Tutor Perini’s second quarter was marked by strong execution on newer, higher-margin projects, resulting in performance that exceeded Wall Street’s revenue and profit expectations. Management attributed the outperformance to increased activity in its Civil and Building segments, both of which benefited from robust project execution and favorable adjustments. CEO Gary Smalley highlighted the impact of accelerated project ramp-ups and fewer write-downs, stating, “The ramp-up of some of these projects was a little quicker than we anticipated.” Additionally, progress in resolving disputed items contributed to record operating cash flow, reinforcing the company’s ability to capitalize on its growing backlog.
Is now the time to buy TPC? Find out in our full research report (it’s free).
Tutor Perini (TPC) Q2 CY2025 Highlights:
- Revenue: $1.37 billion vs analyst estimates of $1.27 billion (21.8% year-on-year growth, 8.5% beat)
- Adjusted EPS: $0.38 vs analyst estimates of $0.34 (12.4% beat)
- Adjusted EBITDA: $144.6 million vs analyst estimates of $68.19 million (10.5% margin, significant beat)
- Adjusted EPS guidance for the full year is $3.80 at the midpoint, beating analyst estimates by 110%
- Operating Margin: 5.6%, up from 3.6% in the same quarter last year
- Backlog: $21.1 billion at quarter end
- Market Capitalization: $3.1 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Tutor Perini’s Q2 Earnings Call
- Michael Stephan Dudas (Vertical Research): Asked about major project closeouts and win rates for new business. CEO Gary Smalley explained that revenue growth will be driven more by new project ramp-ups than by closeouts, while Executive Chairman Ron Tutor added that only two significant jobs are winding down, both offset by new awards.
- Michael Stephan Dudas (Vertical Research): Inquired about drivers behind first half outperformance versus plan. Smalley cited faster project ramp-ups, fewer write-downs, and better-than-expected CIE reductions, emphasizing that contingency reserves were used less than anticipated.
- Michael Stephan Dudas (Vertical Research): Questioned capital allocation plans given strong cash flow. Smalley stated the board remains fiscally conservative, preferring to accumulate more cash before considering dividends or buybacks, given ongoing business growth and working capital needs.
- Adam Robert Thalhimer (Thompson, Davis): Sought clarity on project funnel and bidding selectivity. Smalley confirmed the company is more selective, targeting projects with higher margins and less competition, particularly in L.A., the Indo-Pacific, and Midwest regions.
- Steven Michael Fisher (UBS): Asked about Civil segment margin assumptions and tariff exposure. Smalley noted Civil margins have increased to a 12%–15% range and explained that proactive material purchasing and contract structures mitigate current and future tariff risks.
Catalysts in Upcoming Quarters
Our analysts will be watching (1) the progression of new large-scale infrastructure projects from ramp-up into full execution, (2) the ability of Tutor Perini to maintain strong Civil segment margins despite external cost pressures, and (3) continued reductions in disputed billings and improvement in cash flow. Updates on project awards and the Specialty Contractors segment’s return to profitability will also be important indicators of sustained momentum.
Tutor Perini currently trades at $59.48, up from $47.26 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).
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