Subscribe to Entrepreneur for $5

Here's Why You Should Hold on to Envestnet (ENV) Stock For Now

Envestnet's (ENV) business model ensures solid asset-based and subscription-based recurring revenue generation capacity.

This story originally appeared on Zacks

Envestnet, Inc. ENV has an impressive Growth Score of A. This style score condenses all the essential metrics from a company’s financial statements to get a true sense of the quality and sustainability of its growth. Envestnet’s revenues are expected to register 17.2% growth in 2021 and 12.7% in 2022.

- Zacks

Factors That Bode Well

Envestnet’s business model ensures solid asset-based and subscription-based recurring revenue generation capacity. Asset-based recurring revenues of $170 million increased 39% and subscription-based recurring revenues of $113 million were up 7% in the second quarter of 2021.

The company’s technology-enabled services are expected to register handsome growth as trends such as increasing demand for personalized wealth management services and guided advice in a cost-effective manner are creating significant market opportunities.

Envestnet continues to focus on technology development to improve operational efficiency, increase market competitiveness, address regulatory demands and cater to client-driven requests for new capabilities. The company’s technology design facilitates significant scalability.

Debt Woe Stays

Envestnet's total debt to total capital ratio of 0.48 at the end of the second quarter of 2021 was higher than the industry’s 0.37. A higher debt, as a percentage of total capital, indicates a higher risk of insolvency.

Envestnet's cash and cash equivalent balance of $370 million at the end of the quarter was well below the long-term debt level of $846 million. This underscores that the company doesn’t have enough cash to meet this debt burden.

Zacks Rank and Stocks to Consider

Envestnet currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Zacks Business Services sector are ManpowerGroup MAN, Cross Country Healthcare CCRN and Genpact G, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The long-term expected earnings per share (three to five years) growth rate for ManpowerGroup, Cross Country Healthcare and Genpact is pegged at 24.2%, 9.9% and 14.7%, respectively.

Time to Invest in Legal Marijuana

If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.

After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%.

You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.

Today, Download Marijuana Moneymakers FREE >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report


ManpowerGroup Inc. (MAN): Free Stock Analysis Report


Genpact Limited (G): Free Stock Analysis Report


Envestnet, Inc (ENV): Free Stock Analysis Report


Cross Country Healthcare, Inc. (CCRN): Free Stock Analysis Report


To read this article on click here.


Zacks Investment Research