EFOR · Everforth
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $43.59
Note written ·
Price against the kill line
18.4% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $43.59, on record since 11 November 2026. The shares are up 15.2% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $43.59, the 23 October 2026 close and the late-October high, would show the shares leading the S&P 500. So would Q4 2026 revenue above the $995.0 million top of guidance.
Research onlyNot in the portfolio.
Key figures from the filings · Industrials
Quarter to 30 September 2026, filed 30 October 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 1,031
- Revenue, change on a year (%)
- +2.0
- Gross margin (%)
- 28.3
- Operating margin (%)
- 5.5
- Free cash flow, four quarters ($M)
- 196
- Net cash, cash less debt ($M)
- −1,244
- Price to earnings (×)
- 21.5
- Enterprise value to sales (×)
- 0.7
All filed numbers
What Everforth reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 1,031 | +2.0 | 28.3 | 5.5 |
| first filed | 1,007 | −1.3 | 28.3 | 4.1 |
| first filed | 968 | 0.0 | 27.5 | 2.9 |
| first filed | 980 | −0.5 | 28.9 | 5.7 |
| first filed | 1,011 | −1.9 | 29.4 | 6.7 |
| first filed | 1,021 | −1.4 | 28.7 | 5.8 |
| Pre-tax income ($M) | 36.4 |
| Net income ($M) four quarters: 68.0 | 23.1 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | −5.9 |
| Operating cash flow ($M) | 232 |
| Capital spending ($M) | 36.1 |
| Free cash flow ($M) | 196 |
| Cash and short-term investments ($M) | 148 |
| Debt ($M) long-term debt | 1,391 |
| Net cash, cash less debt ($M) | −1,244 |
| Deferred revenue ($M) +16.3% on a year | 34.9 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 786 |
| Inventory ($M) | Not reported |
| Shareholders' equity ($M) | 1,844 |
| Market value ($M) | 1,461 |
| Enterprise value, market value plus net debt ($M) | 2,705 |
| Enterprise value to sales (×) | 0.7 |
| Enterprise value to operating income (×) | 14.9 |
| Price to earnings (×) | 21.5 |
| Price to book value (×) | 0.8 |
| Free-cash-flow yield (%) | 13.4 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 8.2% of shares outstanding sold short, 4.9 days of average trading to cover, −2.9% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $0 |
| 12 monthsfrom | $1.9M | $0 |
The thesis
Everforth's shares look more likely to lag the S&P 500 than lead it into early 2027. Q3 2026 revenue beat guidance, but commercial consulting orders slowed and Q4 revenue guidance centers below consensus. The Q4 report, expected around 3 February 2027, settles whether federal awards turn into growth. A Q4 revenue result above the $995.0 million top of guidance, with Federal Government book-to-bill (new orders divided by billings) back at 1.0 to 1, would prove this view wrong.
The 28 October 2026 report was mixed. Revenue of $1,031.4 million rose 2.0% from a year earlier and beat guidance, while net income fell to $23.1 million from $38.1 million, per the company's Q3 release. Commercial IT consulting trailing-twelve-month book-to-bill slipped to 1.1 to 1 from 1.2 to 1, per the release and supplemental materials.
The price shows a cautious recovery. The shares closed at $35.99 on 11 November 2026, close to Wells Fargo's $38 target of 29 October 2026 and above MarketBeat's $33.83 average target as checked on 6 November 2026. That level assumes the business holds steady. It does not yet assume a return to clear growth.
Bullish and bearish views on Everforth, Inc.
The bull case on Everforth, Inc. (EFOR), in brief: Q3 beat the top of guidance. The bear case: profit fell as revenue rose.
Bull case
- Q3 beat the top of guidance. Revenue of $1,031.4 million topped the $994.0 million to $1,024.0 million guide, and adjusted earnings per share of $1.11 topped the $1.10 high end (company release, 28 October 2026). Benzinga put consensus at $1.011 billion and $1.02.
- Federal orders jumped in the quarter. New federal awards were $584.4 million, a 1.9 times quarterly book-to-bill, per HSTong's 29 October 2026 summary of the earnings call. The trailing-twelve-month figure rose to 0.9 to 1 from 0.8 to 1, and segment revenue rose 3.8% to $311.5 million.
- New agency work keeps coming. On 3 November 2026, Everforth ECS announced an extension of up to two years to its prime contract with the National Geospatial-Intelligence Agency, with potential value above $200 million. Per the same call summary, management expects new federal awards to show more clearly from the first quarter of fiscal 2027.
- Security and media clients are growing. Security and risk bookings rose more than 40% from the first nine months of 2025. Revenue from technology, media and telecom clients grew in the mid-teens percent year over year (HSTong call summary, 29 October 2026).
Bear case
- Profit fell as revenue rose. Q3 adjusted earnings per share were $1.11, down from $1.31 a year earlier (company release, 28 October 2026). Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) margin fell to 10.3% from 11.1%.
