Maximus, Inc. MMS reported unimpressive fourth-quarter fiscal 2025 results, wherein both earnings and revenues missed the Zacks Consensus Estimate.
Despite the lower-than-expected results, the stock rallied 5.6% following the earnings release on Nov. 20.
Maximus, Inc. Price, Consensus and EPS Surprise
Maximus, Inc. price-consensus-eps-surprise-chart | Maximus, Inc. Quote
Quarterly adjusted earnings of $1.62 per share missed the Zacks Consensus Estimate by 0.6% but increased 11% year over year. Revenues of $1.32 billion missed the consensus mark by 1.5% but rose 0.19% from the year-ago quarter.
Segmental Revenues of Maximus
The U.S. Federal Services segment’s revenues of $747.9 million rose 10.8% from the year-ago reported number and beat our estimate of $737.9 million. Meanwhile, the Outside the U.S. segment’s revenues of $141.2 million decreased 20.3% year over year and beat our anticipation of $110.7 million. The U.S. Services segment’s revenues of $429.3 million fell 7.4% year over year and lagged our estimate of $474.2 million.
MMS’ Sales and Pipeline
Year-to-date signed contract awards, as of Sept. 30, 2025, totaled $4.7 billion. Contracts pending (awarded but unsigned) amounted to $331 million. The sales pipeline, as of Sept. 30, was $51.3 billion. This included $3.37 billion in pending proposals, $1.37 billion in proposals in preparation and $46.6 billion in opportunities tracking. The book-to-bill ratio was 0.9 on a trailing 12-month basis.
MMS’ Operating Performance
Operating income of $122.86 million increased 9.9% year over year. This compares with our expected adjusted operating income of $148.4 million, down 10.1% year over year. The adjusted operating income margin of 9.32% increased 82 basis points year over year.
Maximus’ Balance Sheet and Cash Flow
Maximus ended the quarter with a cash and cash equivalent balance of $222 million compared with $59.8 million reported at the end of the prior quarter.
The company generated $429 million in cash from operations. Free cash flow was $366 million.
MMS Updates Fiscal 2026 Guidance
For fiscal 2026, MMS expects the total revenues to be between $5.225 billion and $5.425 billion. The Zacks Consensus Estimate is pegged at $5.61 billion.
Adjusted earnings are anticipated in the range of $7.95-$8.25 per share. The updated guided range is higher than the current Zacks Consensus Estimate of $7.34.
The company expects an adjusted EBITDA margin of approximately 13.6-13.7%.
Free cash flow expectation is between $450 million and $500 million. The company forecasts interest expenses of approximately $69 million. The effective income tax rate is anticipated to be within 25%. On a full-year basis, the weighted average shares outstanding are forecasted to be approximately 55.5 million.
Currently, Maximus carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot
Omnicom Group Inc. OMC reported impressive third-quarter 2025 results, wherein earnings and revenues beat the Zacks Consensus Estimate.
Earnings of $2.15 per share beat the consensus estimate by 4.2% and increased 10.3% year over year. Total revenues of $4.04 billion surpassed the consensus estimate by 0.4% and rose 4% year over year. The increase in the top line was led by a 2.6% jump in revenues from organic growth.
ManpowerGroup, Inc. MAN posted impressive third-quarter 2025 results, wherein earnings and revenues beat the Zacks Consensus Estimate.
Quarterly adjusted earnings per share came in at 83 cents, which beat the Zacks Consensus Estimate by 1.2% but decreased 35.7% year over year. Total revenues of $4.63 billion surpassed the consensus estimate by 0.6% and rose 2.3% year over year.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
