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1. Company Snapshot

1.a. Company Description

CRA International, Inc., together with its subsidiaries, provides economic, financial, and management consulting services in the United States, the United Kingdom, and internationally.It advises clients on economic and financial matters pertaining to litigation and regulatory proceedings; and guides corporations through business strategy and performance-related issues.The company also offers consulting services, including research and analysis, expert testimony, and support in litigation and regulatory proceedings in the areas of finance, accounting, economics, insurance, and forensic accounting and investigations to corporate clients and attorneys.


In addition, it offers management consulting services comprising strategy development, performance improvement, corporate strategy and portfolio analysis, estimation of market demand, new product pricing strategies, valuation of intellectual property and other assets, assessment of competitors' actions, and analysis of new sources of supply.The company serves various industries, including communications and media; consumer, health, and wellness products; energy; entertainment and leisure; financial services; healthcare; life sciences; manufacturing and industries; natural resources; retail and distribution; technology; and transportation.CRA International, Inc.


was incorporated in 1965 and is headquartered in Boston, Massachusetts.

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1.b. Last Insights on CRAI

CRA International's recent performance faced challenges due to increased competition in the business services sector. Despite strong Q3 results with earnings and revenues beating estimates, concerns linger. The company has been expanding its practices, including Risk, Investigations & Analytics, Forensic Services, and Antitrust & Competition Economics, through strategic hires. CRAI's liquidity pressures and sector competition may impact its short-term prospects. Zacks upgraded CRAI to a Buy rating, citing growing optimism about its earnings prospects (Source: Zacks).

1.c. Company Highlights

2. CRA's Q3 Fiscal 2025 Earnings: A Strong Performance

CRA's President and CEO, Paul Maleh, announced strong revenue growth of 10.8% year-over-year to $185.9 million in the third quarter of fiscal 2025, with EPS coming in at $2.06, beating estimates of $1.8. The company's non-GAAP EBITDA margin is expected to be in the range of 12.6% to 13.0% for fiscal 2025. The revenue growth was driven by low double-digit rate increases, primarily due to rate card increases. CRA raised its revenue guidance for fiscal 2025, expecting revenue in the range of $740 million to $748 million.

Publication Date: Nov -19

📋 Highlights
  • Revenue Growth:: 10.8% YoY to $185.9M in Q3 FY2025, highest three-quarter revenue in company history.
  • Practice Expansion:: 7/11 practices grew YoY, with double-digit gains in Antitrust, Energy, Finance, and Intellectual Property.
  • Guidance上调:: Full-year revenue raised to $740M–$748M, with non-GAAP EBITDA margin projected at 12.6%–13.0%.
  • Dividend Increase:: 16% rise in quarterly dividend to $0.57/share, reflecting capital return confidence.
  • Headcount Shift:: 1% YoY decline in total consultants (968), but added nearly 20 new Vice Presidents via lateral hires.

Revenue Growth Across Practices

Seven out of 11 practices showed year-over-year growth, including double-digit increases in Antitrust & Competition Economics, Energy, Finance, and Intellectual Property practices. The Antitrust & Competition Economics practice established another new high for quarterly revenue, advising UnitedHealth Group on its $3.3 billion acquisition of Amedisys and providing economic analysis to Microsoft during an EU investigation. Other notable practices include Energy, which supported a major California electric utility in developing its integrated resource plan.

Valuation Metrics

With a P/E Ratio of 19.89 and an EV/EBITDA of 11.43, CRA's valuation appears reasonable considering its strong revenue growth and profitability. The company's ROE of 27.01% and ROIC of 14.77% indicate a high level of profitability. The dividend yield of 1.14% is a nice bonus for shareholders, and the recent 16% increase in the quarterly cash dividend demonstrates the company's confidence in its business and commitment to returning capital to shareholders.

Growth Prospects

Paul Maleh attributes the 30% plus year-over-year growth in Europe to the consistency of strong enforcement and the top-notch quality of their Antitrust & Competition Economics practice. The company assumes bill rates in the 2% to 4% range, with the possibility of higher increases if the value delivered to clients remains a priority. Analysts estimate next year's revenue growth at 3.7%, which is relatively conservative considering CRA's historical performance and growth prospects.

Client Verticals and Regulatory Scrutiny

The Energy sector has continued to show strong demand, and the Pharmaceutical Life Sciences space is starting to see upward momentum. Paul Maleh notes that the Antitrust & Competition Economics practice is delivering record quarters, despite potential changes in the regulatory environment. He's optimistic about the sustainability of demand for IP services, citing the complexity of matters and the go-to provider status of CRA's IP practice.

