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On Tuesday, Stifel analysts maintained their Buy rating and $102.00 price target for Limbach Holdings (NASDAQ:LMB), following the company’s fourth-quarter earnings report. According to InvestingPro data, the company has demonstrated strong profitability with a healthy 25.9% gross margin over the last twelve months. Limbach’s fourth-quarter revenue came in at $144 million, which was below the $149 million market consensus. However, the company’s adjusted EBITDA surpassed expectations at $21 million, compared to the $18 million consensus.
Limbach’s Operational Development and Renewal (ODR) segment saw a 21% year-over-year increase in revenue, while the General Construction Revenue (GCR) segment experienced a 25% decline. This shift reflects the company’s ongoing strategic transformation, with the ODR segment now representing 66% of the fourth-quarter revenue. The adjusted EBITDA margin for the quarter was 14.5%, a significant increase of 570 basis points from the previous year and well above the expected 12.0%. InvestingPro analysis reveals the company maintains strong financial health with a current ratio of 1.57 and holds more cash than debt on its balance sheet.
The company’s total backlog, which indicates future revenue potential, grew by 9% year-over-year. This marks the first year-over-year increase in over two years. The growth was mainly attributed to a 53% increase in the ODR backlog, although the GCR backlog declined by 25%.
Looking ahead, Limbach provided initial guidance for the year 2025 that exceeded market expectations. The company forecasts a midpoint revenue of $620 million, compared to the $597 million market consensus, and an adjusted EBITDA midpoint of $80 million, higher than the $73 million consensus. This guidance suggests an EBITDA margin of 12.9% for 2025, an improvement from the 12.3% margin in 2024.
In other recent news, Limbach Holdings Inc. reported its fourth-quarter 2024 earnings, demonstrating a notable earnings per share (EPS) beat despite a slight revenue miss. The company’s EPS reached $1.15, significantly surpassing the forecasted $0.79, while revenue came in at $143.65 million, falling short of the expected $149.37 million. For the full year, Limbach achieved a total revenue of $518.8 million, marking a 0.5% increase from the previous year, with an EPS of $2.57, up 46% from 2023. The company continues to focus on its Owner Direct Revenue (ODR) segment, which grew by 31.9% and now comprises 66.6% of total revenue.
Limbach Holdings has also been active in strategic acquisitions, completing two in 2024 that are expected to add approximately $6 million to the adjusted EBITDA in 2025. The company anticipates organic top-line revenue growth between 10% and 15% for 2025, with total revenue projected to range from $610 million to $630 million. Limbach’s strategic focus remains on expanding the ODR segment to constitute 70% to 80% of total revenue. Additionally, the company is targeting adjusted EBITDA for 2025 to be between $78 million and $82 million.
In terms of analyst actions, Lake Street Capital and Roth Capital are among the firms that have shown interest in Limbach’s strategic direction and financial performance. Limbach’s recent performance and strategic initiatives reflect its commitment to sustainable growth and its focus on high-margin segments.
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