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NV5 Global, Inc. (NASDAQ:NVEE): Is It A Smart Long Term Opportunity?

Simply Wall St

Looking at NV5 Global, Inc.'s (NASDAQ:NVEE) earnings update on 29 June 2019, analysts seem cautiously optimistic, as a 30% increase in profits is expected in the upcoming year, though this is relatively lower than the previous 5-year average earnings growth of 40%. Currently with trailing-twelve-month earnings of US$27m, we can expect this to reach US$35m by 2020. Below is a brief commentary around NV5 Global's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those interested in more of an analysis of the company, you can research its fundamentals here.

Check out our latest analysis for NV5 Global

Can we expect NV5 Global to keep growing?

The longer term view from the 3 analysts covering NVEE is one of positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To get an idea of the overall earnings growth trend for NVEE, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.

NasdaqCM:NVEE Past and Future Earnings, August 29th 2019

From the current net income level of US$27m and the final forecast of US$55m by 2022, the annual rate of growth for NVEE’s earnings is 24%. This leads to an EPS of $4.72 in the final year of projections relative to the current EPS of $2.44. In 2022, NVEE's profit margin will have expanded from 6.4% to 9.7%.

Next Steps:

Future outlook is only one aspect when you're building an investment case for a stock. For NV5 Global, I've compiled three relevant factors you should further examine:

  1. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
  2. Valuation: What is NV5 Global worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether NV5 Global is currently mispriced by the market.
  3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of NV5 Global? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.