Free cash flow generation remains highly erratic, evidenced by a sharp reversal from a $46.5 million surplus in 2025Q4 to a $17.3 million cash burn in 2026Q1.
| Cash from Operations | 90.33M | 107.48M | 22.23M | 56.02M | 20.65M | 37.58M | 1.85M | 17.04M | -2.85M |
| Operating CF Margin % | - | 12.94% | 3.19% | 8.97% | 3.79% | 6.88% | 0.56% | 7.29% | -1.51% |
| Operating CF Growth % | 2246.86% | 383.36% | -60.31% | 171.31% | -45.05% | 1931.41% | -89.14% | 699.02% | - |
| Net Income | 5.83M | -843K | -62.31M | -30.86M | -31.82M | -25.32M | -57.95M | -23.56M | -16.49M |
| Depreciation & Amortization | 50.25M | 50.91M | 64.33M | 55.97M | 56.77M | 52.96M | 37.27M | 27.7M | 23.91M |
| Stock-Based Compensation | 38.07M | 42.72M | 64.67M | 47.27M | 43.29M | 10.32M | 4.85M | 4.34M | 5.79M |
| Deferred Taxes | 4.02M | 9.9M | 4.29M | -980K | 2.25M | 1.71M | 851K | -3.12M | -4.97M |
| Other Non-Cash Items | -23.19M | 1.81M | 3.73M | -1.6M | -26.83M | 15.93M | 33.49M | 13.99M | 756K |
| Working Capital Changes | 15.36M | 2.97M | -52.47M | -13.78M | -23.01M | -18.02M | -16.67M | -2.33M | -11.85M |
| Change in Receivables | 12.1M | -10.07M | -41.98M | -2.92M | 4.39M | -36.16M | -19.2M | -6.59M | -10M |
| Change in Inventory | 0 | 0 | 0 | 0 | 0 | 0 | 19.2M | 0 | -11.29M |
| Change in Payables | -1.69M | 8.35M | 3.8M | -8.91M | -9.88M | 24M | 601K | 6.08M | -2.2M |
| Cash from Investing | -17.66M | -15.84M | -138.04M | -101.62M | -38.69M | -71.64M | -179.74M | -86.98M | -50.28M |
| Capital Expenditures | -19.52M | -17.01M | -21.33M | -29.58M | -10M | -6.88M | -7.78M | -4.69M | -4.11M |
| CapEx % of Revenue | 2.38% | 2.05% | 3.06% | 4.74% | 1.84% | 1.26% | 2.37% | 2.01% | 2.18% |
| Acquisitions | 712K | 712K | -113.09M | -66.19M | -28.63M | -55.73M | -171.98M | -81.37M | -45.84M |
| Investments | - | - | - | - | - | - | - | - | - |
| Other Investing | 1.15M | 458K | -3.63M | -5.86M | -60K | -9.03M | 20K | -921K | -339K |
| Cash from Financing | -93.14M | -93.12M | 106M | -20.11M | -38.76M | 146.1M | 205.9M | 74.45M | 50.85M |
| Debt Issued (Net) | 36.82M | 56.39M | 53.94M | -6.45M | -12.72M | -1.62M | 24.37M | 73.93M | -29.21M |
| Equity Issued (Net) | -128.01M | -123.58M | 61.78M | 0 | 1.46M | 169.78M | 199.38M | 0 | -2.72M |
| Dividends Paid | -1.4M | -4.15M | -11.06M | -16.4M | -16.4M | -16.4M | -6.97M | 0 | 0 |
| Share Repurchases | -132.23M | -122.23M | 0 | 0 | 0 | 0 | -131.82M | 0 | -2.72M |
| Other Financing | -544K | -21.78M | 1.35M | 2.74M | -11.11M | -5.66M | -10.87M | 518K | 82.78M |
| Net Change in Cash | -19.05M | -1.71M | -10.3M | -66.59M | -56.91M | 111.86M | 28M | 4.39M | -2.28M |
| Free Cash Flow | 71.5M | 91.16M | 902K | 23.09M | 10.65M | 30M | -5.93M | 12.33M | -6.95M |
| FCF Margin % | 8.71% | 10.98% | 0.13% | 3.7% | 1.96% | 5.49% | -1.81% | 5.27% | -3.68% |
| FCF Growth % | 137.95% | 10006.32% | -96.09% | 116.89% | -64.51% | 606.19% | -148.07% | 277.29% | - |
| FCF per Share | 1.98 | 2.60 | 0.03 | 0.77 | 0.36 | 1.12 | -0.36 | 0.49 | -0.33 |
| FCF Conversion (FCF/Net Income) | 12.27x | -127.49x | -0.36x | -1.82x | -0.65x | -1.48x | -0.03x | -0.72x | 0.17x |
| Interest Paid | 4.63M | 0 | 14.78M | 8.06M | 6.51M | 5.01M | 11.95M | 5.89M | 7.92M |
| Taxes Paid | 2.09M | 0 | 4.19M | 997K | 789K | 412K | 171K | 1.21M | 596K |
Persistent Negative Operating Cash
As reported in financial statements, MEG's operating cash flow frequently decouples from net income, with the OCF/NI ratio exhibiting extreme volatility, including a -6.32 reading in 2025Q4, which suggests that reported earnings are not currently serving as a reliable proxy for actual cash generation capabilities.
