ICF International, Inc. (ICFI) Stock Analysis
ICF International, Inc. (ICFI) Stock Analysis
Overall Grade: F (Concerning)
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ICF International, Inc. faces challenges in financial performance that warrant careful analysis.
Key Metrics:
| Metric | Value | Context |
|---|---|---|
| ROIC | 7.3% | Below expectations |
| FCF Margin | 6.4% | Healthy cash flow |
| Debt/Equity | 0.4x | Conservative leverage |
Investment Thesis: Financial metrics indicate concerning business quality with areas requiring attention.
What is ICF International, Inc.'s Profitability and ROIC?
ICF International, Inc.'s return on invested capital of 7.3% is below the typical cost of capital. Gross margin of 37.2% with operating margin at 7.8% reflects the company's moderate market position.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 7.3% | Warning | Below cost of capital |
| Return on Equity (ROE) | 9.2% | Adequate | Moderate equity returns |
| Gross Margin | 37.2% | Good | Competitive pricing environment |
| Operating Margin | 7.8% | Adequate | Moderate operational efficiency |
How Strong is ICF International, Inc.'s Cash Flow Quality?
ICF International, Inc. generated $120.2M in free cash flow over the trailing twelve months, representing a 6.4% margin. Cash earnings quality is strong, with operating cash flow exceeding net income by 1.5x.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Free Cash Flow Margin | 6.4% | Adequate | Healthy cash generation |
| Free Cash Flow (TTM) | $120.2M | Good | Positive cash generation |
| OCF/Net Income | 1.5x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
What is ICF International, Inc.'s Financial Health?
ICF International, Inc.'s debt-to-equity ratio of 0.4x indicates conservative leverage.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Debt to Equity | 0.4x | Good | Conservative capital structure |
| Net Cash Position | $-345.0M | Adequate | Net debt position |
Is ICF International, Inc. Stock Overvalued or Undervalued?
ICF International, Inc. trades at a P/E of 17.2x, representing a premium to the sector median of N/A. Free cash flow yield of 7.7% offers attractive cash returns.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| P/E Ratio | 17.2x | Adequate | Reasonable valuation |
| EV/Sales | 1.1x | Excellent | Attractive revenue multiple |
| FCF Yield | 7.7% | Good | Attractive cash return |
| Dividend Yield | 0.7% | Adequate | Growth focus over income |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 7.3% | Bottom 50% | 0.9x below |
| Free Cash Flow Margin | 6.4% | Top 50% | 1.2x above |
| Gross Margin | 37.2% | Top 50% | 1.1x above |
| Operating Margin | 7.8% | Bottom 50% | 1.0x below |
| Return on Equity (ROE) | 9.2% | Top 50% | 1.0x above |
| P/E Ratio | 17.2x | N/A | - |
Rating Thresholds
Return on Invested Capital (ROIC)
Measures how efficiently a company uses its debt and equity capital to generate profits. ROIC above 15% typically indicates a competitive moat.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 20% | Exceptional capital efficiency, strong competitive moat |
| Good | 12% - 20% | Above-average returns, sustainable competitive position |
| Adequate | 8% - 12% | Around cost of capital, moderate competitive position |
| Warning | 4% - 8% | Below cost of capital, value may be eroding |
| Red flag | < 4% | Significant capital destruction, fundamental issues |
Current: 7.3% (Warning - Bottom 50% of sector (median: 8.0%))
Free Cash Flow Margin
The percentage of revenue converted to free cash flow. Higher margins indicate stronger cash generation and business quality.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 20% | Strong cash generation, high-quality business |
| Good | 10% - 20% | Healthy cash conversion |
| Adequate | 5% - 10% | Moderate cash generation |
| Warning | 0% - 5% | Thin cash margins, capital intensive |
| Red flag | < 0% | Cash burn, potential liquidity concerns |
Current: 6.4% (Adequate - Top 50% of sector (median: 5.4%))
Gross Margin
Revenue minus cost of goods sold as a percentage. Higher gross margins indicate pricing power and competitive advantage.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 50% | Strong pricing power and competitive moat |
| Good | 30% - 50% | Healthy margins, differentiated product |
| Adequate | 20% - 30% | Moderate margins, competitive industry |
