NV5 (NVEE) versus Performant Financial (NASDAQ:PFMT) Critical Survey

NV5 (NASDAQ: NVEE) and Performant Financial (NASDAQ:PFMT) are both small-cap business services companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, risk, profitability, institutional ownership, valuation and earnings.

Profitability

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This table compares NV5 and Performant Financial’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NV5 7.21% 15.89% 9.18%
Performant Financial -9.64% -11.97% -5.75%

Insider & Institutional Ownership

56.2% of NV5 shares are held by institutional investors. Comparatively, 58.5% of Performant Financial shares are held by institutional investors. 26.0% of NV5 shares are held by company insiders. Comparatively, 33.6% of Performant Financial shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares NV5 and Performant Financial’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
NV5 $333.03 million 1.94 $24.00 million $2.38 25.02
Performant Financial $132.05 million 1.15 -$12.72 million ($0.19) -15.53

NV5 has higher revenue and earnings than Performant Financial. Performant Financial is trading at a lower price-to-earnings ratio than NV5, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

NV5 has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500. Comparatively, Performant Financial has a beta of 1.16, meaning that its stock price is 16% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings for NV5 and Performant Financial, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NV5 0 1 3 0 2.75
Performant Financial 0 0 1 0 3.00

NV5 currently has a consensus target price of $58.00, indicating a potential downside of 2.60%. Performant Financial has a consensus target price of $3.50, indicating a potential upside of 18.64%. Given Performant Financial’s stronger consensus rating and higher probable upside, analysts plainly believe Performant Financial is more favorable than NV5.

Summary

NV5 beats Performant Financial on 9 of the 14 factors compared between the two stocks.

About NV5

NV5 Global, Inc. provides professional and technical engineering and consulting services to public and private sector clients in the infrastructure, energy, construction, real estate, and environmental markets in the United States and internationally. It operates through two segments, Infrastructure; and Building, Technology & Sciences. The company offers site selection and planning, design, water resources, transportation, structural engineering, land development, surveying, power delivery, building code compliance, and other services; and construction materials testing and engineering, geotechnical engineering and consulting, and forensic consulting services. It also provides governmental outsourcing and consulting, and technical outsourcing services, as well as building program management services. In addition, the company offers mechanical, electrical, and plumbing design services; commissioning services; energy performance, management, and optimization services; acoustical design consulting services; and audiovisual?security and surveillance?information technology?data center services, as well as energy services. Further, it provides various services, such as investigating and analyzing environmental conditions, and recommending corrective measures and procedures; occupational health and safety services; hydrogeological modeling and environmental programs; water resource planning, monitoring, and environmental management of wastewater facilities; solid waste landfill investigations; permitting and compliance; storm water pollution; environmental impact statement support; agricultural waste management and permitting; and wetland evaluations. The company was formerly known as NV5 Holdings, Inc. and changed its name to NV5 Global, Inc. in December 2015. NV5 Global, Inc. was founded in 1949 and is headquartered in Hollywood, Florida.

About Performant Financial

Performant Financial Corporation provides technology-enabled audit, recovery, customer care, and related analytics services in the United States. The company offers recovery services primarily to the government-supported student loan industry, serving guaranty agencies, the Department of Education, and private financial institutions; and restructures and recovers student loans issued directly by banks to students outside of federal lending programs. It also provides audit and recovery services related to improper payments in the healthcare market; and recovery and risk management advisory services to the Department of the Treasury and various financial institutions, as well as to several federal, state, and municipal tax authorities. In addition, the company offers services from post-and pre-payment audit of healthcare claims to detection of fraud, waste and abuse of healthcare claims, to coordination of benefits and pharmacy fraud detection. The company was formerly known as DCS Holdings, Inc. and changed its name to Performant Financial Corporation in 2005. Performant Financial Corporation was founded in 1976 and is headquartered in Livermore, California.

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