Maximus (NYSE:MMS) Announces Quarterly Earnings Results, Beats Expectations By $0.01 EPS

Key Points

• Maximus beat EPS expectations: Fiscal third-quarter adjusted EPS was $2.22, up from $2.16 a year earlier, while improved adjusted EBITDA margins supported profitability. Revenue of $1.28 billion missed estimates and declined 5.1% year over year.
• Fiscal 2026 profit guidance was lowered: The company now expects adjusted EPS of $7.90–$8.20, partly due to a temporary pause in VA Medical Disability Exam performance incentives that is expected to reduce fourth-quarter EPS by about $0.35. Revenue guidance was maintained at $5.2–$5.35 billion, biased toward the lower end.
• Cash flow and growth prospects remain key positives: Maximus received approximately $245 million from a major federal customer and maintained free-cash-flow guidance of $425–$475 million. Management expects U.S. Services to return to mid-single-digit organic growth, although procurement delays and contract uncertainty are slowing pipeline conversion.

Maximus (NYSE:MMS - Get Free Report) released its quarterly earnings data on Thursday. The health services provider reported $2.22 EPS for the quarter, beating analysts' consensus estimates of $2.21 by $0.01, Zacks reports. The company had revenue of $1.28 billion during the quarter, compared to the consensus estimate of $1.33 billion. Maximus had a net margin of 7.07% and a return on equity of 24.91%. Maximus's quarterly revenue was down 5.1% on a year-over-year basis. During the same quarter in the prior year, the firm earned $2.16 EPS. Maximus updated its FY 2026 guidance to 7.900-8.200 EPS.

Here are the key takeaways from Maximus' conference call:

• Third-quarter results were solid: revenue reached $1.28 billion, adjusted EBITDA margin improved to 15.0% from 14.7%, and adjusted EPS rose to $2.22 from $2.16 year over year. Maximus reiterated fiscal 2026 revenue guidance of $5.2 billion to $5.35 billion, though it remains biased toward the lower end.
• A temporary pause in performance incentives on the VA Medical Disability Exam contract is expected to reduce fourth-quarter adjusted EPS by approximately $0.35. Maximus lowered fiscal 2026 adjusted EPS guidance to $7.90–$8.20 and expects fourth-quarter adjusted EBITDA margin of approximately 13%.
• Collections from a major federal customer accelerated, with approximately $245 million received since June 30. Management still expects DSO to fall below 70 days by fiscal year-end and free cash flow to range from $425 million to $475 million.
• Maximus expects U.S. Services to return to positive mid-single-digit organic growth in the fourth quarter as Medicaid-related outreach and engagement volumes increase. SNAP accuracy initiatives, AI-enabled solutions, and defense and national security opportunities were highlighted as longer-term growth drivers.
• The company reported a $50.4 billion sales pipeline, but procurement delays, scope revisions, cancellations, and increased use of bridge contracts are slowing opportunity maturation. Awarded-but-unsigned contracts increased to $1.35 billion, which management expects to support improving book-to-bill in future quarters.

Maximus Trading Up 1.5%

Shares of MMS traded up $0.88 during midday trading on Friday, hitting $59.21. 1,378,337 shares of the stock were exchanged, compared to its average volume of 623,694. Maximus has a 52-week low of $52.73 and a 52-week high of $100.00. The company has a debt-to-equity ratio of 0.90, a quick ratio of 2.21 and a current ratio of 2.42. The stock has a fifty day simple moving average of $58.63 and a 200 day simple moving average of $67.46. The firm has a market cap of $3.11 billion, a P/E ratio of 8.75 and a beta of 0.59.

Maximus Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Monday, August 31st. Stockholders of record on Friday, August 14th will be given a dividend of $0.33 per share. This represents a $1.32 annualized dividend and a dividend yield of 2.2%. The ex-dividend date is Friday, August 14th. Maximus's dividend payout ratio (DPR) is currently 19.76%.

