There are plenty of opportunities for investors to get alpha in the market. But at the same time, it’s not an easy field to navigate. It can be challenging to find the right stocks at the right time. Since the Great Recession, professional services firms have been among the fastest-growing businesses in almost every industry worldwide. There are several great investment opportunities among these stocks, but with so many different subsectors and niches within that category, it can be challenging to know which one to choose. This is especially true since some market segments get much more attention than others. That being said, here’s why buying stocks in the professional services sector makes sense right now and why we think these firms will continue growing moving forward.
Equifax is a massive financial advisor that earns most of its revenue from credit reporting services and data management. While the company is most famous for its massive data breach in 2017 and subsequent cover-up, it’s important to remember that they’re still a solid business. The breach was an unfortunate event that could happen to any company, and most credit reporting operations were unaffected. Moreover, despite the PR nightmare and the subsequent investigation, the company saw record profits in 2018 and has a strong track record of growth.
Huron Consulting Group (HURN)
Huron Consulting is among the world’s largest providers of management consulting services. They specialize in advising companies on operations and strategy but also dabble in other fields such as marketing, IT, and the procurement of goods and services. With over a century of experience, Huron Consulting has a massive global footprint and is currently operating in over 100 countries around the globe. One of the most significant advantages of this company is that it’s not reliant on any industry or region. Instead, it has a very diversified customer base that spans all sectors. This is a crucial advantage since the company will continue to see strong sales even in a down market.
Exponent is one of the world’s most significant independent engineering and scientific consulting firms. Unlike its competitors, it doesn’t have a specific focus on a particular niche. Instead, it provides a wide range of services to a wide range of clients. This company has become a significant player in the scientific research field. It has earned a reputation as a leader in scientific investigations and forensic sciences. Exponent also provides engineering consulting services as well as specialized healthcare consulting.
Clarivate is one of the most significant information services companies in the world. It provides a wide range of products and services to businesses of all types, including customers in the professional services sector. It currently has a market cap of $19 billion. However, the company is most famous for its academic and scientific research platform. This is the world’s largest database of peer-reviewed research articles, with more than 2 million new articles added every month.
These stocks are poised to fare well in the coming years. All have substantial competitive advantages, are well-positioned for growth, and are likely to see significant earnings increases in the coming years. So while the professional services industry has struggled over the last decade, there’s plenty of reason to be bullish about it in the years ahead. If you’re looking for high-quality stocks with solid fundamentals, these are four great options to consider buying in the next couple of years.