U.S. Markets closed

Bull of the Day: Perficient (PRFT)

Brian Bolan

Perficient (PRFT) is a Zacks Rank #1 (Strong Buy) and has a solid growth style score of B. You know that puts it on my radar screen as I am always looking for growth stocks.  Let’s take a look at why this stock is the Bull of the Day.

Description

Perficient is the leading digital transformation consulting firm with unparalleled information technology, management consulting, and creative capabilities, Perficient and its Perficient Digital agency deliver vision, execution, and value with outstanding digital experience, business optimization, and industry solutions. Their work enables clients to improve productivity and competitiveness; grow and strengthen relationships with customers, suppliers, and partners; and reduce costs. Its solutions include big data and analytics, technology platform implementations, commerce, enterprise content management, portals and collaboration, management consulting, custom applications, business integration, business process management, and customer relationship management, among others.

Earnings History

I see a solid earnings history and that is important to any investment thesis.  You want to own stocks that are consistently beating expectations.  The reason for this is that management is good enough to understand their business and still able to communicate where Wall Street’s expectations should lie.  That way, they can always beat the number.

The most recent earnings on 2/26 was a solid beat of 7 cents in reporting EPS of $0.47 on $131.7M in sales compared to the $128.3M expectation.

Estimate Revisions

Following this beat, the Zacks Consensus Estimate moved higher.  Higher for this quarter, next quarter, the full year and next fiscal year.  I have to tell you, that is what investors like to see after a beat, strong estimate revisions that continue on a year out.

The current quarter raised up from $0.39 to $0.40 while the full year moved from $1.67 to $1.69.  Next year has limited visibility at this point, but that didn’t stop analysts from moving their numbers up and that pushed the consensus to $1.88 from $1.86.

Valuation

The value style score for this stock is a C, but it looks like it should be a lot higher to me.  I see a forward PE of 16x which is very reasonable and much better than the 22x trailing PE.  The price to book of 2.6x is below the 3x level that many value investors use are a cut off.  Finally I see the price to sales at 1.8x and that is comfortably above the 1x level that I like to see.  With margins inching higher, this stock looks like an excellent value here.

Chart

 

Perficient, Inc. Price and Consensus

Perficient, Inc. Price and Consensus | Perficient, Inc. Quote

Zacks' Top 10 Stocks for 2019

In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-holds for the year?

Who wouldn't? Our annual Top 10s have beaten the market with amazing regularity. In 2018, while the market dropped -5.2%, the portfolio scored well into double-digits overall with individual stocks rising as high as +61.5%. And from 2012-2017, while the market boomed +126.3, Zacks' Top 10s reached an even more sensational +181.9%.

See Latest Stocks Today >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Perficient, Inc. (PRFT) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research