Group 1: CRA International, Inc. (CRAI) Q1 2025 Results - CRAI reported adjusted EPS of $2.22, exceeding the Zacks Consensus Estimate by 15% and increasing 13.3% year over year [1] - Revenues reached $182 million, beating the consensus mark by 3.5% and rising 6% from the previous year [1] Group 2: Operational Metrics - The company achieved a utilization rate of 76%, with a 5% decrease in headcount year over year [2] - Non-GAAP EBITDA increased by 10.6% year over year to $24.8 million, with a non-GAAP EBITDA margin improvement of 58 basis points to 13.6% [2] Group 3: Cash Flow and Dividends - CRAI ended the quarter with cash and cash equivalents of $25.6 million, down from $26.7 million in the prior quarter [3] - The company generated $80 million from operating activities and reported capital expenditures of $974 million [3] - CRAI paid out $3.5 million in dividends during the quarter [3] Group 4: 2025 Outlook - CRAI provided 2025 revenue guidance in the range of $715 million to $735 million, with a non-GAAP EBITDA margin expected between 12% and 13% [4] - The company currently holds a Zacks Rank 3 (Hold) [4]

Financial Data and Key Metrics Changes - Revenue increased by 5.9% year over year to $181.9 million, marking the highest quarterly revenue in the company's history [5] - Non-GAAP net income, earnings per diluted share, and EBITDA increased year over year by 11%, 13%, and 11% respectively, each setting a new quarterly record [6] - Consultant headcount decreased by 5% compared to the first quarter of fiscal 2024, remaining flat sequentially [7][18] - Consulting utilization improved year over year to 76% [7] Business Line Data and Key Metrics Changes - Four practices (energy, finance, intellectual property, and life sciences) posted double-digit revenue growth, while the antitrust and competition economics practice achieved a new high for quarterly revenue [6] - Revenue from legal and regulatory services increased by roughly 5%, aligning with broader legal market trends [9] - Management consulting services revenue increased by 10% year over year, driven by strong performance in energy and life sciences practices [13] Market Data and Key Metrics Changes - Worldwide M&A activity reached $885 billion during the first quarter of fiscal 2025, representing a 15% increase compared to the previous year [9] - Total case filings and court judgments increased by 132% compared to the first quarter of fiscal 2024 [9] Company Strategy and Development Direction - The company aims to optimize its service portfolio by reconfiguring teams in targeted areas, affecting approximately 15 individuals [16] - The company is focused on maintaining a strong pipeline of projects and is optimistic about the life sciences practice's growth potential [25][26] Management's Comments on Operating Environment and Future Outlook - Management noted that the journey to a record-setting Q1 was not linear, with a slow start in January followed by increased activity in February and March [23] - The company reaffirmed its full-year financial guidance for fiscal 2025, expecting revenue in the range of $715 million to $725 million and a non-GAAP EBITDA margin of 12% to 13% [17] Other Important Information - The company concluded the quarter with $25.6 million in cash and $85 million in borrowings under its revolving credit facility, resulting in net debt of $59.4 million [20] - The company will celebrate its sixtieth anniversary by ringing the opening bell for NASDAQ on June 2 [67] Q&A Session Summary Question: April activity and guidance confidence - Management observed that trends from March have continued into April, but it is too early to declare sustained success [24] Question: Life sciences pipeline opportunities - The life sciences practice is experiencing success geographically and across business concentration areas, with hopes for continued momentum [26] Question: Headcount growth and retention - The company is focused on optimizing investments and expects headcount growth to align with revenue growth in the medium to long term [30][32] Question: External factors affecting business activity - Management noted that various macro and geopolitical factors create uncertainty, impacting client decisions [41] Question: Industry verticals showing activity - All parts of the portfolio are growing, contributing to strong financial results [44] Question: Return to office trends - There has been no significant shift in office participation, with colleagues averaging just over three days a week in the office [47] Question: Restructuring details - The restructuring affected 15 individuals, aimed at optimizing the portfolio without indicating general health issues in the practices [56] Question: Antitrust demand trends - The antitrust and competition economics practice continues to see strong demand, driven by both merger-related activity and investigations [59] Question: Collaboration across practices - Collaboration across practices and geographies is common and is expected to grow as client needs become more complex [62]

分组1 - CRA International (CRAI) reported quarterly earnings of $2.22 per share, exceeding the Zacks Consensus Estimate of $1.93 per share, and up from $1.96 per share a year ago, representing an earnings surprise of 15.03% [1] - The company posted revenues of $181.85 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 3.46%, compared to year-ago revenues of $171.79 million [2] - CRA has consistently surpassed consensus EPS estimates over the last four quarters, indicating strong performance [2] 分组2 - The stock has underperformed the market, losing about 13.4% since the beginning of the year, compared to the S&P 500's decline of 5.3% [3] - The current consensus EPS estimate for the coming quarter is $1.85 on revenues of $179.52 million, and for the current fiscal year, it is $7.75 on revenues of $717.66 million [7] - The Consulting Services industry is currently ranked in the top 11% of over 250 Zacks industries, suggesting a favorable outlook for stocks in this sector [8]

