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Why Investors Should Retain FTI Consulting (FCN) Stock Now

Shares of FTI Consulting, Inc. FCN have gained 19% over the past year against the 17.7% decline of the industry it belongs to. FCN’s revenues are anticipated to grow 8.2% and 9% in 2022 and 2023, respectively.


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Factors That Augur Well

FTI Consulting's current ratio (a measure of liquidity) stood at 2.26 at the end of second-quarter 2022, higher than the 2.16 recorded at the end of the prior-year quarter. A higher current ratio bodes well for FTI Consulting. Moreover, a current ratio of more than 1.5 is usually considered favorable for a company. This may imply that the risk of default is less.

FCN has a unique potential to bring together diverse issues like damage assessment, accounting, economics, finance and the industry on a single platform. This makes it an excellent partner for global clients, generating continued revenue growth from the existing international operations.

FTI Consulting has a consistent track record of share repurchases. In 2021, 2020 and 2019, FCN repurchased shares worth $46.1 million, $353.4 million and $105.9 million. These initiatives not only instill investors’ confidence in the stock but also boost the earnings per share.

Some Risks

FTI Consulting makes most of its investments in hiring qualified professionals as well as promoting and training individuals. Such investments are necessary to enhance growth and are likely to benefit FCN in the long term. However, escalating investments in people are likely to weigh on the bottom line in initial stages.

Zacks Rank and Stocks to Consider

FTI Consulting currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the broader Zacks  Business Services  sector are Avis Budget Group, Inc. CAR, Automatic Data Processing, Inc. ADP  and  CRA International, Inc. CRAI.

Avis Budget  sports a Zacks Rank #1 at present. CAR has an earnings growth rate of 108.4% for 2022.

Avis Budget delivered a trailing four-quarter earnings surprise of 69.5%, on average.

ADP  carries a Zacks Rank #2 (Buy) at present. ADP has a long-term earnings growth expectation of 12%.

ADP delivered a trailing four-quarter earnings surprise of 5%, on average.

CRA International  carries a Zacks Rank of 2, currently. CRAI has a long-term earnings growth expectation of 14.3%.

CRAI delivered a trailing four-quarter earnings surprise of 26%, on average.
 


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