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1. Company Snapshot

1.a. Company Description

Great Lakes Dredge & Dock Corporation provides dredging services in the United States.The company engages in capital dredging that consists of port expansion projects; coastal restoration and land reclamations; trench digging for pipelines, tunnels, and cables; and other dredging related to the construction of breakwaters, jetties, canals, and other marine structures.It is also involved in coastal protection projects that comprises of moving sand from the ocean floor to shoreline locations where erosion threatens shoreline assets; maintenance dredging, which consists of the re-dredging of previously deepened waterways and harbors to remove silt, sand, and other accumulated sediments; land reclamations, channel deepening, and port infrastructure development; and lake and river dredging, inland levee and construction dredging, environmental restoration and habitat improvement, and other marine construction projects.


The company serves federal, state, and local governments; foreign governments; and domestic and foreign private concerns, such as utilities, oil, and other energy companies.It operates a fleet of 18 dredges, 17 material transportation barges, 1 drillboat, and various other support vessels.The company was formerly known as Lydon & Drews Partnership and changed its name to Great Lakes Dredge & Dock Corporation in 1905.


Great Lakes Dredge & Dock Corporation was founded in 1890 and is headquartered in Houston, Texas.

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1.b. Last Insights on GLDD

The recent 3-month performance of Great Lakes Dredge & Dock Corporation was driven by strong Q1 2025 earnings and revenue beat, with a 24.7% EBITDA margin, a 300%+ net income growth in 2024, and a $1B+ high-margin backlog. The company's fleet overhaul and infrastructure boom have lifted Q1 margins, boosting investor appeal with a discounted valuation. Additionally, the stock is trading below its industry peers with a forward 12-month price-to-earnings (P/E) ratio of 12.43X. The company's backlog is dominated by capital and coastal protection projects, positioning GLDD for higher margins, continued profitability, and steady cash flows.

1.c. Company Highlights

2. Great Lakes Dredge & Dock's Q3 2025 Earnings: Strong Performance and Optimistic Outlook

Great Lakes Dredge & Dock reported revenues of $195.2 million, net income of $17.7 million, and adjusted EBITDA of $39.3 million for Q3 2025. The company's gross profit margin improved to 22.4% from 19% in Q3 2024, driven by strong project performance. Earnings per share (EPS) came in at $0.26, beating estimates of $0.17. The company's dredging backlog remains robust at $935 million, with 84% in capital and coastal protection projects.

Publication Date: Nov -18

📋 Highlights
  • Strong Q3 Financial Results:: Revenue reached $195.2M with adjusted EBITDA of $39.3M, while gross profit margin expanded to 22.4% from 19% YoY.
  • Robust Backlog Position:: $935M backlog remains strong, with 84% allocated to capital and coastal protection projects, ensuring sustained revenue visibility.
  • Debt Refinancing Benefits:: Upsized $430M credit facility at lower rates eliminated $100M in second-lien notes, reducing annual interest costs by $6M.
  • Government Shutdown Resilience:: Operations remained uninterrupted during the shutdown, with timely payments and no disruption to project schedules or contract awards.
  • 2026 Growth Catalysts:: Delivery of the Acadia vessel in 2026 and $500M+ in coastal protection projects (50% private-funded) support revenue expansion and margin stability.

Financial Performance

The company's financial performance was driven by high utilization and strong project execution, particularly in complex port deepening and coastal restoration projects. The increase in gross profit margin was a notable highlight, demonstrating the company's ability to execute projects efficiently. As CEO Lasse Petterson noted, "We ended the quarter with revenues of $195.2 million and adjusted EBITDA of $39.3 million," underscoring the company's strong operational performance.

Balance Sheet and Cash Flow

Great Lakes Dredge & Dock ended the quarter with $12.7 million in cash and no debt drawn on its revolver. The company recently upsized its revolving credit facility to $430 million and extended the maturity to October 2030, reducing borrowing rates and interest expense by almost $6 million per year. This move demonstrates the company's proactive approach to managing its balance sheet and reducing costs.

Valuation and Outlook

With a P/E Ratio of 9.96, P/B Ratio of 1.6, and EV/EBITDA of 8.25, the company's valuation appears reasonable. Analysts estimate revenue growth of 5.3% for next year, and the company's strong backlog and optimistic outlook suggest that this growth rate is achievable. The company's ROE of 16.84% and ROIC of 11.0% also indicate a strong return on investment. As the company continues to execute on its projects and deliver strong financial performance, its valuation may be supported by its improving fundamentals.

