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Why Should Investors Bet on CRA International (CRAI) Stock?

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CRA International, Inc. (CRAI - Free Report) is a consulting services provider that has performed well in the past year and has the potential to sustain the momentum in the near term. Consequently, if you haven’t taken advantage of the share-price appreciation yet, it’s time you add the stock to your portfolio.

What Makes CRA International an Attractive Pick?

An Outperformer: A glimpse at the company’s price trend reveals that the stock has had an impressive run on the bourse in the past year. Shares of CRA International have returned 82.6% compared with a 57.4% rise of the industry.

Zacks Investment ResearchImage Source: Zacks Investment Research

Solid Rank & VGM Score: CRA International currently carries a Zacks Rank #2 (Buy) and has a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities. Thus, the company seems to be an appropriate investment proposition at the moment. You can see the complete list of today’s Zacks #1 Rank stocks here.

Northward Estimate Revisions: The direction of estimate revisions serves as an important pointer when it comes to the price of a stock. Three estimates for 2021 moved north in the past 60 days versus no southward revision for CRA International, reflecting analysts’ confidence in the stock. Over the same period, the Zacks Consensus Estimate for 2021 earnings has moved 7.6% north.

Positive Earnings Surprise History: CRA International has an impressive earnings surprise history. The company outpaced the consensus mark in all of the trailing four quarters, delivering an average beat of 51%.

Strong Growth Prospects: The Zacks Consensus Estimate of $5.40 for CRA International’s 2021 earnings reflects year-over-year growth of 61.2%. Revenues are expected to register 12% growth in 2021.

Growth Factors:  CRA International’s total debt-to-total capital ratio was 0.03 at the end of third-quarter 2021 compared with 0.19 at the end of the previous quarter. The declining debt-to-capitalization ratio indicates that the proportion of debt to finance the company’s assets is decreasing and so is the risk of insolvency. Cash and cash equivalent balance of $20 million at the end of the quarter was far above its current debt level of $6 million.

CRAI’s international presence allows it to work with the world’s leading professionals on multiple issues. This helps the company enhance its knowledge base and areas of functional expertise.

We are impressed with CRA International’s consistent record of returning value to shareholders in the form of dividend payouts and share repurchases. In 2020, 2019 and 2018, the company repurchased shares worth $13.4 million, $18.1 million and $27.9 million, respectively. It paid out $7.39 million, $6.54 million and $5.78 million in dividends during 2020, 2019 and 2018, respectively. Such moves indicate the company’s commitment to boost shareholders’ value and underline its confidence in its business. These initiatives instill investors’ confidence and positively impact earnings per share.

Other Stocks to Consider

Some other top-ranked stocks in the broader Zacks Business Services sector are Avis Budget (CAR - Free Report) , Cross Country Healthcare, Inc. (CCRN - Free Report) and FTI Consulting, Inc. (FCN - 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 506.9% in the past year. CAR has a long-term earnings growth of 18.8%. CAR sports a Zacks Rank #1.

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 199.9% in the past year. CCRN has a long-term earnings growth of 21.5%. CCRN flaunts a Zacks Rank #1.

FTI Consulting has an expected earnings growth rate of around 11.2% for the current year. FCN has a trailing four-quarter earnings surprise of 41.8%, on average.

FTI Consulting’s shares have surged 35.8% in the past year compared with a 57.4% surge of the industry it belongs to. FCN carries a Zacks Rank #2.
 

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