Core Insights - NV5 has completed the acquisition of Herman Cx, enhancing its capabilities in commissioning and conformity assessment services for hyperscale data centers [1][2] - The acquisition is expected to be immediately accretive to NV5's earnings and is part of the company's strategy to grow its domestic data center business [1][2] Company Overview - NV5 Global, Inc. provides technology, certification, and consulting solutions across various sectors, focusing on utility services, infrastructure engineering, construction quality assurance, buildings & technology, environmental health sciences, and geospatial services [5] - The company operates from over 100 offices nationwide and internationally [5] Acquisition Details - Herman Cx specializes in QA/QC support and commissioning services for mission-critical data centers, with over 90 years of combined employee experience in the sector [4] - The acquisition was executed through a combination of cash and stock [1] - Herman Cx has commissioned data center infrastructure up to 175 megawatts and offers comprehensive mission-critical testing and commissioning services [2][4] Strategic Growth - Data centers are a significant growth driver for NV5, contributing over 20% organic growth [3] - The acquisition is expected to create cross-selling opportunities for NV5's existing services, including MEP-technology design, fire protection, and power delivery [2][3]

Core Insights - NV5 Global, Inc. has been awarded $18 million in data center design and commissioning contracts in the U.S. and Asia, enhancing its leadership in the expanding data center sector [1][2] - The company will provide high-efficiency cooling and power distribution solutions, addressing the increasing demands from AI workloads and cloud computing [2][3] - NV5 has surpassed one gigawatt (GW) in global data center systems design and commissioning, showcasing its expertise in energy-efficiency solutions and innovative cooling technologies [3] Company Overview - NV5 Global, Inc. offers technology, certification, and consulting solutions for both public and private sector clients, focusing on utility, infrastructure, and building assets [4] - The company operates in six business verticals: Utility services, infrastructure support, conformity assessment, buildings & technology, environmental health sciences, and geospatial services [4] - NV5 has a presence in over 100 offices both domestically and internationally [4]

Core Insights - NV5 Global, Inc. has been awarded a five-year contract worth $5 million by the Florida Department of Transportation (FDOT) to provide geotechnical engineering and construction materials testing for Florida's Turnpike Enterprise [1][2][3] - The contract aims to support infrastructure development, asset management, and maintenance across a critical 260-mile transportation network that serves over three million travelers daily [1][2] - NV5's laboratories in Miami, Orlando, and Gainesville will conduct essential services such as soil exploration, construction materials sampling, and pavement evaluation to ensure the safety and performance of the Turnpike system [2][3] Company Overview - NV5 Global, Inc. specializes in technology, certification, and consulting solutions for both public and private sector clients, focusing on utility, infrastructure, and building assets [4] - The company operates in six business verticals: Utility services, infrastructure support, conformity assessment, buildings & technology, environmental health sciences, and geospatial services [4] - NV5 has over 100 offices nationwide and abroad, indicating a strong operational presence [4]

Core Insights - NV5 Global, Inc. has secured over 250 megawatts (MW) of data center projects in Thailand, enhancing its role in large-scale data center infrastructure expansion [1] - The company has been awarded a $6 million project for commissioning a hyperscale data center for a U.S. technology company, which includes testing advanced cooling and ventilation systems [1] - Thailand's digital economy is projected to exceed $50 billion in 2025, driven by a skilled workforce and significant government investment in digital infrastructure, making it an attractive market for hyperscalers [2] Company Overview - NV5 Global, Inc. provides technology, certification, and consulting solutions across six business verticals: utility services, infrastructure support, conformity assessment, buildings & technology, environmental, and geospatial services [4] - The company operates from over 100 offices both domestically and internationally, positioning itself as a trusted advisor in the global data center growth [2][4] Market Position - NV5's expertise in recurring commissioning and data center design is crucial for clients looking to establish and scale operations in Thailand [3] - The company has received multiple project awards, including technical due diligence and design for large-scale data centers, indicating strong growth opportunities in the region [3]

