4 Business Services Stocks That Popped More Than 50% in 2018

The Business Services sector (as the name suggests) is engaged in providing services for the successful implementation of any kind of businesses in the economy.

Companies in the Zacks Business Services sector offer a wide array of services such as staffing, consulting, advertising and marketing, outsourcing, technology, financial transaction, waste removal, business information, and auction and valuation.

The Zacks Business Services sector accounts for the lion’s share of the U.S. GDP and recorded a year-to-date rally of 3.5% against the 1.3% decline of the Zacks S&P 500 composite.

 

What’s Driving the Business Services Sector?

Given its widely diversifiednature, the outlook for the sector is highly dependent on the broader economy, which is currently being helped by Trump’s policies. Government spending, especially in defense, has fueled a significant acceleration in economic growth since mid-2017.

Post the 2017 tax reform, corporate spending has increased significantly with U.S. companies pouring tax savings into growth initiatives. This has kept manufacturing and non-manufacturing activities in good shape, thus boosting the economy and spurring demand for business services.

Consumer spending, which accounts for more than two thirds of U.S. economic activity, has been strong. Purchasing power increased driven by increasing wages, lower unemployment and the new tax law that slashed income tax rates for many individuals.

All these factors acted as key growth catalysts for GDP growth. Notably, U.S. gross domestic product (GDP) grew at an annualized rate of 3.5% in the third quarter of 2018, per the “second” estimate released by the Bureau of Economic Analysis (BEA) on Nov 28.

Four Significant Gainers in 2018

The U.S. economy has benefited from rise in consumer spending, improvement in labor market, higher customer confidence and rise in wages. Additionally, three interest rate hikes this year by the Fed, indicating inherent economic stability, have boosted investors’ confidence. As the curtains roll down on an eventful year, let us do a quick recap of the four well performing Business Services stocks of 2018.

These stocks have gained more than 50% in 2018. These also have a favorable Zacks Rank #1 (Strong Buy) or 2 (Buy) and have market capitalization of more than $1 billion. You can see the complete list of today’s Zacks #1 Rank stocks here.

Insperity, Inc. NSP: The stock of this Texas-based provider of human resources (HR) and business solutions has gained 67.9% year to date. Currently, it sports a Zacks Rank #1 and has a market capitalization of $4 billion.

 

SPS Commerce, Inc. SPSC: The stock of this Minnesota-based provider of cloud-based supply chain management solutions has climbed 73.5% year to date. Currently, it sports a Zacks Rank #1 and has a market capitalization of $1.45 billion.

 

Cardtronics plc CATM: The stock of this Texas-based provider of automated consumer financial services has risen 66.4% year to date. Currently, it sports a Zacks Rank #1 and has a market capitalization of $1.39 billion.

 

EVERTEC, Inc. EVTC: The stock of this Puerto Rico-based provider of transaction processing business solutions has gained 96.5% year to date. Currently, it sports a Zacks Rank #2 and has a market capitalization of $1.95 billion.

 

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Cardtronics PLC (CATM) : Free Stock Analysis Report
 
SPS Commerce, Inc. (SPSC) : Free Stock Analysis Report
 
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Evertec, Inc. (EVTC) : Free Stock Analysis Report
 
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