Navigant Consulting, Inc. NCI is a consulting services stock that has performed well in the past three months and has the potential to sustain the momentum. Therefore, if you haven’t taken advantage of the share price appreciation yet, it’s time you add the stock to your portfolio.
Why an Attractive Pick?
Share Price Movement: A glimpse at the company’s price trend reveals that the stock has had an impressive run on the bourse over the past three months. Navigant’s shares have rallied 15.7% compared with the industry’s 9.3% rise.
Solid Zacks Rank: Navigant has a Zacks Rank #1 (Strong Buy). Our research shows that stocks with a Zacks Rank #1 or 2 (Buy) offer attractive investment opportunities for investors. You can see the complete list of today’s Zacks #1 Rank stocks here.
Northward Estimate Revisions: Two estimates for 2019 have moved north in the past 60 days versus no downward revision, which reflects analysts’ confidence in the company. Over the same period, the Zacks Consensus Estimate for 2019 moved up 3.4%.
Positive Earnings Surprise History: Navigant has an impressive earnings surprise history. The company outpaced the consensus mark in three of the trailing four quarters, delivering a positive average earnings surprise of 47.9%.
Strong Growth Prospects: The Zacks Consensus Estimate for 2019 earnings is currently pegged at 92 cents, reflecting year-over-year growth of 95.7%. Moreover, earnings are expected to register 15.6% growth in 2020. The stock has long-term expected EPS growth rate of 13.5%.
Growth Factors: The company’s managed services business is in good shape and currently a significant contributor to RBR. The business represented 30% of RBR in the first quarter.
The business is benefiting from improved operating execution in healthcare managed services, contribution from Health System Solutions (HSS) joint venture and a new Financial, Risk & Compliance Advisory (FSAC) segment managed services engagement.
The Energy segment continues to see strong demand from both commercial and government clients. The segment’s first quarter 2019 revenues before reimbursements (RBR) increased 8% year over year.
Navigant’scommitment toward creating value for shareholders underline its confidence in business. It returned more than $55 million to shareholders through share repurchases and dividends in the first quarter and is confident about achieving its goal to return up to $175 million by August 2019.
Other Stocks to Consider
Some other top-ranked stocks in the broader Zacks Business Services sector are Huron Consulting Group HURN, FLEETCOR Technologies FLT and Global Payments GPN, each carrying a Zacks Rank #2.
The long-term expected EPS (three to five years) growth rate for Huron, FLEETCOR and Global Payments is 13.5%, 15.4% and 17%, respectively.
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