Maximus Stock Rises 5.6% Despite Q4 Earnings Missing Estimates

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. QuoteQuarterly 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 MaximusThe 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 PipelineYear-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 PerformanceOperating 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 FlowMaximus 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 GuidanceFor 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 SnapshotOmnicom 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.Free Report: Profiting from the 2nd Wave of AI ExplosionThe next phase of the AI explosion is poised to create significant wealth for investors, especially those who get in early. It will add literally trillion of dollars to the economy and revolutionize nearly every part of our lives.Investors who bought shares like Nvidia at the right time have had a shot at huge gains.But the rocket ride in the "first wave" of AI stocks may soon come to an end. The sharp upward trajectory of these stocks will begin to level off, leaving exponential growth to a new wave of cutting-edge companies.Zacks' AI Boom 2.0: The Second Wave report reveals 4 under-the-radar companies that may soon be shining stars of AI’s next leap forward.Access AI Boom 2.0 now, absolutely free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ManpowerGroup Inc. (MAN): Free Stock Analysis Report Omnicom Group Inc. (OMC): Free Stock Analysis Report Maximus, Inc. (MMS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks