The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks. ...

Group 1 - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] - Fast-moving trending stocks can be risky if their valuations exceed future growth potential, leading to potential losses for investors [2] - A safer strategy involves investing in bargain stocks that exhibit recent price momentum, identified through the Zacks Momentum Style Score [3] Group 2 - DLH Holdings Corp. (DLHC) has shown significant recent price momentum with a four-week price change of 41.2%, indicating strong investor interest [4] - DLHC has gained 1.8% over the past 12 weeks and has a beta of 1.33, suggesting it moves 33% more than the market [5] - DLHC has a Momentum Score of B, indicating a favorable time to invest based on its momentum characteristics [6] Group 3 - DLHC has received a Zacks Rank 2 (Buy) due to upward revisions in earnings estimates, which attract more investor interest [7] - The stock is trading at a low Price-to-Sales ratio of 0.19, meaning investors pay only 19 cents for each dollar of sales, indicating a reasonable valuation [7] - DLHC is positioned for potential growth at a fast pace, with other stocks also passing the 'Fast-Paced Momentum at a Bargain' screen [8]

Revenue Performance - Revenue for the three months ended March 31, 2025, was $89.2 million, a decrease of 11.7% compared to $101.0 million for the same period in 2024[9] - Revenue for the six months ended March 31, 2025, was $179,994,000, down 9.5% from $198,857,000 in the prior year[9] - Total revenue for the three months ended March 31, 2025, was $89,212 thousand, a decrease of 11.7% compared to $101,007 thousand for the same period in 2024[58] - Revenue from the Department of Health and Human Services for the six months ended March 31, 2025, was $86,745 thousand, down from $91,636 thousand in 2024, a decline of about 5.0%[58] Net Income and Earnings Per Share - Net income for the six months ended March 31, 2025, was $1.99 million, down 49.8% from $3.96 million for the same period in 2024[9] - The company reported a net income per share of $0.06 for the three months ended March 31, 2025, compared to $0.13 for the same period in 2024[9] - For the three months ended March 31, 2025, net income was $878,000, a decrease of 51.5% compared to $1,812,000 for the same period in 2024[9] - Basic net income per share for the six months ended March 31, 2025, was $0.14, compared to $0.28 for the same period in 2024, reflecting a 50% decrease[9] - The net income for the six months ended March 31, 2025, was reported at $878,000, a decrease from $1,992,000 for the same period in the previous year, indicating a decline of about 56%[18] Operating Costs and Expenses - Total operating costs for the three months ended March 31, 2025, were $84.1 million, a decrease of 11.6% from $95.1 million in the same period of 2024[9] - Total lease costs for the six months ended March 31, 2025, were $1,949 thousand, compared to $1,798 thousand for the same period in 2024, an increase of approximately 8.4%[60] - Stock-based compensation expense for the three months ended March 31, 2025, totaled $533,000, down from $954,000 in the same period of 2024, representing a decline of 44.1%[83] Assets and Liabilities - Total assets as of March 31, 2025, were $306.6 million, a decrease from $314.4 million as of September 30, 2024[12] - The company had total liabilities of $193.8 million as of March 31, 2025, compared to $204.2 million as of September 30, 2024[12] - Current assets increased to $55,038,000 as of March 31, 2025, from $52,957,000 as of September 30, 2024[12] - Total liabilities decreased to $193,758,000 as of March 31, 2025, compared to $204,249,000 as of September 30, 2024[12] Cash Flow and Operating Activities - Cash at the end of the period was $196,000, down from $342,000 at the beginning of the period[14] - The company provided $2.97 million in net cash from operating activities for the six months ended March 31, 2025, down from $10.3 million for the same period in 2024[14] - The company reported a net cash provided by operating activities of $2,965,000 for the six months ended March 31, 2025, compared to $10,301,000 in the prior year[15] Shareholders' Equity - Shareholders' equity increased to $112.8 million as of March 31, 2025, from $110.1 million as of September 30, 2024[12] - As of March 31, 2025, the total shareholders' equity increased to $112,849,000 from $110,132,000 as of September 30, 2024, reflecting a growth of approximately 2.5%[18] - The balance of retained earnings increased to $11,840,000 as of March 31, 2025, compared to $9,848,000 as of September 30, 2024, representing a growth of approximately 20.2%[18] Goodwill and Intangible Assets - The company performed a goodwill impairment evaluation and determined that its fair value exceeded its book value, indicating no impairment[38] - The balance of goodwill remained unchanged at approximately $138.2 million as of March 31, 2025, and September 30, 2024[65] - Total intangible assets, net decreased to $100,093,000 as of March 31, 2025, from $108,321,000 as of September 30, 2024, a decline of approximately 7%[66] Debt and Interest Expenses - The secured term loan balance was $137,750,000 as of March 31, 2025, with a fixed interest rate of 4.1%[75] - Interest expense for the three months ended March 31, 2025, was $3,877,000, a decrease of 7.5% compared to $4,190,000 for the same period in 2024[73] - Interest expense for the six months ended March 31, 2025, was $8,010,000, a decrease from $8,848,000 in the same period of 2024[9] Compliance and Regulations - The company is in compliance with all loan covenants and restrictions as of March 31, 2025[77] - The company has not identified any significant related party transactions for the six months ended March 31, 2025[96] Stock-Based Compensation - The company granted 312,906 restricted stock units during the six months ended March 31, 2025, compared to 169,544 in the same period of 2024[85] - Unrecognized stock-based compensation expense was $4,876,000 as of March 31, 2025, down from $7,385,000 in 2024, indicating a decrease of 34.1%[89]

