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Why You Should Retain Envestnet (ENV) in Your Portfolio Now
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Envestnet, Inc. (ENV - Free Report) is currently being aided by its recurring revenue-generation capacity and development in technology.
ENV’s 2022 and 2023 revenues are anticipated to grow 4.7% and 4.3% each from the respective year-ago reported figures. Shares of ENV have rallied 24.6% in the past month compared with the 9.7% increase of the industry it belongs to.
Image Source: Zacks Investment Research
Factors That Augur Well
Envestnet’s business model ensures solid asset-based and subscription-based recurring revenue-generation capacity. ENV provides asset-based and subscription-based services on a business-to-business-to-consumer (B2B2C) basis to financial services clients. These clients offer solutions based on ENV’s platform to their end users.
Envestnet continues focusing on technological upgrades to improve operational efficiency, increase market competitiveness, address regulatory demands and cater to client-driven requests for new capabilities. Currently, ENV’s technology platforms are based on a three-tier architecture combining a web-based user interface, an application tier housing the business logic for all the platforms’ functionality and an SQL Server database. Management believes that ENV’s technology-based designs allow significant scalability.
A Key Risk
Envestnet's current ratio at the end of the September quarter was pegged at 0.64, lower than the current ratio of 0.77 reported at the end of the June quarter and the prior-year quarter’s current ratio of 2.04. A decreasing current ratio is undesirable as it indicates a company’s inefficiency in meeting its short-term debt obligations.
Image: Shutterstock
Why You Should Retain Envestnet (ENV) in Your Portfolio Now
Envestnet, Inc. (ENV - Free Report) is currently being aided by its recurring revenue-generation capacity and development in technology.
ENV’s 2022 and 2023 revenues are anticipated to grow 4.7% and 4.3% each from the respective year-ago reported figures. Shares of ENV have rallied 24.6% in the past month compared with the 9.7% increase of the industry it belongs to.
Image Source: Zacks Investment Research
Factors That Augur Well
Envestnet’s business model ensures solid asset-based and subscription-based recurring revenue-generation capacity. ENV provides asset-based and subscription-based services on a business-to-business-to-consumer (B2B2C) basis to financial services clients. These clients offer solutions based on ENV’s platform to their end users.
Envestnet continues focusing on technological upgrades to improve operational efficiency, increase market competitiveness, address regulatory demands and cater to client-driven requests for new capabilities. Currently, ENV’s technology platforms are based on a three-tier architecture combining a web-based user interface, an application tier housing the business logic for all the platforms’ functionality and an SQL Server database. Management believes that ENV’s technology-based designs allow significant scalability.
A Key Risk
Envestnet's current ratio at the end of the September quarter was pegged at 0.64, lower than the current ratio of 0.77 reported at the end of the June quarter and the prior-year quarter’s current ratio of 2.04. A decreasing current ratio is undesirable as it indicates a company’s inefficiency in meeting its short-term debt obligations.
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 Booz Allen Hamilton Holding Corporation (BAH - Free Report) , Paychex, Inc. (PAYX - Free Report) and Cross Country Healthcare, Inc. (CCRN - Free Report) .
Booz Allen carries a Zacks Rank #2 (Buy) at present. BAH has a long-term earnings growth expectation of 7.5%.
Booz Allen delivered a trailing four-quarter earnings surprise of 8.8%, on average.
Paychex carries a Zacks Rank of 2 at present. PAYX has a long-term earnings growth expectation of 7.5%.
Paychex delivered a trailing four-quarter earnings surprise of 8.6%, on average.
Cross Country Healthcare sports a Zacks Rank #1, currently. CCRN has a long-term earnings growth expectation of 6%.
CCRN delivered a trailing four-quarter earnings surprise of 10.1%, on average.