NV5 Holdings Receives Buy Rating from Lake Street Capital Markets with $165 Price Target
Lake Street Capital Markets has reiterated its Buy rating for NV5 Holdings (NASDAQ: NVEE) with a price target of $165.00. The firm praised NV5's second-quarter performance, which met expectations, and highlighted an improved revenue outlook indicating growth in the latter part of the year. NV5 showed a 4% organic growth for the quarter and a 7% year-to-date increase.
The firm noted positive trends in federal spending, particularly benefiting NV5's geospatial segment. NV5 operates in promising growth markets and is expected to capitalize on industry tailwinds such as data center construction, electrical grid reinforcement, and infrastructure investment.
Lake Street Capital Markets predicts that NV5 is on track to achieve a significant milestone of reaching a $1 billion revenue run rate by the end of 2024. Analysts also project that NV5 could set a new revenue target of over $1.5 billion by 2028, based on estimated 7% organic revenue growth and $200 million from acquisitions.
The firm believes that NV5's stock could potentially reach $300 per share if the company trades at multiples similar to its peers. As NV5 progresses towards its long-term goals, this growth is expected to drive the company's stock performance into 2025.
In recent news, NV5 Global, Inc. secured a $290 million contract with the National Geospatial-Intelligence Agency, expected to generate around $30 million in revenue for NV5 over five years. NV5 reported a successful second quarter in 2024, with its backlog expanding to $877 million and revised full-year revenue guidance to between $944 million and $950 million.
Analysis:
NV5 Holdings has received a positive outlook from analysts at Lake Street Capital Markets, with expectations of significant revenue growth in the coming years. The company's focus on promising growth markets and strategic acquisitions positions it well for achieving its long-term revenue targets. Investors may see potential in NV5's stock as it continues to advance towards its milestones. However, it's important to consider the company's high earnings multiple and lack of dividend payments when making investment decisions. For a more detailed analysis, investors can explore additional insights on InvestingPro's platform.