Montrose Environmental Group (MEG) AI Stock Analysis

• Market Cap: $913.21M
• Dividend Yield: N/A
• Average Volume (3M): 428.07K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.47
• Revenue Growth: 17.78%
• EPS Growth: 2.57%
• Country: US
• Employees: 3,400
• Sector: Industrials
• Sector Strength: 72
• Industry: Waste Management
• EPS (TTM): 0.42
• Shares Outstanding: 35,286,490
• 10 Day Avg. Volume: 389,021
• 30 Day Avg. Volume: 428,069
• PEG Ratio: -0.24
• Price to Book (P/B): 1.14
• Price to Sales (P/S): 0.88
• P/FCF Ratio: 679.91
• Enterprise Value/Market Cap: 1.43
• Enterprise Value/Revenue: 1.67
• Enterprise Value/Gross Profit: 4.06
• Enterprise Value/Ebitda: 27.12
• 1Y Price Target: $34.75
• Price Target Upside: 34.27% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 62 Neutral
• Price Target: $27.00 ▲(4.33% Upside)

Montrose Environmental Group's overall score is driven by strong earnings call results, showcasing record revenue and EBITDA growth, and improved cash flow. However, the stock's technical indicators are bearish, and the valuation reflects ongoing profitability challenges. The company's financial performance shows potential but is hindered by negative net income and leverage concerns.

Positive Factors

Revenue Growth

The strong revenue growth indicates robust market demand and effective business strategies, contributing to long-term financial stability and competitive positioning.

Cash Flow Improvement

Improved cash flow enhances financial flexibility, allowing for strategic investments and debt reduction, supporting sustainable growth.

Balance Sheet Simplification

Simplifying the balance sheet and reducing leverage strengthens financial health, reducing risk and improving the company's ability to navigate economic cycles.

Negative Factors

Profitability Challenges

Ongoing profitability issues could limit reinvestment capabilities and affect long-term growth, necessitating improved cost management and operational efficiency.

Regulatory Uncertainty

Regulatory changes can impact operational strategies and compliance costs, posing risks to long-term business operations and profitability.

Increased Shares Dilution

Share dilution can dilute earnings per share, affecting shareholder value and potentially leading to investor dissatisfaction over the long term.

Montrose Environmental Group Business Overview & Revenue Model

Company Description

Montrose Environmental Group (MEG) is a leading environmental services company that specializes in providing comprehensive solutions for air, water, and soil quality management. Operating across various sectors including industrial, commercial, and governmental entities, MEG offers a range of core services such as environmental consulting, remediation, compliance testing, and monitoring. The company is committed to helping clients navigate the complexities of environmental regulations while promoting sustainability and operational efficiency.

How the Company Makes Money

Montrose Environmental Group generates revenue primarily through its diversified service offerings. Key revenue streams include consulting fees for environmental assessments, contracts for remediation projects, and ongoing monitoring services for compliance with environmental regulations. The company also earns income through partnerships with government agencies and private sector clients, which often result in multi-year contracts. Additionally, MEG leverages its expertise to provide specialized training and educational services, contributing further to its earnings. Overall, the company's ability to adapt to regulatory changes and invest in technological advancements plays a significant role in its financial success.

Montrose Environmental Group Financial Statement Overview

Summary

Montrose Environmental Group shows solid revenue growth and improving cash flow, indicating future potential. However, challenges with profitability and leverage, as reflected in negative net income and increasing debt levels, require attention.

Income Statement

Montrose Environmental Group shows a positive revenue growth trend with an 8.5% increase in TTM, indicating strong market demand. However, the company struggles with profitability, as evidenced by negative net profit and EBIT margins. The gross profit margin is healthy at 41.2%, but the net profit margin remains negative at -5.1%, reflecting ongoing challenges in cost management and operational efficiency.

Balance Sheet

The company's debt-to-equity ratio of 0.66 in TTM suggests moderate leverage, which is manageable but has increased over time. The return on equity is negative, indicating that the company is not generating sufficient returns on shareholders' investments. The equity ratio is stable, showing that a significant portion of assets is financed by equity.

