RESTON, VA—Management consulting firm ICF International , Inc. (NASDAQ:ICFI) has announced an expansion of its share repurchase program. The Board of Directors has approved an additional $100 million, raising the total authorization to $300 million. This decision, made on November 14, 2024, comes as the company had approximately $67 million remaining from its previous authorization.
The repurchase program, which now has no expiration date, allows ICF International to buy back shares on the open market or through privately negotiated transactions, depending on a range of factors including market conditions and corporate capital requirements. The company may engage in repurchases following the guidelines of Rule 10b-18 under the Securities Exchange Act. Furthermore, ICF may implement Rule 10b5-1 trading plans, which would permit a third-party broker to purchase shares under certain regulatory constraints.
The timing and volume of repurchases will be subject to price, market conditions, and other business considerations. The company has stated that the repurchase program could be modified, paused, or terminated at any time.
ICF International emphasizes that the share repurchase program does not necessarily mean that any shares will be bought back and does not commit the company to repurchase a specific number of shares. The program's execution will depend on various factors, including market conditions and potential alternative investment opportunities.
In other recent news, ICF International Inc. reported solid Q3 growth during its earnings call, highlighting a 6% year-on-year increase in revenue from continuing operations, which rose to 10% after considering pass-throughs. The company also raised its full-year EPS guidance by $0.35, now ranging from $6.05 to $6.15. ICF's CEO, John Wasson, announced robust revenue growth of 15.3% in sectors such as energy, environment, infrastructure, and disaster recovery, and a record new business pipeline valued at $10.6 billion.
The company's recent developments include contract wins in public health and infrastructure, particularly related to the Infrastructure Investment and Jobs Act and Inflation Reduction Act. However, ICF adjusted its full-year gross revenue guidance downward due to pass-through reductions.
On the financial front, ICF's CFO, Barry Broadus, reported a third-quarter revenue of $517 million, a 3.1% increase from the previous year. The company's adjusted EBITDA grew to $58.5 million, and net income rose to $32.7 million, largely due to operational improvements and a favorable tax rate. ICF's debt was reduced to $419.1 million, with an adjusted net leverage ratio of 1.85x, and a quarterly cash dividend of $0.14 per share was announced.
InvestingPro Insights
ICF International's decision to expand its share repurchase program aligns with several key financial indicators. According to InvestingPro data, the company's market capitalization stands at $2.54 billion, with a P/E ratio of 23.56. This valuation comes as ICF has demonstrated solid financial performance, with revenue reaching $2 billion in the last twelve months as of Q3 2024, showing a growth of 2.11%.
InvestingPro Tips highlight that ICF is trading at a low P/E ratio relative to its near-term earnings growth, with a PEG ratio of 0.43, suggesting potential undervaluation. This could explain the company's confidence in expanding its buyback program. Additionally, the stock has fared poorly over the last month, with a 20.12% decline, and is trading near its 52-week low. These factors may have influenced the decision to increase share repurchases, as management might view the current stock price as attractive.
The company's profitability is also noteworthy, with InvestingPro Tips indicating that ICF has been profitable over the last twelve months and analysts predict continued profitability this year. This financial health supports the expanded repurchase program.
For investors seeking more comprehensive analysis, InvestingPro offers 5 additional tips for ICF International, providing deeper insights into the company's financial position and market performance.
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