Back to top

Image: Shutterstock

Here's Why You Should Retain Envestnet (ENV) in Your Portfolio

Read MoreHide Full Article

Envestnet, Inc. (ENV - Free Report) has an impressive Growth Score of B. This style score condenses all the essential metrics from a company’s financial statements to get a true sense of the quality and sustainability of its growth. Envestnet’s revenues are expected to register 18% growth in 2021 and 14.8% in 2022.

Factors That Bode Well

Envestnet’s technology-enabled services are expected to register handsome growth as trends like increasing demand for personalized wealth management services and cost-effective guided advice are creating significant market opportunities.

ENV business model ensures solid asset-based and subscription-based recurring revenue-generation capacity. Asset-based recurring revenues of $170 million increased 39% and subscription-based recurring revenues of $113 million were up 7% in second-quarter 2021.

Envestnet focuses on technology development to improve operational efficiency, increase market competitiveness, address regulatory demands and cater to client-driven requests for new capabilities. The company’s technology design facilitates significant scalability.

Debt Woe Stays

Envestnet exited the third-quarter 2021 with a cash and cash equivalent balance of $394 million, significantly lower than the long-term debt of $848 million. This indicates that the company does not have enough cash to meet this debt burden.

Zacks Rank and Stocks to Consider

Envestnet currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the broader Zacks Business Services sector are Avis Budget (CAR - Free Report) , Cross Country Healthcare, Inc. (CCRN - Free Report) and CRA International, Inc. (CRAI - Free Report) .

Avis Budget has an expected earnings growth rate of around 453.5% for the current year. CAR has a trailing four-quarter earnings surprise of 76.9%, on average.

Avis Budget’s shares have surged 513.9% in the past year. CAR has a long-term earnings growth of 18.8%. CAR sports a Zacks #1 Rank.

Cross Country Healthcare has an expected earnings growth rate of around 500% for the current year. CCRN has a trailing four-quarter earnings surprise of 75%, on average.

Cross Country Healthcare’s shares have surged 209.5% in the past year. CCRN has a long-term earnings growth of 21.5%. CCRN flaunts a Zacks #1 Rank.

CRA International has an expected earnings growth rate of around 61.2% for the current year. CRA International has a trailing four-quarter earnings surprise of 51%, on average.

CRA International’s shares have surged 83.5% in the past year. CRA International has a long-term earnings growth of 15.5%. The stock carries a Zacks #2 (Buy) Rank.