Core Viewpoint - NV5 Global (NVEE) shows potential for significant upside, with a mean price target of $25.25 indicating a 36.7% increase from the current price of $18.47 [1] Price Targets - The average price target consists of four estimates ranging from a low of $22 to a high of $28, with a standard deviation of $2.75, suggesting a variability in analyst estimates [2] - The lowest estimate indicates a 19.1% increase, while the highest suggests a 51.6% upside [2] Analyst Sentiment - Analysts are increasingly optimistic about NVEE's earnings prospects, as evidenced by a strong consensus in revising EPS estimates higher, which correlates with potential stock price movements [9] - Over the last 30 days, two estimates have been revised upward, leading to a 5.2% increase in the Zacks Consensus Estimate [10] Zacks Rank - NVEE holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate factors, indicating strong potential for near-term upside [11] Price Target Reliability - While consensus price targets are often sought after, they may not reliably indicate actual stock price movements, and should be approached with skepticism [5][8]

Core Insights - NV5 Global (NVEE) is currently viewed as a stronger investment option compared to Amplitude, Inc. (AMPL) for value investors seeking undervalued stocks [1][3][7] Valuation Metrics - NVEE has a forward P/E ratio of 13.91, significantly lower than AMPL's forward P/E of 166.96, indicating NVEE may be undervalued [5] - The PEG ratio for NVEE is 2.64, while AMPL's PEG ratio stands at 4.32, suggesting NVEE has a more favorable growth outlook relative to its valuation [5] - NVEE's P/B ratio is 1.42, compared to AMPL's P/B of 4.08, further supporting the notion that NVEE is undervalued [6] Earnings Outlook - NVEE is experiencing an improving earnings outlook, which enhances its attractiveness in the Zacks Rank model [7]