- Q4 guidance centers below consensus. The $965.0 million to $995.0 million revenue guide has a $980.0 million midpoint, below Benzinga's $987.5 million consensus, and Finsee's review calls it flat year over year. "I just don't see Q4 as an accelerating quarter on a normal basis," management said on the 28 October 2026 call, per HSTong.
- Consulting orders lost momentum. Commercial IT consulting book-to-bill fell to 1.1 to 1 at Q3 from 1.2 to 1 at Q2. Commercial revenue rose only 1.2% to $719.9 million. Finsee, a third-party earnings reviewer, estimates the division's underlying sales fell about 2.3%.
- Cash generation weakened. Free cash flow was $46.5 million, down from $72.0 million a year earlier (company release, 28 October 2026). The company made no share repurchases in Q3 and paid down $52.8 million of debt. Finsee puts quarter-end long-term debt at $1,391.0 million.
- Analyst views are far apart. On 29 October 2026, UBS kept its Sell rating with a $19 target and Wells Fargo kept Equal-Weight with a $38 target (Benzinga). The UBS target is roughly half the 11 November 2026 close.
Price setup
The shares closed at $35.99 on 11 November 2026. That is above the 50-day moving average of $35.45 and the 200-day moving average of $31.49. Both averages are from adjusted daily closes as of 11 November 2026.
The shares fell from $36.98 on 4 November 2026 to $34.34 on 6 November 2026. They then recovered to $35.64 on 9 November 2026, $35.96 on 10 November 2026 and $35.99 on 11 November 2026. Over three months the shares are up 7.6%, from a $33.45 close on 13 August 2026.
On the longer view, the last close is 34.5% below the 52-week intraday high of $54.94 set on 5 February 2026. The 52-week closing low was $17.06 on 25 June 2026. The case turns on whether the shares can retake the late-October highs before the Q4 report. No company-scheduled event falls before then.
Catalysts ahead
- ~3 February 2027 (est.): Q4 2026 results; the company has not announced a date. Tests the $965.0 million to $995.0 million revenue guide and shows whether federal awards are turning into revenue. It also gives management's first clearer read on 2027 client budgets.
What would change the view
A daily close above $43.59, the 23 October 2026 close and the late-October high, would show the shares leading the S&P 500. So would Q4 2026 revenue above the $995.0 million top of guidance.
What it trades with
Commercial made up 70% of Q3 revenue and Federal Government 30% (company release, 28 October 2026). The shares therefore carry two separate exposures: enterprise IT budgets and US agency spending. On the 28 October 2026 call, management tied platform demand to Workday, Salesforce and ServiceNow, per HSTong. Those vendors' comments on enterprise demand bear on the consulting business. Federal results follow agency awards, such as the 3 November 2026 geospatial extension, and the pace of federal budget decisions.
The evidence, claim by claim (8)
- Q3 2026 revenue was $1,031.4 million, up 2.0% from $1,011.4 million; Commercial was $719.9 million, up 1.2%, and Federal Government was $311.5 million, up 3.8%. Everforth Q3 2026 earnings release, Form 8-K · as of
- Q3 2026 adjusted earnings per share were $1.11 against $1.31 a year earlier and a $1.02 consensus; net income was $23.1 million against $38.1 million. Everforth Q3 2026 earnings release; Benzinga · as of
- Commercial IT consulting trailing-twelve-month book-to-bill was 1.1 to 1, down from 1.2 to 1 at Q2; Federal Government was 0.9 to 1, up from 0.8 to 1. Everforth Q3 2026 release and supplemental materials · as of
- Q3 2026 federal new contract awards were $584.4 million, a 1.9 times quarterly book-to-bill. HSTong summary of the 28 October 2026 earnings call · as of
- Q4 2026 guidance is revenue of $965.0 million to $995.0 million and adjusted earnings per share of $0.95 to $1.11, against consensus of $987.5 million and $1.01. Everforth Q3 2026 earnings release; Benzinga guidance headlines · as of
- Q3 2026 free cash flow was $46.5 million against $72.0 million a year earlier; there were no share repurchases and debt fell by $52.8 million. Everforth Q3 2026 earnings release, Form 8-K · as of
- Everforth ECS announced a prime contract extension of up to two years with the National Geospatial-Intelligence Agency, with potential value above $200 million. Everforth ECS press release · as of
- UBS kept its Sell rating and raised its target to $19; Wells Fargo kept Equal-Weight and raised its target to $38. Benzinga · as of
Sources
- Everforth Inc - Form 8-K - FY2026 · sec.gov ·
- Everforth Q3 2026 Supplemental Materials · s21.q4cdn.com
- Everforth (EFOR) 2026财年第三季度财报电话会摘要 · hstong.com
- Everforth ECS Secures NGA Contract Extension With Potential Value Exceeding $200M, Advancing Operational GEOINT Capabilities · everforthecs.com
- Everforth (EFOR) Q3 2026 earnings review · finsee.ai
- Everforth (EFOR) Stock Price, News & Analysis $EFOR · marketbeat.com
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