Trump announces trade deal with EU following months of negotiations
On Thursday, DA Davidson announced a revision in the price target for Bowman Consulting Group Ltd. (NASDAQ:BWMN), lowering it to $32.00 from the previous $34.00, but still maintains a Buy rating on the company’s shares. According to InvestingPro data, the stock appears undervalued despite trading at high multiples, with analyst targets ranging from $28 to $43. The adjustment reflects a response to broader market shifts, specifically a compression in industry multiples, which influenced the firm’s valuation benchmarks.
The analyst from DA Davidson, Brent Thielman, noted that Bowman’s commitment to achieving its organic growth and margin expansion goals is expected to drive higher share values, despite the reduced price target. The company has demonstrated strong execution with impressive gross profit margins of 52.23% and robust revenue growth of 23.19% over the last twelve months. Thielman’s evaluation is based on a multiple of 9x and 8x the company’s estimated EBITDA for the years 2025 and 2026, respectively. These estimates remain largely unchanged, but the price target has been adjusted to account for recent trends in industry valuations.
Bowman’s performance in the fourth quarter was marked by significant margin expansion, improved cash flow, and a growing backlog, which positions the company well as it enters 2025. The momentum seems to be continuing into the first quarter, with strong bookings reported. Although Bowman has slowed down its mergers and acquisitions (M&A) activities recently, completing only two deals since the end of September, the company’s liquidity remains robust, enabling it to pursue further transactions. Additionally, Bowman has been actively repurchasing shares after the end of the fiscal year.
Thielman indicated that M&A is a core aspect of Bowman’s growth strategy. However, there is an expectation that the company may currently benefit more from focusing on organic growth and margin expansion, which could potentially lead to greater accretion to its multiple in the near term. This strategic shift appears to be in line with the company’s objectives and is anticipated to support the enhancement of shareholder value.
In other recent news, Bowman Consulting Group Ltd reported impressive financial results for the fourth quarter of 2024, surpassing market expectations. The company announced an earnings per share of $0.33, exceeding the forecasted $0.24, while its revenue reached $98.6 million, beating the anticipated $97.85 million. Additionally, Bowman Consulting’s gross revenue for the full year 2024 was reported at $426.6 million, marking a 23% increase from the previous year. The company highlighted its strategic acquisitions and technology investments as key factors contributing to its strong performance. Looking ahead to 2025, Bowman Consulting projects net revenues between $428 million and $440 million and adjusted EBITDA between $70 million and $76 million. The firm plans to continue its focus on mergers and acquisitions, as well as technology investments, to sustain its growth trajectory. Analyst firm Craig Hallum noted Bowman’s strong new order flow and its strategy to expand in data center and infrastructure markets. Bowman Consulting’s management expressed confidence in maintaining a positive growth profile through strategic acquisitions and integration.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.