Core Viewpoint - DLH Holdings Corp. has been awarded a five-year task order valued at up to $37.7 million to provide scientific research and development services for the Telemedicine and Advanced Technology Research Center, focusing on improving medical outcomes for military personnel [1][2]. Group 1: Contract Details - The contract is part of the OMNIBUS IV procurement vehicle and will enable DLH to deliver a range of technology-enabled solutions, including AI modeling, bioengineering, and cyber security [2]. - The task order emphasizes DLH's long-standing partnership with the medical research and development community, showcasing its capability to address readiness challenges through advanced engineering solutions [2][3]. Group 2: Company Positioning - DLH is recognized as an industry leader in information systems and scientific research, with a focus on merging technology with medical research to enhance military health systems [3]. - The company aims to leverage its cutting-edge capabilities to pursue similar opportunities across military health and adjacent markets, indicating a strategic alignment with military missions [4]. Group 3: Company Overview - DLH, a Russell 2000 company, specializes in enhancing technology, public health, and cyber security readiness through various solutions and services, employing over 2,400 staff dedicated to mission-critical operations [5].

DLH (DLHC) Q2 2025 Earnings Call May 08, 2025 10:00 AM ET Company Participants Chris Witty - Managing Director - Investor RelationsZachary Parker - President & CEOKathryn Johnbull - CFO Conference Call Participants Joe Gomes - Senior Generalist Analyst Operator Good morning, and welcome to the DLH Fiscal twenty twenty five Second Quarter Earnings Conference Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is ...