Analysts Set New Price Targets

MMS has been the topic of several analyst reports. Weiss Ratings lowered Maximus from a "hold (c)" rating to a "hold (c-)" rating in a report on Wednesday, May 20th. Zacks Research cut shares of Maximus from a "strong-buy" rating to a "hold" rating in a research report on Monday, April 27th. Finally, Wall Street Zen downgraded shares of Maximus from a "buy" rating to a "hold" rating in a research note on Saturday. Two equities research analysts have rated the stock with a Hold rating, Based on data from MarketBeat, the company has an average rating of "Hold".

Key Maximus News

Here are the key news stories impacting Maximus this week:

• Positive Sentiment: Fiscal Q3 adjusted earnings were $2.22 per share, ahead of analyst estimates of approximately $2.20–$2.21 and up from $2.16 a year earlier. Higher margins also supported the quarter’s bottom-line performance. Maximus Q3 Earnings Beat Estimates, Increase Year Over Year
• Positive Sentiment: The earnings beat, year-over-year EPS growth and stronger margins indicate that Maximus is maintaining profitability even as sales soften. Maximus Q3 Earnings Beat Estimates
• Neutral Sentiment: Management’s fiscal Q3 earnings call focused on the quarterly performance and updated outlook, providing investors with additional context on operating trends and the company’s expectations for the remainder of fiscal 2026. Maximus Q3 2026 Earnings Call Transcript
• Negative Sentiment: Revenue was $1.28 billion, below the $1.33 billion consensus estimate and down 5.1% year over year. The shortfall suggests softer demand or project timing is limiting growth. Maximus Fiscal Q3 Earnings Snapshot
• Negative Sentiment: Maximus reduced fiscal 2026 EPS guidance to $7.90–$8.20, below the consensus estimate of $8.43. Revenue guidance of $5.2–$5.4 billion remains broadly in line with expectations at the midpoint, but the lower profit outlook is a key overhang for MMS. Updated Maximus Fiscal 2026 Guidance

Hedge Funds Weigh In On Maximus

Several hedge funds have recently bought and sold shares of the company. Dimensional Fund Advisors LP grew its position in Maximus by 5.2% in the 4th quarter. Dimensional Fund Advisors LP now owns 1,965,916 shares of the health services provider's stock valued at $169,700,000 after acquiring an additional 96,343 shares in the last quarter. Boston Partners lifted its position in shares of Maximus by 47.0% during the third quarter. Boston Partners now owns 966,139 shares of the health services provider's stock worth $88,236,000 after purchasing an additional 308,892 shares in the last quarter. Goldman Sachs Group Inc. lifted its position in shares of Maximus by 218.4% during the fourth quarter. Goldman Sachs Group Inc. now owns 583,627 shares of the health services provider's stock worth $50,379,000 after purchasing an additional 400,315 shares in the last quarter. Nuveen LLC boosted its stake in shares of Maximus by 29.1% in the fourth quarter. Nuveen LLC now owns 534,083 shares of the health services provider's stock valued at $46,102,000 after purchasing an additional 120,501 shares during the period. Finally, Bank of America Corp DE boosted its stake in shares of Maximus by 24.6% in the third quarter. Bank of America Corp DE now owns 453,616 shares of the health services provider's stock valued at $41,447,000 after purchasing an additional 89,693 shares during the period. Institutional investors and hedge funds own 97.21% of the company's stock.

Maximus Company Profile

Maximus, Inc NYSE: MMS is a global provider of government services focused on delivering health and human services programs. The company partners with federal, state, and local agencies to administer and manage programs that support individuals and families across various stages of life. Key service areas include eligibility determination and enrollment services for Medicaid, Medicare, Children's Health Insurance Program (CHIP) and other public assistance programs, as well as call center operations, case management and program integrity solutions.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

Continue following MarketBeat

Add MarketBeat as your preferred source on Google to see our latest stories in your feed.

Add As Preferred Source