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1. Company Snapshot

1.a. Company Description

Exponent, Inc., together with its subsidiaries, operates as a science and engineering consulting company worldwide.It operates in two segments, Engineering and Other Scientific, and Environmental and Health.The Engineering and Other Scientific segment provides services in the areas of biomechanics, biomedical engineering and sciences, buildings and structures, civil engineering, construction consulting, data sciences, electrical engineering and computer science, human factors, materials and corrosion engineering, mechanical engineering, polymer science and materials chemistry, thermal sciences, and vehicle engineering.


The Environmental and Health segment offers services in the areas of chemical regulation and food safety, ecological and biological sciences, environmental and earth sciences, and health sciences.The company offers approximately 90 technical disciplines to solve pressing and complicated challenges facing stakeholders.It serves clients in chemical, construction, consumer products, energy, food, beverage and nutrition, government, life sciences, insurance, manufacturing, technology, industrial equipment, transportation, and other sectors of the economy.


The company was formerly known as The Failure Group, Inc.and changed its name to Exponent, Inc.in 1998.


Exponent, Inc.was founded in 1967 and is headquartered in Menlo Park, California.

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1.b. Last Insights on EXPO

Exponent, Inc.'s recent performance was positively driven by its Q3 earnings beat, with quarterly earnings of $0.55 per share, surpassing the Zacks Consensus Estimate of $0.5 per share. The company reported strong financial results for Q3 2025, ended October 3, 2025. Additionally, Sequoia Financial Advisors LLC acquired a new stake in Exponent, and State of New Jersey Common Pension Fund D increased its stake by 6.6%. The company's Board of Directors declared a quarterly cash dividend of $0.30 per share and increased the stock repurchase authorization by $100 million.

1.c. Company Highlights

2. Exponent's Q3 2025 Earnings: Strong Growth and Optimistic Outlook

Exponent, Inc. reported a robust third quarter in 2025, with total revenues increasing 8% to $147.1 million and net revenues before reimbursements rising 10% to $137.1 million. Net income grew to $28 million, or $0.55 per diluted share, surpassing estimates of $0.50. EBITDA increased 9% to $38.8 million, with a margin of 28.3% of net revenues. The company's engineering and other scientific segment represented 84% of net revenues, up 10%, while the environmental and health segment, representing 16% of net revenues, increased 9%. The strong financial performance was driven by a diversified portfolio and increasing demand for dispute-related work.

Publication Date: Nov -03

📋 Highlights
  • Net Revenue Growth:: Net revenues before reimbursements rose 10% to $137.1 million in Q3 2025.
  • EBITDA Margin Expansion:: EBITDA reached $38.8 million (28.3% of net revenues), up 9% year-over-year.
  • Stock Buyback Expansion:: $100 million increase in repurchase program, adding to $21.6 million remaining.
  • Reactive Work Surge:: 18% growth in dispute-related work, driving Q3 revenue gains in automotive, medical devices, and consumer products.
  • Headcount Normalization:: 5-6% FTE growth in 2025, with hiring expected to stabilize at 3-3.5% in 2026 due to junior consultant mix.

Segment Performance and Growth Drivers

The company's engineering and other scientific segment continues to be the growth driver, with a 10% increase in net revenues. The environmental and health segment also saw a 9% increase, driven by regulatory work in the chemical and medical device sectors. The CEO noted that the company is seeing significant integration of AI into its work, particularly in areas such as product life cycle, and is helping clients navigate the challenges and risks associated with AI implementation.

Outlook and Guidance

Exponent expects revenues before reimbursements to grow in the low to mid-single digits in the fourth quarter of 2025, with EBITDA to be 26% to 27% of revenues before reimbursements. For the full year 2025, the company expects revenue before reimbursements to grow in the low single digits and EBITDA to be 27.4% to 27.65% of revenues before reimbursements. The company also announced a $100 million increase in its stock repurchase program, indicating confidence in its future prospects.

Valuation and Metrics

With a P/E Ratio of 34.52 and an EV/EBITDA of 25.11, Exponent's valuation suggests that the market is pricing in a certain level of growth. The company's ROE of 24.77% and ROIC of 20.23% indicate strong profitability. Analysts estimate next year's revenue growth at 3.7%, which may be a conservative estimate given the company's historical performance and growth drivers. The actual EPS of $0.55 beat estimates, indicating a positive surprise.