Financial Data and Key Metrics Changes - The company reported revenue of $89.2 million for Q2 2025, down from $101 million in the prior year, primarily due to the conversion of certain VA and DoD programs to small business set-aside contracts [15][16] - EBITDA for Q2 2025 was $9.4 million, compared to $10.2 million in the previous year, reflecting lower overall revenue levels [17][18] - Operating cash generation was strong at $14.5 million for the quarter, contributing to a total cash flow of $3 million year-to-date [18][19] - The company reduced its debt by $15.3 million during the quarter, ending with $151.7 million outstanding [19] Business Line Data and Key Metrics Changes - The technology services revenue grew over Q1 results, despite a decrease in overall revenue due to small business set-aside conversions [15][16] - The company is under contract to manage five CMOP locations through October 2025, with revenue run rates expected to be around $23 to $25 million for the remaining locations [26][27] Market Data and Key Metrics Changes - The company has over $1 billion in contracts under review, with expected award decisions in the second half of the fiscal year [11] - The new business pipeline remains healthy with estimated opportunities of $3.5 billion across various market areas [13] Company Strategy and Development Direction - The company aims to leverage its advanced capabilities and new business pipeline to align with the current administration's goals, focusing on efficiency and cost reduction [9][12] - The strategy includes moving up the margin scale in a large market by providing unique, comprehensive solutions [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the alignment of the company's capabilities with the administration's priorities, despite uncertainties in government programs and budget cuts [9][10] - The company anticipates a neutral to slightly positive budgetary impact from the new administration, with ongoing demand for its technology-enabled applications [29][30] Other Important Information - The company has made all mandatory debt payments through March 2026, a year ahead of schedule, and continues to benefit from financial flexibility due to an amended credit facility [7][19] - Management is closely monitoring changes in contract administration resources at customer agencies to protect cash flow generation [19] Q&A Session Summary Question: What is the revenue run rate for CMOP contracts for the rest of the year? - The company expects the quarterly run rate to be around $23 to $25 million for the remaining locations [26] Question: How is the company impacted by NIH's shutdown of the long-term women's health study? - The company was not involved in that study and expects the overall budgetary impact from the new administration to be neutral to slightly positive [28][29] Question: What is the status of the $76 million Navy award contract? - The contract is continuing to grow, with ongoing phases of work being implemented [39][40] Question: Are the upcoming $1 billion awards related to IDIQs? - Yes, the company is seeing continued activity related to IDIQs, with more RFPs expected to be released [43][44]

FY2025 Second Quarter Earnings Three Months Ended 3.31.25 May 8, 2025 CONFIDENTIAL & PROPRIETARY © Copyright 2025 DLH Holdings Corp. All Rights Reserved. 1 President and Chief Executive Officer Kathryn JohnBull Chief Financial Officer 2 CONFIDENTIAL & PROPRIETARY © Copyright 2025 DLH Holdings Corp. All Rights Reserved. Forward-Looking Statements Call Participants Zach Parker "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: This press release may contain forward-looking sta ...