| Warning | 10% - 20% | Thin margins, commodity-like business |
| Red flag | < 10% | Very thin margins, structural challenges |
Current: 37.2% (Good - Top 50% of sector (median: 33.4%))
Debt to Equity Ratio
Total debt divided by shareholders' equity. Lower ratios indicate more conservative financing and reduced financial risk.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | < 0.3x | Conservative leverage, strong balance sheet |
| Good | 0.3x - 0.7x | Moderate leverage, healthy financial position |
| Adequate | 0.7x - 1.5x | Elevated leverage, monitor closely |
| Warning | 1.5x - 3.0x | High leverage, increased financial risk |
| Red flag | > 3.0x | Excessive leverage, potential distress risk |
Current: 39.0% (Good)
P/E Ratio (Price-to-Earnings)
Stock price divided by earnings per share. Lower P/E may indicate undervaluation, while higher P/E suggests growth expectations.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | < 15x | Attractively valued, potential opportunity |
| Good | 15x - 25x | Fair value for quality company |
| Adequate | 25x - 35x | Growth premium, justify with earnings growth |
| Warning | 35x - 50x | High expectations priced in |
| Red flag | > 50x or negative | Speculative valuation or losses |
Current: 17.2x (Adequate)
Free Cash Flow Yield
Free cash flow per share divided by stock price. Higher FCF yield indicates better cash return relative to valuation.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 8% | High cash return, potential value opportunity |
| Good | 5% - 8% | Solid cash yield |
| Adequate | 3% - 5% | Moderate cash return |
| Warning | 1% - 3% | Low cash yield, growth expectations |
| Red flag | < 1% | Minimal cash return to shareholders |
Current: 7.7% (Good)
Frequently Asked Questions
Q: What is ICF International, Inc.'s Return on Invested Capital (ROIC)?
ICF International, Inc. (ICFI) has a trailing twelve-month Return on Invested Capital (ROIC) of 7.3%. This compares below the sector median of 8.0%. An ROIC below 8% suggests the company may be destroying shareholder value.
Q: What is ICF International, Inc.'s Free Cash Flow Margin?
ICF International, Inc. (ICFI) has a free cash flow margin of 6.4%, generating $120.2 million in free cash flow over the trailing twelve months. A FCF margin between 5-10% is typical for capital-intensive businesses.
Q: Is ICF International, Inc. stock overvalued or undervalued?
ICF International, Inc. (ICFI) trades at a P/E ratio of 17.2x, which is above the sector median of N/A. The EV/Sales multiple is 1.1x. Free cash flow yield is 7.7%, which represents an attractive cash return to investors.
Q: Does ICF International, Inc. pay a dividend?
ICF International, Inc. (ICFI) currently pays a dividend yield of 0.7%. Including share buybacks, the total shareholder yield is 4.2%. The relatively low yield suggests the company prioritizes growth reinvestment over income distribution.
Q: What is ICF International, Inc.'s revenue and earnings growth?
ICF International, Inc. (ICFI) declined revenue by 7.3% year-over-year. Earnings per share decreased by 15.1% compared to the prior year. Revenue decline may indicate market challenges or industry headwinds.
Q: Is ICF International, Inc. buying back stock?
ICF International, Inc. (ICFI) repurchased $55.3 million of stock over the trailing twelve months. This represents a buyback yield of 3.5%.
Q: How does ICF International, Inc. compare to competitors in Industrials?
Compared to other companies in Industrials, ICF International, Inc. (ICFI) shows: ROIC of 7.3% is below the sector median of 8.0% (Bottom 47%). FCF margin of 6.4% exceeds the sector median of 5.4% (Top 46% of sector). Gross margin at 37.2% is 3.8 percentage points higher than sector peers. These rankings are based on MetricDuck's analysis of all Industrials companies with available SEC filings.
Q: What warning signs should I watch for with ICF International, Inc.?
Investors in ICF International, Inc. (ICFI) should monitor these potential warning signs: 1) ROIC has been declining, potentially signaling deteriorating competitive position. Regular monitoring of SEC filings and quarterly trends is recommended.
Data Source: Data sourced from 10-Q filed 2025-10-30. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
This analysis is for informational purposes only and does not constitute investment advice.