Maximus, Inc.’s. MMS continued efforts to expand business processes and grow client relationships through strategic acquisitions are praiseworthy. The acquisitions enable the company to gain improved technical and additional skills.
Maximus, Inc. reported mixed second-quarter fiscal 2023 results wherein earnings missed the Zacks Consensus Estimate but revenues beat the same. Quarterly adjusted earnings (excluding 28 cents from non-recurring items) of 80 cents per share missed the Zacks Consensus Estimate by 2.6% and decreased 25.2% year over year. Revenues of $1.21 billion beat the consensus mark by 1.3%. The figure increased 2.5% year over year.
Maximus has outperformed its industry in the past year, growing 23.8% compared with its industry’s14.4% increase.
Maximus, Inc. Price
Maximus, Inc. price | Maximus, Inc. Quote
Current Situation of Maximus
Maximus is benefiting from its strong government relationship. The company has been providing cost-effective, efficient and high-scale solutions and has established itself one of the government’s lucrative partners. Maximus aims at gaining a stronghold in clinical services as well as long-term services and support. The company aims to do so by forming long-term relationships with clients in both existing and adjacent markets.
Maximus’ diligent acquisition strategy enables growth. Strategic acquisitions also complement the company’s long-term organic growth strategy. The 2021 acquisition of Connect Assist fortified Maximus’ customer service and digital capabilities. Another acquisition, VES, fast-tracked the company’s clinical evolution.
The company’s regular dividend payment history instills confidence in investors. During fiscal 2022, 2021 and 2020, Maximus paid cash dividends of $68.7 million, $68.8 million and $70.2 million, respectively.
Maximus’ current ratio at the end of second-quarter fiscal 2023 was pegged at 1.4, lower than the current ratio of 1.45 reported at the end of the prior-year quarter. This indicates that the company may have problems meeting its short-term debt obligations.
Zacks Rank and Other Stocks to Consider
MMS currently carries a Zacks Rank #2 (Buy). Investors interested in the Zacks Business Services sector can also consider the following stocks:
Green Dot GDOT: For second-quarter 2023, the Zacks Consensus Estimate of Green Dot’s revenues suggests a decline of 4.5% year over year to $339.2 million and the same for earnings indicates a 56.8% plunge to 32 cents per share. The company has an impressive earning surprise history, beating the consensus mark in all four trailing quarters, the average surprise being 37.3%.
GDOT has a Value score of A and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Rollins ROL: For second-quarter 2023, the Zacks Consensus Estimate of Rollins’ revenues suggests growth of 12.8% year over year to $805.2 million and the same for earnings indicates a 15% increase to 23 cents per share. The company has an impressive earning surprise history, beating the consensus mark in three of the four trailing quarters and missing on one instance. The average surprise was 5.53%.
ROL currently sports a Zacks Rank of 1.
Omnicom Group OMC: For second-quarter 2023, the Zacks Consensus Estimate of Omnicom’s revenues suggests growth of 1.6% year over year to $3.63 billion and the same for earnings indicates a 6.6% increase to $1.79 per share. The company has an impressive earning surprise history, beating the consensus mark in all four trailing quarters with the average surprise being 9.1%.
OMC currently carries a Zacks Rank of 2.
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