Group 1: Earnings Performance - DLH Holdings Corp. reported quarterly earnings of $0.06 per share, missing the Zacks Consensus Estimate of $0.07 per share, and down from $0.12 per share a year ago, representing an earnings surprise of -14.29% [1] - The company posted revenues of $89.21 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 0.88%, and down from $101.01 million year-over-year [2] - Over the last four quarters, DLH has surpassed consensus EPS estimates only once and has not beaten consensus revenue estimates during the same period [2] Group 2: Stock Performance and Outlook - DLH shares have declined approximately 49.4% since the beginning of the year, compared to a decline of -4.7% for the S&P 500 [3] - The current consensus EPS estimate for the upcoming quarter is -$0.11 on revenues of $74 million, and -$0.13 on revenues of $320.78 million for the current fiscal year [7] - The estimate revisions trend for DLH is mixed, resulting in a Zacks Rank 3 (Hold), indicating that shares are expected to perform in line with the market in the near future [6] Group 3: Industry Context - The Staffing Firms industry, to which DLH belongs, is currently ranked in the bottom 15% of over 250 Zacks industries, suggesting that the outlook for the industry can significantly impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Revenue Performance - Second quarter revenue was $89.2 million in fiscal 2025, down from $101.0 million in fiscal 2024, reflecting a decrease of approximately 11.8% due to small business conversions[6] - Revenue for the six months ended March 31, 2025, was $179,994 million, down from $198,857 million in the same period of 2024, a decrease of 9.5%[29] Earnings and Profitability - Earnings for the second quarter were $0.9 million, or $0.06 per diluted share, compared to $1.8 million, or $0.12 per diluted share in the same quarter of fiscal 2024, representing a decline of 50%[10] - EBITDA for the second quarter was $9.4 million, down from $10.2 million in the prior-year period, reflecting a decrease of approximately 7.8%[11] - EBITDA for the six months ended March 31, 2025, was $19,324 million, compared to $21,257 million for the same period in 2024, a decline of 9.1%[29] - The company reported an operating margin of 5.7% for the second quarter of fiscal 2025, slightly down from 5.9% in the prior-year period[8] - EBITDA as a percentage of revenue remained stable at 10.7% for the six months ended March 31, 2025, compared to 10.7% for the same period in 2024[29] Cash Flow and Liquidity - The company generated $14.5 million of operating cash during the quarter, driven by strong accounts receivable collections[4] - Cash at the end of the period decreased to $196 million from $238 million, reflecting a decline of 17.6%[24] - Net cash provided by operating activities for the six months ended March 31, 2025, was $2,965 million, down from $10,301 million in the same period of 2024, a decrease of 71.2%[24] - The company reported a net change in cash of $(146) million for the six months ended March 31, 2025, compared to an increase of $23 million in the same period of 2024[24] Debt and Liabilities - Total debt was reduced by $15.3 million during the quarter, bringing it to $151.7 million as of March 31, 2025, compared to $167.0 million at the end of December 2024[4] - Total current liabilities decreased from $53,242 million on September 30, 2024, to $49,917 million on March 31, 2025, a reduction of approximately 6.2%[22] Assets and Equity - Total assets decreased from $314,381 million on September 30, 2024, to $306,607 million on March 31, 2025, a decline of approximately 2.5%[22] - Total shareholders' equity increased from $110,132 million on September 30, 2024, to $112,849 million on March 31, 2025, an increase of 2.5%[22] Contract and Business Outlook - Contract backlog as of March 31, 2025, was approximately $646.9 million, down from $690.3 million as of September 30, 2024[6] - The company has a robust pipeline with over $1.0 billion in new business proposals currently being evaluated[5] - The company anticipates converting 50-55% of EBITDA to debt reduction over the fiscal year[12] General and Administrative Expenses - General and administrative expenses decreased by $3.1 million year-over-year, from $11.7 million in fiscal 2024 to $8.6 million in fiscal 2025[8]

Core Insights - DLH Holdings Corp. reported a revenue of $89.2 million for the second quarter of fiscal 2025, down from $101.0 million in the same period of fiscal 2024, primarily due to the impact of small business set-aside transitions [6][7] - The company reduced its debt by approximately $15.3 million during the quarter, bringing total debt to $151.7 million, supported by $14.5 million in operating cash generated [4][12] - A significant increase in bid activity was noted following the enactment of a Continuing Resolution in March, with over $1.0 billion in new business proposals currently under evaluation [5] Financial Performance - Revenue for the second quarter of fiscal 2025 was $89.2 million, a decrease of $11.8 million compared to $101.0 million in fiscal 2024 [6][30] - Operating income was reported at $5.1 million, with an operating margin of 5.7%, slightly down from 5.9% in the prior year [7][30] - Net income for the quarter was approximately $0.9 million, or $0.06 per diluted share, compared to $1.8 million, or $0.12 per diluted share, in the same quarter of fiscal 2024 [10][30] Debt Management - The company utilized $14.5 million of operating cash to reduce debt, achieving a total debt reduction of $15.3 million during the quarter [4][12] - As of March 31, 2025, DLH's total debt stood at $151.7 million, down from $167.0 million at the end of December 2024 [12][6] - The company anticipates converting 50-55% of EBITDA to debt reduction throughout the fiscal year [12] Business Outlook - The company expects a higher volume of decision-making in the third and fourth quarters, which could lead to growth opportunities into fiscal 2026 [5] - DLH is well-positioned to benefit from the President's fiscal year 2026 discretionary funding request, particularly in advanced engineering, digital transformation, data analytics, and cybersecurity [5] - The contract backlog as of March 31, 2025, was approximately $646.9 million, down from $690.3 million as of September 30, 2024 [6][13]