Core Thesis - Tetra Tech, Inc. (TTEK) is viewed as a compelling investment opportunity due to its resilience as a global engineering and consulting firm focused on water, environmental, and sustainable infrastructure solutions [2][6] Financial Performance - As of December 1st, TTEK's share price was $34.48, with trailing and forward P/E ratios of 37.10 and 22.57 respectively [1] - EPS is projected to grow by 10-11% in 2026, even in a worst-case scenario without USAID recovery [3] - Projected EPS is around $2 by 2027, indicating potential for multiple expansion and sustainable long-term returns [6] Revenue Diversification - The company's revenue is diversified across various sectors: 30% from U.S. federal, 10% from state and local, 10% from commercial, and 40% from international markets [2] - This diversification helps mitigate risks from funding cuts, such as the recent 40% drop in stock value due to USAID funding cuts [2] Operational Strategy - TTEK's asset-light, labor-intensive model generates exceptional free cash flow, supporting continued mergers and acquisitions in digital water and industrial automation [4] - The company is embedded in multi-year, multi-award contracts, which support high-single-digit organic growth and margin improvement [3] Market Position and Competitive Advantage - TTEK's expertise in complex water and environmental projects, along with proprietary digital solutions and strong client relationships, creates a significant competitive moat [5] - The early adoption of digital automation and AI positions TTEK ahead of its peers [5] Growth Catalysts - Near-term catalysts for growth include U.S. federal task-order conversion, UK AMP8 ramp, state and local water funding, PFAS regulatory work, and increased demand for disaster response [6] - Structural tailwinds such as water scarcity, climate resilience, and regulatory compliance support durable demand across U.S. federal, state, and international markets [4]