FTI Consulting: $183M Bet Signals Upside After 16% Drop

Black Creek Investment Management made a significant move in FTI Consulting, purchasing 402,008 shares worth approximately $66 million during the fourth quarter. This transaction boosted their total FCN position to $183 million, representing 9.1% of their reportable assets under management. The investment firm now holds FCN as one of its top five convictions, alongside established names like Elanco and Booz Allen Hamilton.

FTI Consulting's stock has faced headwinds over the past year, declining 16% while underperforming the S&P 500 by nearly 30 percentage points. Despite this price weakness, the company continues to demonstrate solid financial fundamentals with a $5.3 billion market capitalization and $266 million in trailing twelve-month net income.

The timing of Black Creek's increased investment is particularly interesting given FCN's recent price of $160.91 per share. Institutional investors often use periods of stock weakness to build positions in companies they believe are temporarily undervalued relative to their long-term prospects.

This substantial investment represents a strong vote of confidence from a sophisticated money manager who clearly sees value where the broader market may have overlooked it.

The significance of this institutional bet becomes clearer when examining FTI Consulting's underlying business performance. The company recently reported record third-quarter revenue of $956 million, representing 3% year-over-year growth, while earnings per share surged 41% to $2.60. More importantly, management raised full-year EPS guidance, signaling confidence in continued strong performance.

FTI's diversified consulting services across corporate finance, restructuring, litigation, and strategic communications provide revenue stability that single-product companies lack. Demand for these specialized services tends to remain resilient during economic uncertainty, as businesses often need expert help navigating complex challenges.

The company's adjusted EBITDA margin expanded to 13.7%, demonstrating improved profitability despite the challenging market environment. This operational efficiency, combined with raised guidance, suggests the stock's recent weakness may not reflect the company's actual business strength.