion.
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