Financial Data and Key Metrics Changes - Revenue increased by 5.9% year over year to $181.9 million, marking the highest quarterly revenue in the company's history [5] - Non-GAAP net income, earnings per diluted share, and EBITDA increased year over year by 11%, 13%, and 11% respectively, each setting a new quarterly record [6] - Consultant headcount decreased by 5% compared to the first quarter of fiscal 2024, while consulting utilization improved to 76% [7][18] Business Line Data and Key Metrics Changes - Four practices: energy, finance, intellectual property, and life sciences posted double-digit revenue growth, while the antitrust and competition economics practice achieved a new high for quarterly revenue [6] - Revenue from legal and regulatory services increased by approximately 5%, aligning with broader legal market trends [8] - Management consulting services revenue increased by 10% year over year, driven by strong performance in energy and life sciences practices [12] Market Data and Key Metrics Changes - Worldwide M&A activity reached $885 billion during the first quarter, representing a 15% increase compared to the previous year [8] - Total case filings and court judgments increased by 132% compared to the first quarter of fiscal 2024, indicating a robust legal market [8] Company Strategy and Development Direction - The company aims to optimize its service portfolio by reconfiguring teams in targeted areas, affecting approximately 15 individuals [14] - The focus remains on expanding geographic reach and enhancing service offerings, particularly in high-demand areas such as antitrust and life sciences [9][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong start to fiscal 2025, reaffirming full-year financial guidance of $715 million to $725 million in revenue [16] - The company remains cautious about uncertain global macroeconomic conditions that could impact business [17] Other Important Information - The company ended the quarter with $25.6 million in cash and $85 million in borrowings, resulting in net debt of $59.4 million [19] - The effective tax rate for the first quarter was 27.2% on a non-GAAP basis, slightly down from 28% in the previous year [18] Q&A Session Summary Question: April activity and guidance confidence - Management noted that activity levels improved throughout the quarter, with trends from March continuing into April, though it is too early to declare sustained momentum [22][24] Question: Life sciences pipeline and opportunities - The life sciences practice is experiencing success across geographic and business areas, with hopes for continued momentum into Q2 and throughout 2025 [25][26] Question: Headcount growth and retention - The company is focused on optimizing investments and expects headcount growth to align with revenue growth in the medium to long term, despite a recent 5% year-over-year decline [28][30] Question: External factors affecting business activity - Management indicated that various macroeconomic and geopolitical factors create uncertainty, impacting client decisions but noted a general growth across all practices [38][41] Question: Return to office trends - The company has not seen significant shifts in office participation, with employees averaging just over three days in the office per week, consistent with pre-COVID practices [45][46] Question: Restructuring details - Management refrained from providing specifics on the restructuring affecting 15 individuals, emphasizing that it does not reflect the overall health of the practices involved [52][53] Question: Antitrust demand trends - The antitrust and competition economics practice continues to see strong demand, driven by both merger-related activity and ongoing investigations [57] Question: Collaboration across practices - Collaboration across practices and geographies is common and is seen as an underreported strength of the company, enhancing service delivery to clients [60][61]