3. NewsRoom

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Coldstream Capital Management Inc. Boosts Holdings in Exponent, Inc. $EXPO

Nov -28

Source: defenseworld.net

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Creative Planning Boosts Position in Exponent, Inc. $EXPO

Nov -27

Source: defenseworld.net

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Commonwealth of Pennsylvania Public School Empls Retrmt SYS Purchases 904 Shares of Exponent, Inc. $EXPO

Nov -24

Source: defenseworld.net

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Exponent, Inc. $EXPO Shares Purchased by State of New Jersey Common Pension Fund D

Nov -02

Source: defenseworld.net

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Exponent (EXPO) Q3 Earnings and Revenues Top Estimates

Oct -30

Source: zacks.com

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Exponent, Inc. (EXPO) Q3 2025 Earnings Call Transcript

Oct -30

Source: seekingalpha.com

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Exponent Reports Third Quarter of Fiscal Year 2025 Financial Results

Oct -30

Source: globenewswire.com

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Exponent Declares Regular Quarterly Dividend for Q4 2025 and Increases Stock Repurchase Authorization by $100 Million

Oct -30

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.55%)

6. Segments

Engineering and Other Scientific

Expected Growth: 3.5%

Exponent's 3.5% growth in Engineering and Other Scientific segment is driven by increasing demand for scientific and engineering consulting services, expansion in emerging markets, and strategic acquisitions. Additionally, the company's expertise in areas like product development, failure analysis, and regulatory compliance is in high demand, contributing to its growth.

Environmental and Health

Expected Growth: 3.8%

Exponent, Inc.'s 3.8% growth in Environmental and Health segment is driven by increasing demand for environmental consulting services, growth in health sciences consulting, and expansion of services in emerging markets. Additionally, the company's expertise in sustainability and climate change, as well as its strong reputation in the industry, contribute to its growth.

7. Detailed Products

Exponent Partner Solutions

A suite of products and services designed to help partners build, deploy, and manage digital experiences for their clients

Exponent DXP

A digital experience platform that enables businesses to create, manage, and optimize digital experiences across multiple channels

Exponent CMS

A content management system that enables businesses to create, manage, and deliver content across multiple channels

Exponent Commerce

An e-commerce platform that enables businesses to create, manage, and optimize online stores and marketplaces

Exponent Analytics

A data analytics platform that enables businesses to collect, analyze, and visualize data to inform business decisions

Exponent AI

An artificial intelligence platform that enables businesses to build, deploy, and manage AI models and applications

8. Exponent, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Exponent, Inc. operates in a niche market, providing data analytics and software solutions, which reduces the threat of substitutes. However, the company's reliance on cloud-based infrastructure and open-source technologies makes it vulnerable to substitutes.

Bargaining Power Of Customers

Exponent, Inc.'s customers are primarily large enterprises and government agencies, which have limited bargaining power due to the company's specialized offerings and high switching costs.

Bargaining Power Of Suppliers

Exponent, Inc. has a diversified supplier base, and its reliance on open-source technologies reduces its dependence on any single supplier, thereby limiting the bargaining power of suppliers.

Threat Of New Entrants

The data analytics and software solutions market has high barriers to entry, including significant capital expenditures and expertise requirements, which limits the threat of new entrants.

Intensity Of Rivalry

The data analytics and software solutions market is highly competitive, with several established players, including large technology companies, which increases 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 7.35%
Debt Cost 3.95%
Equity Weight 92.65%
Equity Cost 7.17%
WACC 6.93%
Leverage 7.94%

11. Quality Control: Exponent, Inc. passed 7 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
Booz Allen Hamilton

A-Score: 5.4/10

Value: 5.2

Growth: 7.7

Quality: 7.4

Yield: 5.0

Momentum: 0.5

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
Exponent

A-Score: 4.5/10

Value: 1.0

Growth: 5.7

Quality: 8.2

Yield: 3.0

Momentum: 1.0

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
ICF International

A-Score: 4.3/10

Value: 6.6

Growth: 6.6

Quality: 5.4

Yield: 1.0

Momentum: 0.0

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
FTI Consulting

A-Score: 4.2/10

Value: 3.4

Growth: 6.6

Quality: 6.0

Yield: 0.0

Momentum: 0.5

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
CBIZ

A-Score: 3.6/10

Value: 3.2

Growth: 5.2

Quality: 5.3

Yield: 0.0

Momentum: 2.5

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
TransUnion

A-Score: 3.6/10

Value: 2.6

Growth: 5.8

Quality: 5.7

Yield: 0.0

Momentum: 2.5

Volatility: 5.0

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

73.21$

Current Price

73.21$

Potential

-0.00%

Expected Cash-Flows