Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investors often face challenges in determining the right entry point for fast-moving stocks, which can lead to limited upside or potential losses [2] - Investing in bargain stocks that exhibit recent price momentum can be a safer strategy, utilizing tools like the Zacks Momentum Style Score to identify promising stocks [3] Group 2: Great Lakes Dredge & Dock (GLDD) Analysis - GLDD has shown a four-week price change of 6.4%, indicating growing investor interest and positioning it well in the market [4] - Over the past 12 weeks, GLDD's stock gained 1.7%, and it has a beta of 1.4, suggesting it moves 40% more than the market in either direction [5] - GLDD has a Momentum Score of B, indicating a favorable time to invest based on momentum [6] Group 3: Earnings Estimates and Valuation - GLDD has received a Zacks Rank 1 (Strong Buy) due to upward revisions in earnings estimates, which typically attract more investor interest [7] - The stock is currently trading at a Price-to-Sales ratio of 0.97, suggesting it is undervalued as investors pay only 97 cents for each dollar of sales [7] Group 4: Additional Investment Opportunities - Besides GLDD, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [8] - Zacks offers over 45 Premium Screens tailored to different investing styles, which can help identify potential winning stocks [9]

Core Insights - Robert F. Abbott has been managing family investments since 1995 and expanded his strategy to include options trading in 2010, focusing on covered calls and collars with long stocks [1] Group 1 - Robert F. Abbott is a freelance writer and operates a website aimed at providing information for new and intermediate-level mutual fund investors [1] - Abbott holds a Bachelor of Arts and a Master of Business Administration (MBA) degree [1] - He resides in Airdrie, Alberta, Canada [1]

Core Insights - Value investors traditionally use the price-to-earnings (P/E) ratio to identify value stocks, but for loss-making companies, the price-to-sales (P/S) ratio is more relevant. The price-to-book (P/B) ratio is also a useful tool for identifying undervalued stocks with high return potential [1][5][9]. Valuation Ratios - The P/B ratio is calculated as market capitalization divided by book value of equity, helping to identify low-priced stocks with high growth prospects [2][5]. - A P/B ratio of less than one indicates that a stock is trading below its book value, suggesting it may be undervalued, while a ratio above one may indicate overvaluation [5][6]. - The P/B ratio is particularly useful for industries with tangible assets, such as finance and manufacturing, but can be misleading for companies with high R&D expenses or significant debt [8]. Book Value Definition - Book value represents the total value remaining for shareholders if a company were to liquidate its assets after settling all liabilities, calculated by subtracting total liabilities from total assets [3][4]. Screening Parameters - Stocks with a P/B ratio lower than the industry median are considered to have potential for price appreciation [11]. - Additional screening criteria include a P/S ratio below the industry median, a P/E ratio below the industry median, a PEG ratio less than 1, a current price of at least $5, an average 20-day volume of at least 100,000, and a Zacks Rank of 1 or 2 [12][13][14]. Selected Stocks - Five stocks identified with low P/B ratios and solid growth potential include: - **StoneCo (STNE)**: Financial technology solutions provider with a projected 3-5 year EPS growth rate of 30.3% and a Zacks Rank of 2 [15]. - **Great Lakes Dredge & Dock (GLDD)**: Largest U.S. dredging services provider with a projected EPS growth rate of 12.0% and a Zacks Rank of 1 [16]. - **EnerSys (ENS)**: Manufacturer of industrial batteries with a projected EPS growth rate of 15.0% and a Zacks Rank of 2 [17]. - **MillerKnoll (MLKN)**: Design solutions provider with a projected EPS growth rate of 12.0% and a Zacks Rank of 2 [17]. - **Keros Therapeutics (KROS)**: Clinical-stage biotech with a projected EPS growth rate of 23.6% and a Zacks Rank of 1 [18].