Financial Performance - For Q1 of fiscal 2025, revenue was $181.9 million, a 5.9% increase from $171.8 million in Q1 of fiscal 2024[3] - Net income for Q1 of fiscal 2025 was $18.0 million, or 9.9% of revenue, compared to $13.7 million, or 8.0% of revenue, in Q1 of fiscal 2024[19] - Non-GAAP net income increased to $15,253 thousand, or 8.4% of revenue, up from $13,798 thousand, which was 8.0% of revenue in the previous year[42] - Non-GAAP EBITDA for Q1 of fiscal 2025 was $24.8 million, or 13.6% of revenue, compared to $22.4 million, or 13.0% of revenue, in Q1 of fiscal 2024[20] - Revenues for the fiscal quarter ended March 29, 2025, were $181,851 thousand, a 5.9% increase from $171,789 thousand for the same period in 2024[42] - Net income for the quarter was $18,002 thousand, representing 9.9% of revenue, compared to $13,691 thousand or 8.0% of revenue in the prior year[42] Operational Metrics - Companywide utilization rate improved to 76% in Q1 of fiscal 2025, up from 73% in Q1 of fiscal 2024[5] - Total Days Sales Outstanding (DSO) for Q1 of fiscal 2025 was 107 days, slightly up from 106 days in Q1 of fiscal 2024[24] - The weighted average number of diluted shares outstanding decreased from 7,011 in Q1 2024 to 6,862 in Q1 2025, indicating a reduction in share dilution[40] Expenses and Liabilities - SG&A expenses for Q1 of fiscal 2025 were $32.5 million, or 17.9% of revenue, compared to $30.5 million, or 17.8% of revenue, in Q1 of fiscal 2024[7] - Selling, general and administrative expenses for Q1 2025 were $32,538, which is 17.9% of revenue, slightly up from 17.8% in Q1 2024[38] - Total liabilities stood at $363,123 thousand, slightly up from $359,366 thousand in the previous quarter[45] Cash Flow and Capital Expenditures - Cash and cash equivalents decreased to $25.6 million at March 29, 2025, from $37.1 million at March 30, 2024[25] - Cash and cash equivalents at the end of Q1 2025 were $25,598, down from $37,122 at the beginning of the period, reflecting a net decrease of $11,524[30] - Capital expenditures totaled $1.0 million for Q1 of fiscal 2025, an increase from $0.7 million in Q1 of fiscal 2024[27] - Net cash provided by operating activities for Q1 2025 was $32,821, compared to $(79,994) in Q4 2024, indicating a significant recovery[30] - Adjusted net cash flows from operations for Q1 2025 reached $97,135, while for Q1 2024 it was $77,593, reflecting a year-over-year increase of 24.0%[32] Tax and Borrowings - The effective tax rate for Q1 of fiscal 2025 was 27.0%, compared to 28.0% in Q1 of fiscal 2024[17] - Outstanding borrowings under CRA's revolving credit facility increased to $85.0 million as of March 29, 2025, from $70.0 million at March 30, 2024[26] - The company borrowed $90,000 thousand under its revolving line of credit, compared to $70,000 thousand in the prior year[47] Foreign Currency and Other Losses - The company experienced a foreign currency loss of $474 in Q1 2025, compared to a loss of $142 in Q1 2024, indicating increased volatility in foreign exchange rates[40]

Core Viewpoint - Charles River Associates (CRAI) has demonstrated strong performance over the past year and is expected to maintain this momentum, making it a compelling addition to investment portfolios [1] Group 1: Performance and Rankings - CRAI's stock has increased by 17% over the past year, contrasting with a 13% decline in the industry [2] - The company holds a Zacks Rank of 2 (Buy) and a VGM Score of A, indicating strong investment potential [3] Group 2: Earnings Estimates and Surprises - In the last 60 days, three earnings estimates for 2025 have been revised upward, with no downward revisions, reflecting analysts' confidence [4] - The Zacks Consensus Estimate for 2025 earnings has risen by 3.1% [4] - CRAI has consistently exceeded earnings expectations, achieving an average surprise of 25.9% over the last four quarters [4] Group 3: Revenue and Growth Projections - The Zacks Consensus Estimate for CRAI's 2025 revenues is $717.7 million, representing a year-over-year growth of 4.4% [5] - The consensus estimate for earnings per share is $7.75, indicating a 2% year-over-year growth [5] Group 4: Talent and Workforce - CRAI's success is heavily reliant on its ability to attract and retain talent, with 74% of senior staff holding advanced degrees [6] - As of the end of 2024, CRAI employed 946 consulting staff, including 151 officers, 552 senior staff, and 243 junior staff [6] Group 5: Shareholder Returns - The company has consistently increased its dividend payouts, with payments of $9.6 million in 2022, $10.8 million in 2023, and $12.3 million in 2024 [7] - Dividend per share has risen from $1.24 in 2022 to $1.75 in 2024, demonstrating a commitment to enhancing shareholder returns [7]

Core Insights - Charles River Associates (CRAI) shares have increased by 20.7%, outperforming the industry decline of 9.4% and the Zacks S&P 500 Composite rise of 10% [1] - CRAI reported strong fourth-quarter 2024 results with adjusted EPS of $2.03, exceeding the Zacks Consensus Estimate by 27.7% and showing a year-over-year increase of 24.5% [1] - Revenues reached $176.4 million, surpassing the consensus mark by 6.1% and rising more than 9.2% from the previous year [1] Business Performance - The growing demand for specialized advisory services in a complex global marketplace is beneficial for CRAI [2] - The company's focus on attracting top talent and innovation positions it for significant growth [2] - CRAI's expertise is expected to see rising demand as industries navigate technological advancements and regulatory complexities [3] Client Relationships and Operations - CRAI's strategy of strengthening client relationships across its primary business lines enhances customer retention and brand image [4] - The company delivers consistent value by streamlining internal operations to improve efficiency [4] Geographic Presence - CRAI's geographic reach in North America and Europe allows it to serve a diverse client base and cater to various industrial and regional demands [5] Dividend and Share Repurchase - The company has steadily increased its dividend payouts, from $9.6 million in 2022 to $12.3 million in 2024, with dividend per share growing from $1.24 in 2022 to $1.75 in 2024 [6] - Share repurchase activity has also been consistent, with $27.6 million in 2022, $31.4 million in 2023, and $33.3 million in 2024 [7] Challenges - The company faces higher talent costs due to a competitive market and is heavily dependent on foreign talent [8] - Advancements in automation and AI may reduce clients' reliance on consulting services [8] Liquidity Position - CRAI's liquidity is challenged by significant short-term debt of $60 million against cash reserves of only $24 million, resulting in a current ratio of 1.07, below the industry average of 1.19 [9][11]

