NV5 Global, Inc. (NVEE) provides technical engineering and consulting services to public and private sector clients in the infrastructure, utility services, construction, real estate, and environmental markets.

It operates through three segments: Infrastructure; Building, Technology & Sciences; and Geospatial Solutions. The company is an extensive infrastructure player.

American infrastructure is vast and constantly expanding. According to the American Society of Engineers, it gave America a C in its latest report. According to the American Society of Engineers, it is expected that major problems will need to be addressed with a spending plan totaling at least $2.6 trillion.

New American Rescue Plan grants hundreds of billions to the states and cities to help them fill their budget gaps, including infrastructure spending.

Additionally, the bipartisan bill for infrastructure has been passed by the divided Senate and will be up for vote in the House on September 27, This bill, if passed, would bring in $1.2 trillion of funding. NV5 would receive a large portion.

NV5 Global thrived even without the bills. The federal investment will ensure that NV5 Global has a bright future.

I believe in NVEE stock. (See NV5 Holdings stock charts on TipRanks)

Positive Metrics Before Stimulus Funding Boost

NV5 Global posted tremendous EPS growth during the first six months of 2021.

The diluted EPS rose 96% to $1.35 per shares, year-over-year. The operating income increased 38% from $20.3 million to $28.1million, and was $2.35 per share.

Revenue has grown at an average annual growth rate 26% in the last decade. From $63.4million in 2011, it rose to more than $659,000,000 in fiscal 2020.

NVEE shares have a very low float. There were $14.2 million worth of diluted shares remaining as of July 3, 2021. Even small gains on a share basis can still be significant.

Savvy Acquisition Already Paying Off

Much of the revenue growth has come from the company’s Geospatial Division, which was created when the company acquired Quantum (NASDAQ:) Spatial during fiscal 2019.

It cost $318 million. The segment already has $148.9million in revenue and $30 million in income after taxes in fiscal 2020.

In order to offer geospatial services, the U.S. Geological Survey (USGS), awarded the company a contract of up to $850m. This contract will last for five years and is similar to a deal where NV5 was awarded $135 million in five-years of USGS work.

Wall Street’s Take

Wall Street analysts are neutral on NVEE stock, with a Moderate Buy rating, based on one Buy and one Hold. An average NVEE price target $115 suggests 11.5% upside potential at current trading levels.

Summary on NV5 Global

NV5 Global has been thriving and growing for the past several years, and has been net profitable for a decade.

The recent acquisitions made by the management were very successful and should continue to perform well. The need to improve the infrastructure’s current condition and provide secular tailwinds which should be sustainable for the near future.

NV5 Global capitalizes on the opportunities. Stock investors should be more attentive to this stock.

Disclosure: Bradley Guichard held shares in NVEE at the time this article was published.

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