TPC

Tutor Perini is a real turnaround story in 2025, not a paper one. Revenue jumped 28% to $5.54B, the company swung from a $103.8M construction loss in 2024 to $232M of construction income, and operating cash flow hit a record $748M — enough to voluntarily prepay $121.9M of Term Loan B and grow cash 61% to $735M. The backlog narrative is the strongest part of the file: 2025 new awards of $7.4B include the $1.87B Midtown Bus Terminal, the $1.18B Manhattan Tunnel, and a ~$1B California healthcare project, all described as 'early stage' and expected to 'ramp up substantially over the next several years.' Margins should mechanically improve as these higher-margin jobs replace the legacy disputes that produced four straight years of losses (2022–2024 net income: -$210M, -$171M, -$164M).

The valuation is where the call gets hard. At $82.43, TPC trades at 54.6x reported diluted EPS of $1.51 — but management explicitly flags that GAAP EPS was crushed by $150M of share-based compensation expense driven by a 176.9% stock-price increase remeasuring liability-classified awards. Their own adjusted diluted EPS is $4.29, putting the stock closer to ~19x adjusted earnings, and management projects SBC expense falls in 2026 and 'much more significantly' in 2027 as most liability awards vest. On price-to-sales the stock is just 0.8x, which is reasonable for a low-margin general contractor (FY25 net margin 1.5%, operating margin 4.2%) that has finally turned the corner. So you have a re-rating that has already largely happened — the stock has tripled — meeting a business that is genuinely better but still structurally thin-margin.