Group 1 - Zacks Premium offers various tools for investors to enhance their stock market strategies, including daily updates, research reports, and stock screens [1] - The Zacks Style Scores are designed to help investors select stocks with the highest potential to outperform the market over the next 30 days [2] Group 2 - Stocks are rated based on value, growth, and momentum characteristics, with scores ranging from A to F, where A indicates the highest potential for outperformance [3] - The Value Score focuses on identifying undervalued stocks using financial ratios like P/E and Price/Sales [3] - The Growth Score assesses a company's financial health and future outlook based on earnings and sales projections [4] - The Momentum Score identifies optimal entry points for stocks based on price trends and earnings estimate changes [5] - The VGM Score combines all three Style Scores to provide a comprehensive assessment of stocks [6] Group 3 - The Zacks Rank utilizes earnings estimate revisions to guide investors in building successful portfolios, with 1 (Strong Buy) stocks achieving an average annual return of +25.41% since 1988 [7][8] - Investors are encouraged to focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for the best chances of significant returns [10] - Stocks with lower ranks, even with high Style Scores, may still face downward price pressure due to negative earnings forecasts [11] Group 4 - CRA International (CRAI) is highlighted as a 2 (Buy) stock with a VGM Score of A, indicating strong potential for growth investors [12] - CRAI is projected to have a year-over-year earnings growth of 2% for the current fiscal year, with upward revisions in earnings estimates from analysts [13] - The Zacks Consensus Estimate for CRAI has increased by $0.23 to $7.75 per share, with an average earnings surprise of 25.9% [13]

Group 1: Investment Strategy - The Zacks Rank system focuses on earnings estimates and revisions to identify winning stocks, while also considering trends in value, growth, and momentum [1] - Value investing is a popular strategy that relies on traditional analysis of key valuation metrics to find undervalued stocks [2] Group 2: Charles River Associates (CRAI) Overview - CRAI has a Zacks Rank of 2 (Buy) and an A grade for Value, indicating it is among the best value stocks [4] - The stock has a P/E ratio of 22.85, compared to the industry average of 25.32, suggesting it is undervalued [4] - CRAI's Forward P/E has ranged from 21.59 to 28.96 over the past year, with a median of 25.08 [4] Group 3: Valuation Metrics - CRAI's PEG ratio is 1.43, lower than the industry average of 1.90, indicating favorable growth expectations [5] - The P/B ratio for CRAI is 5.68, compared to the industry average of 6.51, suggesting an attractive valuation [6] - CRAI's P/S ratio is 1.7, slightly below the industry average of 1.72, indicating competitive sales performance [7] - The P/CF ratio for CRAI is 16.60, lower than the industry average of 18.69, highlighting its strong cash flow outlook [8] Group 4: Investment Outlook - The combination of these metrics suggests that CRAI is likely undervalued, making it one of the strongest value stocks in the market [9]

Company Overview - CRA International, Inc. (CRAI) has experienced a stock gain of 36% over the past year, significantly outperforming the industry, which saw an 8% decline [1] - The company holds a Growth Score of A, indicating strong quality and sustainability in its growth, with an expected long-term earnings growth rate of 16% [1] Market Position and Growth Potential - CRAI operates as a small player in the consulting and research services sector, benefiting from a growing demand for specialized advisory services in a complex global marketplace [2] - The company's strong reputation for high-quality analytical and strategic consulting services positions it well for future growth [2] Talent and Innovation - CRAI's success is heavily reliant on its ability to attract and retain top talent, with 74% of its senior staff holding advanced degrees [4] - The company focuses on innovation and client-centered solutions, which is crucial as industries face rapid technological advancements and regulatory complexities [3] Financial Performance and Shareholder Returns - CRAI has consistently increased its dividend payouts, from $9.6 million in 2022 to $12.3 million in 2024, with dividend per share rising from $1.24 to $1.75 in the same period [5] - Share repurchase activity has also shown consistency, with $27.6 million repurchased in 2022, increasing to $33.3 million in 2024, reflecting the company's commitment to long-term value creation [6] Competitive Landscape - CRAI faces significant competition from larger firms like McKinsey & Company and Boston Consulting Group, which have more resources to compete on price and invest in technology [7] - The competitive talent market is increasing costs for consulting services, and advancements in automation and AI may reduce clients' dependence on consulting firms [8]