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Alberto Abaterusso
Alberto Abaterusso
Articles (2470) 

A Trio of Rapidly Growing Small Caps

TTEC Holdings Inc tops the list

January 29, 2020 | About:

Pushed by the ongoing expansion of the U.S. economy, with gross domestic product expected to have hit a 2% annualized gain in the final quarter of 2019, the Russell 2000 Index climbed 13% to $1,658.31 per share over the past year through Tuesday, Jan. 28. The Russell 2000 is used as a benchmark for small-cap U.S.-listed companies, which have a market capitalization ranging between $300 million and $2 billion.

For 2020, the share prices of U.S.-listed small caps will likely continue to increase with their earnings due to increased consumer spending.

Thus, investors may want to consider the following small caps, which posted a robust rise in their last 12-month earnings per share without non-recurring items of 25% or more.

TTEC Holdings

The first company that meets the above-listed criteria is TTEC Holdings Inc (NASDAQ:TTEC), an Englewood, Colorado-based customer experience technology and services company with a market capitalization of around $1.92 billion.

TTEC has grown its trailing 12-month earnings per share without non-recurring items by 381.3%, pushing the share price higher 25% over the past year. The stock was trading at a price of $41.10 per share on Wednesday, below the 200- and 100- day simple moving average lines but above the 50-day simple moving average line.

The stock has a price-earnings ratio of 27.64 versus the industry median of 26.51 and a price-sales ratio of 1.19 versus the industry median of 2.26.

For 2020 and the next five years, Wall Street analysts forecast annual EPS growth of 9.60% and 11.25%, respectively. Six sell-side analysts issued a buy rating, while one sell-side analyst suggests holding shares of TTEC Holdings Inc. The average target price is $54.17 per share.

GuruFocus assigned a positive financial strength rating of 6 out of 10 and a high profitability rating of 8 out of 10 to the company.

TTEC Holdings Inc currently pays a semi-annual dividend of 32 cents per common share.

Spirent Communications

The second company that meets the above-listed criteria is Spirent Communications PLC ADR (SPMYY), a British provider of solutions to develop devices and equipment and to operate networks worldwide. Its stock has a market capitalization of about $1.86 billion.

Spirent Communications reported 89.5% growth in its trailing 12-month earnings per share without non-recurring items. On the tailwinds of this, the stock has risen 54% in the past year to trade above the 200-, 100- and 50-day simple moving average lines. The share price was trading at $12.20 on Wednesday.

For 2020 and 2021, analysts forecast nearly EPS growth of 40% and about 47.2%, respectively. Wall Street sell-side analysts recommend a hold rating for this stock with an average target price of $11.70.

GuruFocus assigned a high rating of 8 out of 10 for the company’s financial strength and its profitability.

Spirent Communications PLC pays a semi-annual dividend of 7.8 cents per common share.

Kadant

The third company that meets the above-listed criteria is Kadant Inc (NYSE:KAI), a Westford, Massachusetts-based supplier of equipment and critical components that are used in industrial processes such as papermaking, paper recycling, recycling and waste management. The stock has a market capitalization of approximately $1.22 billion.

Kadant has grown its trailing 12-month earnings per share without non-recurring items by 92.7%. As a result, the share price rose 28% in the past year to above the 200-, 100- and 50-day simple moving average lines. The share price was trading at $108.80 on Wednesday.

The stock has a price-earnings ratio of 20.16 versus the industry median of 18.52 and a price-sales ratio of 1.81 compared to the industry median of 1.05.

For 2020 and the following five years, sell-side analysts predict that Kadant Inc will increase its annual EPS by 11.6% and by 8%, respectively. Three sell-side analysts have issued recommendation ratings on shares of Kadant Inc, consisting of a strong buy, a buy and a hold rating with an average price target of $106.33 per share.

GuruFocus assigned a moderate financial strength rating of 5 out of 10 and a high profitability rating of 8 out of 10 to the company.

Kadant Inc currently pays a quarterly dividend of 23 cents per common share.

Disclosure: I have no positions in any securities mentioned.

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About the author:

Alberto Abaterusso
I am a contributor at GuruFocus. I primarily write about how to pick potential value stocks. Gold, silver and precious metals mining industries is also my cup of tea. My articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. I hold a Master\\\'s Degree in Business Administration from Università degli Studi di Bari (Italy), Aldo Moro. I am based in The Netherlands.

You can follow me on Twitter at https://twitter.com/AAbaterusso

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