The persistent gap between net income and operating cash flow indicates that non-cash charges and working capital fluctuations are heavily distorting the firm's bottom line. Investors should monitor whether this divergence is a temporary byproduct of acquisition integration or a structural inability to convert service revenue into realized cash.
Based on recent SEC filings, MEG's free cash flow trajectory remains highly erratic, swinging from a peak of $46.5 million in 2025Q4 to a deficit of $17.3 million in 2026Q1, highlighting the difficulty in maintaining consistent cash generation amidst an aggressive acquisition-led growth strategy.
The lack of a stable free cash flow trend suggests that the company's operational model is highly sensitive to project timing and integration costs. This inconsistency complicates the valuation of the firm, as it remains unclear when the business will reach a sustainable, self-funding cash flow inflection point.
According to quarterly data, MEG's working capital management is characterized by significant, unpredictable shifts, such as the $24.7 million inflow in 2025Q4 followed by a $12.4 million outflow in 2025Q1, which suggests that the firm struggles to maintain a predictable cash conversion cycle across its segments.
These fluctuations likely reflect the lumpy nature of environmental remediation projects and the challenges of integrating disparate billing systems from acquired entities. Such volatility in working capital may force the company to rely more heavily on external financing to bridge liquidity gaps during periods of high project activity.
As evidenced by the company's financial disclosures, MEG has prioritized significant capital deployment toward share repurchases and acquisitions, including a $60 million buyback in 2025Q2, even while operating cash flow remains inconsistent and net margins stay in negative territory, warranting further investigation into capital return priorities.
The decision to return capital to shareholders or fund acquisitions while the core business is not yet consistently cash-flow positive appears aggressive. This strategy may limit the firm's financial flexibility and increase its vulnerability to interest rate fluctuations or unexpected operational disruptions in the future.
Based on reported figures, MEG consistently records substantial stock-based compensation, with quarterly charges often exceeding $10 million, which effectively masks the true economic cost of operations and complicates the assessment of the firm's underlying cash-generating potential for long-term equity holders.
By excluding these significant non-cash expenses from adjusted metrics, management may be presenting a more favorable view of profitability than the cash flow statement supports. Investors should be cautious of the dilutive impact of this compensation, which effectively acts as a recurring, albeit non-cash, drag on shareholder value.
Quick answers to the most common questions about buying MEG stock.
Montrose Environmental Group, Inc. (MEG) generated $107.5M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Montrose Environmental Group, Inc. (MEG) generated $91.2M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Montrose Environmental Group, Inc. (MEG) spent $17.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, Montrose Environmental Group, Inc. (MEG) returned $4.2M to shareholders via cash dividends and spent $122.2M on share repurchases. This shows the company's commitment to returning capital to its equity investors.