Market Overview - The U.S. Senate's actions to resolve the government shutdown have restored access to delayed official data, leading to increased investor optimism regarding economic indicators related to inflation, employment, and Federal Reserve actions [1] - Major U.S. stock indexes experienced significant gains, with the S&P 500 rising 1.5% to 6,832.43, the Nasdaq Composite gaining 2.3% to 23,527.17, and the Dow Jones Industrial Average increasing 0.8% to 47,368.63, reflecting renewed confidence in the economy [2] Value Stocks - The change in market sentiment has enhanced the attractiveness of value stocks, which typically benefit from stabilizing economic conditions and reduced market volatility [3] - Companies such as Great Lakes Dredge & Dock Corporation (GLDD), StoneCo Ltd. (STNE), PG&E Corporation (PCG), and Pan American Silver Corp. (PAAS) are highlighted for their low Price to Cash Flow (P/CF) ratios, indicating strong potential for recovery as investors recognize their inherent value [4][10] Price to Cash Flow Ratio - The P/CF ratio is emphasized as a critical metric for evaluating a company's financial health, as it assesses the market price of a stock relative to its cash flow per share, with lower values being more favorable [7][11] - Positive cash flow is indicative of a company's ability to manage debt, reinvest, and provide returns to shareholders, while negative cash flow suggests liquidity issues [9] Investment Strategy - A comprehensive investment strategy should not rely solely on the P/CF metric; it should also incorporate other valuation metrics such as price-to-earnings (P/E), price-to-book (P/B), and price-to-sales (P/S) ratios to avoid value traps [10][11] - Parameters for selecting true-value stocks include a P/CF ratio less than or equal to the industry median, a minimum stock price of $5, and a Zacks Rank of 1 or 2, which indicates strong buy potential [11][14] Company Performance Highlights - Great Lakes Dredge & Dock (GLDD) has a trailing four-quarter earnings surprise of 65.5% and is projected to see sales and EPS growth of 11.6% and 31%, respectively [15][16] - StoneCo (STNE) has a trailing earnings surprise of 9.1% and is expected to grow sales and EPS by 11.8% and 24.4%, respectively, with shares having rallied 47.9% in the past year [16][17] - PG&E Corporation (PCG) has a trailing earnings surprise of 0.5% and is projected for sales and EPS growth of 6.7% and 10.3%, respectively, despite a 21.9% decline in shares over the past year [17][18] - Pan American Silver (PAAS) has a trailing earnings surprise of 45.2% and is expected to see significant growth in sales and EPS of 23.9% and 173.4%, respectively, with shares surging 70% in the past year [18][19]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Characteristics - Momentum investing can be risky as stocks may lose momentum when their valuations exceed future growth potential [2] - A safer approach involves investing in bargain stocks that exhibit recent price momentum, identified through the Zacks Momentum Style Score [3] Group 2: Great Lakes Dredge & Dock (GLDD) Analysis - GLDD has shown a four-week price change of 5%, indicating growing investor interest [4] - The stock gained 7.2% over the past 12 weeks, demonstrating its ability to deliver positive returns over a longer timeframe [5] - GLDD has a beta of 1.4, suggesting it moves 40% higher than the market in either direction, indicating fast-paced momentum [5] - The stock has a Momentum Score of A, suggesting it is an opportune time to invest [6] Group 3: Earnings Estimates and Valuation - GLDD has a Zacks Rank 1 (Strong Buy) due to upward revisions in earnings estimates, which attract more investors [7] - The stock is trading at a Price-to-Sales ratio of 0.99, indicating it is reasonably valued at 99 cents for each dollar of sales [7] Group 4: Additional Investment Opportunities - Besides GLDD, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [8] - Investors can explore over 45 Zacks Premium Screens tailored to different investing styles to identify potential winning stocks [9]

Core Viewpoint - Great Lakes Dredge & Dock (GLDD) has been upgraded to a Zacks Rank 1 (Strong Buy), indicating a positive outlook based on rising earnings estimates, which are a significant driver of stock prices [1][3]. Earnings Estimates and Stock Performance - The Zacks rating system emphasizes the importance of earnings estimate revisions in influencing near-term stock price movements, making it a valuable tool for investors [2][4]. - The recent upgrade for GLDD reflects an improvement in its underlying business, which is expected to lead to increased stock prices as investor sentiment becomes more favorable [5][10]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 stocks historically generating an average annual return of +25% since 1988 [7]. - Only the top 5% of Zacks-covered stocks receive a "Strong Buy" rating, indicating superior earnings estimate revisions and potential for market-beating returns [9][10]. Earnings Estimate Revisions for GLDD - For the fiscal year ending December 2025, GLDD is expected to earn $1.10 per share, with no year-over-year change; however, the Zacks Consensus Estimate has increased by 10.8% over the past three months, reflecting positive sentiment among analysts [8].