3. NewsRoom

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CRA International, Inc. (CRAI) Presents at UBS Global Technology and AI Conference 2025 Transcript

Dec -01

Source: seekingalpha.com

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Bank of New York Mellon Corp Sells 5,487 Shares of Charles River Associates $CRAI

Nov -21

Source: defenseworld.net

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CRAI Shares Increase 2.8% Since Its Q3 Earnings Release

Nov -06

Source: zacks.com

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Charles River Associates (CRA) Strengthens Its Forensic Services Practice

Nov -06

Source: businesswire.com

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Charles River Associates (CRA) Strengthens Its Antitrust & Competition Economics Practice

Nov -04

Source: businesswire.com

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Head-To-Head Survey: Charles River Associates (NASDAQ:CRAI) and Information Services Group (NASDAQ:III)

Nov -04

Source: defenseworld.net

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CRA International, Inc. (CRAI) Q3 2025 Earnings Call Transcript

Oct -30

Source: seekingalpha.com

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CRA International (CRAI) Q3 Earnings and Revenues Beat Estimates

Oct -30

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.68%)

6. Segments

Time-and-materials

Expected Growth: 3.5%

CRA International's 3.5% time-and-materials growth driven by increasing demand for expert services in litigation, regulatory, and financial consulting. Strong client relationships, expansion into new markets, and strategic acquisitions also contribute to growth. Additionally, the company's ability to adapt to changing market conditions and provide innovative solutions to clients has enabled it to maintain a steady growth trajectory.

Fixed-price

Expected Growth: 4.5%

CRA International's 4.5% fixed-price growth is driven by increasing demand for expert services in litigation, regulatory, and financial consulting. Strong brand reputation, expansion into new markets, and strategic acquisitions also contribute to growth. Additionally, the company's ability to adapt to changing market conditions and its focus on innovation and technology enable it to capitalize on emerging opportunities.

7. Detailed Products

Antitrust & Competition Economics

CRA International provides economic analysis and expert testimony in antitrust and competition matters, including merger reviews, monopolization cases, and cartel investigations.

Damages & Disputes

CRA International provides economic analysis and expert testimony in disputes related to intellectual property, breach of contract, and other commercial disputes.

Energy & Environment

CRA International provides economic analysis and expert testimony on energy and environmental issues, including climate change, energy policy, and environmental regulation.

Financial Economics

CRA International provides economic analysis and expert testimony on financial economics issues, including securities litigation, financial institution regulation, and financial market analysis.

Healthcare

CRA International provides economic analysis and expert testimony on healthcare issues, including healthcare policy, reimbursement, and regulatory issues.

Intellectual Property

CRA International provides economic analysis and expert testimony on intellectual property issues, including patent infringement, copyright infringement, and trade secret misappropriation.

Labor & Employment

CRA International provides economic analysis and expert testimony on labor and employment issues, including employment discrimination, wage and hour disputes, and labor market analysis.

Regulatory Economics

CRA International provides economic analysis and expert testimony on regulatory issues, including rate regulation, cost of capital, and regulatory policy.

Strategy & Operations

CRA International provides strategic and operational consulting services to companies in various industries, including energy, healthcare, and financial services.

8. CRA International, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

CRA International, Inc. operates in a niche market, providing specialized services, which reduces the threat of substitutes. However, the company's services can be substituted with in-house solutions or other consulting firms, posing a moderate threat.

Bargaining Power Of Customers

CRA International, Inc.'s customers are primarily large corporations and government agencies, which have limited bargaining power due to the specialized nature of the company's services.

Bargaining Power Of Suppliers

CRA International, Inc. has a diverse supplier base, and the company's specialized services reduce the bargaining power of suppliers.

Threat Of New Entrants

The specialized nature of CRA International, Inc.'s services and the high barriers to entry, including the need for expertise and reputation, reduce the threat of new entrants.

Intensity Of Rivalry

CRA International, Inc. operates in a competitive market, but the company's specialized services and strong reputation help to differentiate it from competitors, reducing the intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 33.90%
Debt Cost 4.76%
Equity Weight 66.10%
Equity Cost 10.06%
WACC 8.26%
Leverage 51.28%

11. Quality Control: CRA International, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Ennis

A-Score: 6.7/10

Value: 7.2

Growth: 4.1

Quality: 7.2

Yield: 10.0

Momentum: 2.5

Volatility: 9.0

1-Year Total Return ->

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REV Group

A-Score: 5.8/10

Value: 4.1

Growth: 6.2

Quality: 6.3

Yield: 4.0

Momentum: 10.0

Volatility: 4.0

1-Year Total Return ->

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Huron Consulting Group

A-Score: 5.7/10

Value: 3.9

Growth: 7.7

Quality: 7.4

Yield: 0.0

Momentum: 9.5

Volatility: 6.0

1-Year Total Return ->

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CRAI

A-Score: 5.0/10

Value: 3.0

Growth: 6.8

Quality: 5.4

Yield: 2.0

Momentum: 6.0

Volatility: 7.0

1-Year Total Return ->

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Stock-Card
Resources Connection

A-Score: 4.5/10

Value: 8.5

Growth: 0.9

Quality: 3.8

Yield: 9.0

Momentum: 0.5

Volatility: 4.7

1-Year Total Return ->

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Stock-Card
Franklin Covey

A-Score: 4.1/10

Value: 6.3

Growth: 6.9

Quality: 6.9

Yield: 0.0

Momentum: 0.0

Volatility: 4.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

190.34$

Current Price

190.34$

Potential

-0.00%

Expected Cash-Flows