Operational Highlights

The company's operational performance was also notable, with a robust backlog and a diversified client portfolio. The coastal protection market is expected to remain active, with beach restoration and coastal protection projects coming out to bid. The company's modernized fleet and competent teams are well-positioned to capitalize on these opportunities, driving future growth and profitability.

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (12.26%)

6. Segments

Coastal Protection

Expected Growth: 12%

Coastal Protection from Great Lakes Dredge & Dock Corporation is driven by increasing government investments in coastal resilience and infrastructure, rising sea levels, and growing demand for beach nourishment and coastal restoration services, resulting in 12% growth.

Maintenance

Expected Growth: 11%

Great Lakes Dredge & Dock Corporation's 11% growth in Maintenance is driven by increasing demand for dredging services from government agencies and private companies, expansion into new markets, and a growing focus on environmental remediation and coastal protection projects.

Capital - United States

Expected Growth: 14%

Great Lakes Dredge & Dock Corporation's 14% growth in the United States is driven by increasing infrastructure spending, rising demand for coastal protection and restoration, and growing investments in renewable energy projects, particularly offshore wind farms. Additionally, the company's strategic expansion into new markets and its focus on environmental dredging services also contribute to its growth.

Rivers and Lakes

Expected Growth: 10%

Rivers and Lakes segment growth driven by increasing demand for dredging services, government investments in waterway infrastructure, and rising need for coastal protection and restoration projects. Additionally, growing focus on environmental sustainability and climate change mitigation efforts contribute to the 10% growth rate.

7. Detailed Products

Dredging

Great Lakes Dredge & Dock Corporation provides dredging services for navigation, coastal protection, and beach nourishment projects.

Environmental Remediation

The company offers environmental remediation services for contaminated soil and groundwater, including dredging and disposal of contaminated materials.

Coastal Protection

Great Lakes Dredge & Dock Corporation provides coastal protection services, including beach nourishment, dune restoration, and storm damage repair.

Marine Construction

The company offers marine construction services, including pier construction, dock building, and seawall installation.

Rivers and Lakes

Great Lakes Dredge & Dock Corporation provides dredging and construction services for rivers and lakes, including dam construction and repair.

8. Great Lakes Dredge & Dock Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Great Lakes Dredge & Dock Corporation is medium, as there are some alternatives available for dredging services, but they are not highly attractive to customers.

Bargaining Power Of Customers

The bargaining power of customers for Great Lakes Dredge & Dock Corporation is low, as customers have limited options for dredging services and the company has a strong market presence.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Great Lakes Dredge & Dock Corporation is medium, as the company relies on a few key suppliers for equipment and materials, but has some flexibility to negotiate prices.

Threat Of New Entrants

The threat of new entrants for Great Lakes Dredge & Dock Corporation is low, as the industry has high barriers to entry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry for Great Lakes Dredge & Dock Corporation is high, as the company operates in a highly competitive industry with several established players, and pricing pressure is significant.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 53.40%
Debt Cost 3.95%
Equity Weight 46.60%
Equity Cost 8.97%
WACC 6.29%
Leverage 114.59%

11. Quality Control: Great Lakes Dredge & Dock Corporation passed 1 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

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Concrete Pumping Holdings

A-Score: 5.4/10

Value: 4.5

Growth: 5.3

Quality: 3.6

Yield: 7.0

Momentum: 8.0

Volatility: 3.7

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Matrix Service

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Value: 8.4

Growth: 4.8

Quality: 5.2

Yield: 0.0

Momentum: 7.0

Volatility: 4.0

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Tutor Perini

A-Score: 4.6/10

Value: 5.9

Growth: 4.7

Quality: 4.4

Yield: 0.0

Momentum: 9.5

Volatility: 3.0

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Great Lakes Dredge & Dock

A-Score: 4.5/10

Value: 6.8

Growth: 4.1

Quality: 4.5

Yield: 0.0

Momentum: 6.0

Volatility: 5.3

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Orion Holdings

A-Score: 4.4/10

Value: 5.2

Growth: 5.7

Quality: 4.2

Yield: 0.0

Momentum: 9.0

Volatility: 2.3

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A-Score: 4.3/10

Value: 4.1

Growth: 5.0

Quality: 5.3

Yield: 0.0

Momentum: 4.0

Volatility: 7.7

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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

12.86$

Current Price

12.86$

Potential

-0.00%

Expected Cash-Flows