Core Viewpoint - Great Lakes Dredge & Dock (GLDD) has shown strong stock performance, with a 9.4% increase over the past month and a 13.1% gain since the start of the year, outperforming both the Zacks Construction sector and the Zacks Building Products - Heavy Construction industry [1] Financial Performance - The company has consistently beaten earnings estimates, reporting an EPS of $0.26 against a consensus estimate of $0.17 in its last earnings report [2] - For the current fiscal year, GLDD is expected to post earnings of $1.02 per share on revenues of $845.81 million, reflecting a 21.43% change in EPS and a 10.9% change in revenues [3] - For the next fiscal year, earnings are projected to remain at $1.02 per share with revenues increasing to $880.7 million, indicating a year-over-year change of 0% in EPS and 4.13% in revenues [3] Valuation Metrics - The stock trades at 12.6 times current fiscal year EPS estimates, significantly lower than the peer industry average of 25.2 times [7] - On a trailing cash flow basis, GLDD trades at 6.9 times compared to the peer group's average of 15.9 times [7] - The company has a PEG ratio of 1.05, positioning it favorably among value stocks [7] Investment Ratings - GLDD holds a Value Score of A, a Growth Score of A, and a Momentum Score of F, resulting in a combined VGM Score of A [6] - The stock has a Zacks Rank of 2 (Buy), supported by favorable earnings estimate revisions from analysts [8] - Given the Zacks Rank and Style Scores, GLDD appears to be a promising investment opportunity in the near future [9]

Financial Performance - Contract revenues for Q3 2025 were $195.2 million, a 2% increase from $191.2 million in Q3 2024[11] - Gross profit for Q3 2025 was $43.8 million, up 21% from $36.2 million in Q3 2024[11] - Net income for Q3 2025 reached $17.7 million, compared to $8.9 million in Q3 2024, representing a 99% increase[11] - Basic earnings per share for Q3 2025 were $0.27, up from $0.13 in Q3 2024[11] - Operating income for the nine months ended September 30, 2025, was $95.2 million, compared to $62.8 million for the same period in 2024, reflecting a 52% increase[11] - The company reported a comprehensive income of $18.4 million for Q3 2025, compared to $6.2 million in Q3 2024[13] - Net income for the nine months ended September 30, 2025, was $60,835,000, compared to $37,549,000 for the same period in 2024, representing a 62% increase[22] - Basic earnings per share for the nine months ended September 30, 2025, was $0.91, compared to $0.56 for the same period in 2024, marking a 62.5% increase[34] - Adjusted EBITDA for Q3 2025 was 20.1%, up from 14.1% in Q3 2024[116] - Adjusted EBITDA for Q3 2025 was $39.3 million, up $12.3 million from $27.0 million in Q3 2024[133] Assets and Liabilities - Total current assets decreased to $229.8 million as of September 30, 2025, down from $263.4 million at the end of 2024[9] - Total liabilities decreased to $765.6 million as of September 30, 2025, compared to $806.2 million at the end of 2024[9] - Total equity increased to $502.1 million as of September 30, 2025, up from $448.9 million at the end of 2024[9] - The company’s long-term debt decreased to $415.3 million as of September 30, 2025, down from $448.2 million at the end of 2024[9] - The company had a total of $40,455,000 in accrued expenses as of September 30, 2025, slightly down from $41,640,000 at the end of 2024[37] Cash Flow and Investments - Cash provided by operating activities increased to $166,930,000 for the nine months ended September 30, 2025, up from $83,581,000 in 2024, indicating a 100% growth[22] - Cash used in investing activities totaled $115,220,000 for the nine months ended September 30, 2025, compared to $93,203,000 in 2024, representing a 23.6% increase[22] - The company reported cash, cash equivalents, and restricted cash of $12,671,000 at the end of the period, up from $12,037,000 at the end of 2024[22] - The company incurred $19,614,000 in cash paid for interest during the nine months ended September 30, 2025, compared to $17,452,000 in 2024, a 12.3% increase[22] Backlog and Revenue Streams - As of September 30, 2025, the company had a total dredging backlog of $934.5 million, excluding $193.5 million of