Cash Flow

Montrose Environmental Group demonstrates strong cash flow improvements, with a significant 104.6% growth in free cash flow in TTM. The operating cash flow to net income ratio is 0.48, indicating decent cash generation relative to net income. The free cash flow to net income ratio is high at 0.87, showing effective cash conversion despite net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	780.12M	696.39M	624.21M	544.42M	546.41M	328.24M
Gross Profit	321.36M	278.20M	240.31M	192.53M	177.38M	112.75M
EBITDA	48.16M	25.88M	31.93M	32.44M	36.91M	-7.41M
Net Income	-39.79M	-62.31M	-30.86M	-31.82M	-25.32M	-57.95M
Balance Sheet
Total Assets	998.08M	990.35M	816.79M	791.91M	833.09M	602.73M
Cash, Cash Equivalents and Short-Term Investments	10.48M	12.94M	23.24M	89.83M	146.25M	34.39M
Total Debt	331.42M	281.00M	210.34M	202.12M	205.77M	175.90M
Total Liabilities	494.02M	544.09M	342.61M	325.80M	363.67M	312.65M
Stockholders Equity	504.06M	539.19M	474.18M	466.12M	469.43M	290.07M
Cash Flow
Free Cash Flow	61.47M	902.00K	23.09M	10.65M	30.00M	-5.93M
Operating Cash Flow	70.76M	22.23M	56.02M	20.65M	37.58M	1.85M
Investing Cash Flow	-58.04M	-138.04M	-101.62M	-38.69M	-71.64M	-179.74M
Financing Cash Flow	-18.09M	106.00M	-20.11M	-38.76M	146.10M	205.90M

Montrose Environmental Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 25.88
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MEG, the sentiment is Negative. The current price of 25.88 is below the 20-day moving average (MA) of 27.90, below the 50-day MA of 28.64, and above the 200-day MA of 21.91, indicating a neutral trend. The MACD of -0.48 indicates Positive momentum. The RSI at 38.96 is Neutral, neither overbought nor oversold. The STOCH value of 9.20 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MEG.

Montrose Environmental Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	―	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
MEG	―	$913.21M	―	-7.61%	―	17.78%	2.57%
PESI	―	$252.86M	―	-34.16%	―	-16.87%	-124.96%
NVRI	―	$984.71M	―	-35.66%	―	-0.83%	-61.90%
QRHC	―	$31.48M	-1.25	-46.57%	―	-5.20%	-275.34%
LNZA	―	$60.78M	-0.39	-490.45%	―	-40.11%	-36.69%

Montrose Environmental Group Corporate Events

Montrose Environmental Group Reports Strong Q2 Earnings

Montrose Environmental Group Inc’s recent earnings call conveyed a positive sentiment, underscoring the company’s impressive revenue and EBITDA growth. The call highlighted strong organic growth, improved margins, and successful financial strategies, despite some regulatory uncertainties and a temporary pause in acquisitions. The company’s outlook remains optimistic with increased guidance for 2025.

Montrose Environmental Group Reports Record Growth in 2025

Montrose Environmental Group, Inc., a prominent player in the environmental solutions sector, is dedicated to enhancing environmental stewardship through innovative solutions across air, water, and soil management. The company operates globally, providing comprehensive services in environmental measurement, analysis, and remediation.

Montrose Environmental Group Reports Record-Breaking Q2 2025

Montrose Environmental Group reported a record-breaking second quarter and first half of 2025, with significant revenue growth and improved financial metrics compared to the previous year. The company increased its full-year 2025 financial guidance, driven by strong organic growth, contributions from acquisitions, and improved margins, while also simplifying its capital structure by redeeming Series A-2 Preferred Stock earlier than planned.

The most recent analyst rating on (MEG) stock is a Hold with a $30.00 price target. To see the full list of analyst forecasts on Montrose Environmental Group stock, see the MEG Stock Forecast page.