Can Willdan's Deal Pipeline Power 2026 EPS Growth Ahead?

Willdan Group WLDN is closing 2025 with strong momentum, and the key investor question is whether its expanding deal pipeline can translate into another year of solid EPS growth in 2026.

Third-quarter 2025 results show clear operating leverage. Contract revenue rose 15% year over year to $182 million, while net revenue climbed 26% year over year to $95 million. Adjusted EBITDA increased 53% year over year to $23.1 million, and adjusted diluted EPS jumped 66% year over year to $1.21. For the first nine months, adjusted EPS nearly doubled to $3.34, reflecting margin expansion and disciplined cost control.  

The earnings call highlighted a “strong pipeline of opportunities” being converted into contracts, with momentum heading into 2026. Recent wins include a two-year, $97 million Alameda County project and multiple substation awards tied to solar and storage, many led by the APG acquisition. Management noted that APG has already won a record backlog and is expected to drive more than 50% growth for that unit in 2026.

The pipeline is underpinned by structural demand. Utilities, commercial customers and governments are responding to electricity load growth from data centers, electrification and grid modernization. Willdan’s Energy segment, which represents roughly 85% of revenue, is well positioned to benefit.

With net debt reduced to just $16 million and leverage at 0.2x adjusted EBITDA, the company also retains financial flexibility to pursue further bolt-on acquisitions. The pending Compass Municipal Advisors deal, which was expected to close Jan. 1, 2026, should expand its municipal advisory footprint.

While execution risk and project timing remain variables, the combination of record backlog, rising infrastructure demand and disciplined balance sheet management suggests Willdan’s deal pipeline could meaningfully support 2026 EPS growth.

Competitive Landscape Shaped by ICF International and Tetra Tech

Two relevant peers in Willdan’s energy and infrastructure consulting space are ICF International ICFI and Tetra Tech TTEK. Both ICF International and Tetra Tech compete for utility advisory work, grid modernization programs and government-funded energy projects that are central to Willdan’s 2026 growth thesis.

ICF International has a strong footprint in utility consulting and energy efficiency program management. The company benefits from large federal and state contracts that provide visibility and recurring revenue streams. At the same time, ICF International’s diversified exposure to public health, disaster recovery and digital modernization means energy is one of several growth pillars rather than the sole focus.

Tetra Tech is a major engineering and consulting firm with deep capabilities in power, water and environmental services. The company competes for substation, transmission and infrastructure modernization assignments similar to those targeted by Willdan. Tetra Tech’s global scale and technical depth allow it to pursue large, complex projects.

Both ICF International and Tetra Tech underscore the competitive backdrop. Still, Willdan’s concentrated exposure to data center-driven electricity demand may offer a sharper earnings catalyst.

WLDN Stock’s Price Performance & Valuation Trend

Shares of this California-based company have lost 6.5% in the past six months compared with the Zacks Business - Services industry’s 22.9% decrease. It has lagged the S&P 500 Index, as shown below.

WLDN’s Share Price Performance

WLDN stock is currently trading at a premium compared with its industry peers, with a forward 12-month price-to-earnings (P/E) ratio of 24.86, as shown in the chart below.

WLDN’s Valuation

Earnings Estimate Revision for WLDN

WLDN’s earnings estimates for fiscal 2026 have remained unchanged over the past 60 days. However, the estimated figures for fiscal 2026 imply year-over-year growth of 9.6%.
 

Willdan stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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