domestic low bids pending formal award[81] - The company expects to convert the majority of its dredging backlog and all offshore energy backlog into revenue by the end of 2026[81] - Dredging revenues for the three months ended September 30, 2025, were $189.083 million, slightly down from $191.173 million in 2024, a decrease of approximately 1.1%[84] - The federal government accounted for $90.306 million of revenues in Q3 2025, up from $85.876 million in Q3 2024, reflecting a growth of about 5.0%[84] - The Company’s contracted dredging backlog was $934.5 million as of September 30, 2025, down from $1.2 billion at December 31, 2024[140] Shareholder Activities - The company repurchased 1,312,493 shares of common stock for approximately $11.6 million during the nine months ended September 30, 2025, as part of a $50 million share repurchase program[27] - The Company believes its cash and cash equivalents, anticipated cash flows, and revolving credit facility will be sufficient to fund operations and capital expenditures for the next twelve months[155] Debt and Credit Facilities - The Company secured a senior secured second-lien term loan facility of $100.0 million, fully funded on the Closing Date, with net proceeds of approximately $88.7 million after costs[39] - The ABL Credit Agreement provides for a senior secured revolving credit facility with an aggregate principal amount of up to $300.0 million, which was increased to $330.0 million in May 2025[50] - The Company had $271.1 million of availability under the ABL Credit Agreement as of September 30, 2025, compared to $221.2 million as of December 31, 2024[56] - The Company had no borrowings on the revolver as of September 30, 2025, compared to $35.0 million as of December 31, 2024[56] Operational Developments - The Acadia, the first Jones Act subsea rock installation vessel, was launched in July 2025 and is expected to be operational in 2026[110] - The company has secured contracts for full utilization of the Acadia for 2026 and is actively bidding for projects in 2027 and beyond[111] - The company anticipates continued growth in offshore energy capabilities despite potential delays in U.S. offshore wind projects due to recent legislative changes[113] Compliance and Governance - The certifications pursuant to the Sarbanes-Oxley Act of 2002 were included in the report, ensuring compliance with financial reporting standards[171] - The report was signed by Scott Kornblau, Senior Vice President and Chief Financial Officer, on November 4, 2025[174]

Financial Data and Key Metrics Changes - The company reported revenues of $195.2 million for Q3 2025, an increase of $4 million from the prior year's third quarter [9] - Adjusted EBITDA for the quarter was $39.3 million, with an adjusted EBITDA margin of 20.1% [9] - Net income for Q3 2025 was $17.7 million, up from $8.9 million in the prior year quarter [10] - Gross profit increased to $43.8 million, with a gross profit margin of 22.4%, compared to $36.2 million and 19% in Q3 2024 [10] Business Line Data and Key Metrics Changes - The dredging backlog stood at $935 million, with 84% allocated to capital and coastal protection projects [4] - New project awards during Q3 totaled $136 million, contributing to a high-quality backlog [4] - The offshore energy team commenced rock placement operations, indicating growth in this segment [5] Market Data and Key Metrics Changes - The 2025 dredging bid market is expected to normalize at approximately $1.8 billion, focusing on coastal protection projects funded by the 2023 Disaster Relief Supplemental Appropriations Act [16] - The company has secured full utilization for the Acadia in 2026, indicating strong demand in the offshore wind market [17] Company Strategy and Development Direction - The company aims to maintain operational momentum and expects 2025 to be the highest EBITDA year in its history [13] - The strategic focus includes expanding into offshore energy services, particularly for protecting critical subsea infrastructure [17] - The company is diversifying its client portfolio, achieving a balance of 50% private and 50% federal government-funded work [44] Management's Comments on Operating Environment and Future Outlook - Management noted that operations remain unaffected by the current government shutdown, with timely payments and ongoing project execution [5][15] - The company anticipates a strong fourth quarter, despite two hopper dredges undergoing dry dock [12][55] - There is optimism regarding the 2026 bid market, with expectations for new port deepening projects to commence bidding towards the end of 2026 [32] Other Important Information - The company completed the refinancing and upsizing of its revolving credit facility to $430 million, extending maturity to 2030 [6] - Total capital expenditures for Q3 were $32.8 million, with full-year guidance remaining between $140-$150 million [11] Q&A Session Summary Question: Bidding trends and order trajectory for dredging - Management expects bidding to continue normally for maintenance dredging and coastal protection projects, despite a reduction in the overall bid market size [21] Question: Cash interest expense and GAAP interest expense convergence - The company anticipates a reduction in cash interest expense due to the repayment of the second lien term loan, with a projected interest expense of about $11 million in Q4 [22] Question: Payment issues during government shutdown - Management clarified that the U.S. Army Corps of Engineers has a majority of its workforce funded through project-based accounts, allowing for normal payment processes [28] Question: 2026 bid market outlook - The company expects the 2026 bid market to include maintenance-related work and coastal protection projects, with new port deepening projects likely to commence bidding in 2027 [32] Question: Success in securing contracts with non-wind-oriented customers - Management indicated that while contracts are still a work in progress, they have been actively bidding in Europe for cable protection projects [34] Question: Comparison of Q4 expectations to Q1 - Management noted that Q4 is expected to be extremely strong, with most vessels working throughout the quarter [40] Question: Coastal protection market and upcoming bidding opportunities - The company sees numerous beach restoration and coastal protection projects coming out to bid, supported by different funding streams [44]

Core Insights - Great Lakes Dredge & Dock (GLDD) reported quarterly earnings of $0.26 per share, exceeding the Zacks Consensus Estimate of $0.17 per share, and up from $0.13 per share a year ago [1][2] - The company experienced an earnings surprise of +52.94% for the quarter, having surpassed consensus EPS estimates in all four of the last quarters [2] - Revenues for the quarter were $195.21 million, which fell short of the Zacks Consensus Estimate by 3.08%, but showed an increase from $191.17 million year-over-year [3] Earnings Performance - The earnings surprise of +52.94% indicates strong performance relative to expectations, with a previous quarter's surprise of +75% [2] - Over the last four quarters, GLDD has consistently exceeded consensus EPS estimates [2] Revenue Analysis - The reported revenue of $195.21 million missed the consensus estimate, contrasting with the year-ago figure of $191.17 million [3] - The company has topped consensus revenue estimates in two of the last four quarters [3] Stock Performance and Outlook - Since the beginning of the year, GLDD shares have increased by approximately 0.8%, underperforming the S&P 500's gain of 16.5% [4] - The future performance of the stock will largely depend on management's commentary during the earnings call and the earnings outlook [4][5] Earnings Estimates and Industry Context - Current consensus EPS estimate for the upcoming quarter is $0.23 on revenues of $207.85 million, and for the current fiscal year, it is $1.02 on revenues of $845.81 million [8] - The Building Products - Heavy Construction industry, to which GLDD belongs, is currently ranked in the top 32% of over 250 Zacks industries, indicating a favorable industry outlook [9] Competitor Insights - Tutor Perini (TPC), another company in the same industry, is expected to report quarterly earnings of $0.96 per share, reflecting a year-over-year increase of +150% [10] - TPC's anticipated revenues are projected to be $1.34 billion, up 24.1% from the previous year [11]