Maximus, Inc. MMS reported impressive third-quarter fiscal 2024 results, with earnings and revenues surpassing the Zacks Consensus Estimate.
Quarterly adjusted earnings of $1.7 per share beat the Zacks Consensus Estimate by 18.4% and increased more than 100% on a year-over-year basis. Revenues of $1.3 billion beat the consensus mark by 3% and rose 10.6% from the year-ago quarter.
Segmental Revenues
The U.S. Federal Services segment’s revenues of $683.3 million rose 17% from the year-ago reported number and beat our estimate of $644.8 million. The Outside the U.S. segment’s revenues of $159.3 million increased 2.3% from third-quarter fiscal 2023 and outpaced our anticipated $139.5 million. The U.S. Services segment’s revenues of $449.1 million increased 5.2% year over year and missed our estimate of $478.1 million.
Sales & Pipeline
Signed contract awards as of Jun 30 totaled $1.3 billion and contracts pending (awarded but unsigned) amounted to $398 million. The sales pipeline, as of Jun 30, was $44.1 billion. This included $2.9 billion in pending proposals, $7.3 billion in proposals in preparation and $33.8 billion in opportunities tracking. The book-to-bill ratio as of Jun 30, 2024, was 0.6X.
Operating Performance
Adjusted operating income of $165.3 million increased more than 100% from the year-ago quarter. This compares with our estimate of $124.9 million.
The adjusted operating income margin of 12.6% increased 570 basis points year over year, surpassing our estimate of 9.9%.
Balance Sheet & Cash Flow
Maximus ended the quarter with a cash and cash equivalents balance of $102.8 million compared with $77.4 million reported at the end of the second quarter of fiscal 2024.
The company utilized $199.3 million in cash from operations. Capital expenditure was $34.7 million and the adjusted free cash flow amounted to $164.6 million.
2024 Guidance
For fiscal 2024, the company raised its guidance for revenues to $5.25-$5.35 billion from the $5.15-$5.25 billion provided previously.
Maximus raised adjusted earnings to $6.00-$6.20 from the $5.65-$5.85 provided at the end of the preceding quarter.
The guidance for the free cash flow was raised to $350-$380 million from the $330-$370 million provided in the previous quarter. Maximus hiked its expectation for interest expenses to $80 million from the preceding quarter’s $77 million.
Earnings Snapshots of Other Service Providers
S&P Global Inc. SPGI reported impressive second-quarter results.
SPGI’s adjusted EPS (excluding 82 cents from non-recurring items) of $4.04 surpassed the Zacks Consensus Estimate by 10.1% and increased 29.5% year over year. Revenues of $3.5 billion beat the consensus estimate by 3.4% and improved 14.5% year over year.
Insperity, Inc. NSP posted mixed second-quarter 2024 results.
NSP’s adjusted earnings (excluding 38 cents from non-recurring items) of 86 cents per share outpaced the consensus estimate by 17.8% and increased 34.4% year over year. Revenues of $1.6 billion missed the Zacks Consensus Estimate by a slight margin but increased 1.3% from the year-ago quarter.
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Insperity, Inc. (NSP) : Free Stock Analysis Report
Maximus, Inc. (MMS) : Free Stock Analysis Report
S&P Global Inc. (SPGI) : Free Stock Analysis Report
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