A prudent investment decision involves buying well-performing stocks at the right time, while selling those that are at risk. A rise in share price and strong fundamentals signal a stock’s bull run.
MAXIMUS, Inc. (MMS - Free Report) is a Government Services stock that has performed well in the past six months and has the potential to sustain the momentum in the near term. Consequently, if you haven’t taken advantage of its share price appreciation yet, it’s time you add the stock to your portfolio.
What Makes it 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 six months. Shares of MAXIMUS havereturned 12.3%, outperforming the Zacks S&P 500 composite’s rally of 3.7%.
Solid Rank & VGM Score: MAXIMUS has a Zacks Rank #2 (Buy). Our research shows that stocks with a Zacks Rank #1 (Strong Buy) or #2 offer attractive investment opportunities for investors. You can see the complete list of today’s Zacks #1 Rank stocks here.
Northward Estimate Revisions: One estimate for fiscal 2019 moved north in the past 60 days versus no downward revision, reflecting analysts’ confidence in the company. Over the same period, the Zacks Consensus Estimate for fiscal 2019 inched up 0.5%.
Positive Earnings Surprise History: MAXIMUS has an impressive earnings surprise history. The company outpaced the consensus mark in two of the trailing three quarters and matched estimates in one. Its average four-quarter positive earnings surprise is 4.4%.
Strong Growth Prospects:The Zacks Consensus Estimate for fiscal 2019 earnings is currently pegged at $3.66, reflecting year-over-year growth of 7.7%. Moreover, earnings are expected to register 12.6% growth in fiscal 2020. The stock has long-term expected earnings per share (EPS) growth rate of 10%.
Growth Drivers: MAXIMUS has emerged as one of the leading providers of BPS, technology solutions and consulting services to government health and human services agencies globally. The ability to deliver cost effective, efficient and high-scale solutions ensure a competitive position for MAXIMUS.
Maximus, Inc. Revenue (TTM)
The company is progressing well with digital transformation strategies. It is developing new solution sets through techniques such as cloud migration services, artificial intelligence, robotic process automation, (RPA) and machine learning. It is implementing new digital innovations within both business process management and as direct service offerings to enhance the portfolio of citizen services and federal capabilities. It is actively involved with many state clients to discover how digital initiatives can improve user experience for programs like Medicaid. Digital initiatives are helping MAXIMUS broaden its BPO business.
In 2018, MAXIMUS acquired General Dynamics Information Technology's citizen engagement centers to strengthen its U.S. federal services. The acquisition brought in additional cost-plus contracts, enhanced technology and added operational capabilities. The company expects $600-$625 million revenue contribution from this buyout in fiscal 2019.
Zacks Rank & Stocks to Consider
Some other top-ranked stocks in the broader Zacks Business Services sector are Insperity (NSP - Free Report) , Copart (CPRT - Free Report) and Automatic Data Processing (ADP - Free Report) .
While Insperity sports a Zacks Rank #1, Copart and Automatic Data Processing carry a Zacks Rank #2. Long-term expected EPS (three to five years) growth rate for Insperity, Copart and Automatic Data Processing and is 18%, 20% and 13%, respectively.
Zacks Editor-in-Chief Goes "All In" on This Stock
Full disclosure, Kevin Matras now has more of his own money in one particular stock than in any other. He believes in its short-term profit potential and also in its prospects to more than double by 2019. Today he reveals and explains his surprising move in a new Special Report.
Download it free >>