Revenue Sources - For fiscal years 2024, 2023, and 2022, approximately 63%, 68%, and 64% of NV5 Global's gross revenues were derived from public and quasi-public sector clients[34]. - Public and quasi-public sector clients represented approximately 63%, 68%, and 64% of gross revenues in 2024, 2023, and 2022, respectively[72]. - The company anticipates continued revenue growth from public and quasi-public sector clients, which historically show resilience during economic downturns[200]. Client Base and Market Engagement - The company serves approximately 11,300 clients, with the ten largest clients accounting for about 25% of gross revenues for the year ended December 28, 2024[72]. - The ten largest clients accounted for approximately 25% of gross revenues during the fiscal year ended December 28, 2024, indicating a concentration risk[118]. - Approximately 28% of gross revenues in fiscal years 2024, 2023, and 2022 came from California-based projects, indicating a significant reliance on this region[110]. Organizational Structure and Employee Expertise - NV5 Global operates over 100 locations in the U.S. and abroad, enhancing local market expertise and client engagement[28]. - NV5 Global's organizational structure promotes client service through a flat model, ensuring access to qualified professionals across service verticals[27]. - NV5 Global's experienced employees average over 20 years in the engineering and consulting industry, emphasizing the importance of human capital[31]. - The company had 5,024 employees as of December 28, 2024, including 4,714 full-time employees[81]. Service Segments - The Infrastructure segment includes engineering, civil program management, utility services, and conformity assessment practices[37]. - The Building, Technology & Sciences segment encompasses clean energy consulting, data center commissioning, and environmental health sciences[37]. - The Geospatial Solutions segment focuses on geospatial practices, enhancing the company's service capabilities[38]. Growth Strategy and Acquisitions - The company aims to pursue strategic acquisitions to expand service offerings and geographic footprint, focusing on tech-enabled solutions with high profitability[36]. - The company maintains a full-time M&A initiative focused on identifying acquisition targets and enhancing existing service offerings[70]. - The company’s growth strategy includes acquisitions, which could disrupt operations and impact business results if not successfully integrated[151]. - The company faces challenges in identifying suitable acquisition candidates and may not be able to acquire additional companies on acceptable terms[154]. - Future acquisitions may not perform as expected, potentially failing to realize anticipated revenue and profits[156]. Financial Performance - Gross revenues for fiscal year 2024 reached $941,265,000, a 9.8% increase from $857,155,000 in 2023[194]. - Net income for fiscal year 2024 was $27,979,000, down 36% from $43,724,000 in 2023[194]. - Total assets increased to $1,315,356,000 in 2024, up from $1,184,195,000 in 2023, representing an 11.1% growth[196]. - Total equity rose to $833,014,000 in 2024, compared to $774,906,000 in 2023, marking a 7.4% increase[196]. - Operating expenses for 2024 totaled $439,799,000, a 20% increase from $366,273,000 in 2023[194]. - Basic earnings per share decreased to $0.45 in 2024 from $0.72 in 2023, reflecting a 37.5% decline[194]. Risk Factors - The company relies on a limited number of clients for a significant portion of its business, which poses a risk if contracts are not renewed[100]. - Economic downturns and budget constraints faced by state and local governments may lead to project delays or cancellations, adversely affecting financial results[106]. - A delay in the U.S. government's budget process could negatively impact future revenue due to potential procurement delays[107]. - The competitive landscape is highly fragmented, with numerous competitors, which may force the company to make price concessions and affect profitability[119]. - The company faces risks related to cybersecurity breaches, which could adversely impact operations and financial condition[143]. Compliance and Regulatory Issues - The company is subject to various regulatory compliance requirements, including procurement laws and environmental regulations[93]. - Compliance with various procurement laws and regulations is critical, as violations could lead to sanctions and loss of government contractor status[158]. - Regulatory compliance related to data privacy and security is essential, with potential fines and penalties for non-compliance[167]. - The company may face liabilities under environmental laws, which could result in substantial costs and impact financial performance[162]. Sustainability and Corporate Governance - The company is committed to sustainability, focusing on greenhouse gas emissions reduction and expanding its subscription-based energy efficiency services[80]. - Executive Chairman Mr. Dickerson Wright owns approximately 10.7% of the common stock, giving him significant influence over corporate decisions[173]. - The company does not currently pay dividends and does not intend to do so in the foreseeable future[104]. - The company has anti-takeover provisions that may deter acquisition attempts and affect stockholder participation in such proposals[174].

Financial Data and Key Metrics Changes - Organic growth increased over 100% to 6% of revenues, with total revenues growing from $857 million in 2023 to $941 million in 2024, a 10% increase [10] - Adjusted EBITDA grew from $134 million in 2023 to $143 million in 2024, representing a 7% increase [10] - Gross margins improved from 49.7% in 2023 to 51.3% in 2024 [10] - For Q4 2024, gross revenue increased by 15% to $246.5 million compared to $214.9 million in Q4 2023 [19] - Net income for Q4 2024 was $5.4 million, down from $10.1 million in Q4 2023, with GAAP diluted EPS at $0.09 compared to $0.16 in the prior year [20][21] - Full year 2024 net income was $28 million, down from $43.7 million in 2023, with GAAP diluted EPS at $0.44 compared to $0.71 in the prior year [23] Business Line Data and Key Metrics Changes - Infrastructure Support segment generated $111 million in revenue in Q4, driven by strong demand in Utility Services [34] - Geospatial segment recognized $69 million in revenue in Q4, with 50% from federal government contracts [41] - Buildings and Technology segment saw growth in data center systems and clean energy initiatives, now comprising 15% of the portfolio [37] Market Data and Key Metrics Changes - The backlog entering 2025 was $904 million, an 8% increase from the previous year, representing over 80% of the revenue guidance for 2025 [15][84] - The company is experiencing strong demand in utilities, data centers, and digital transformation sectors [16] Company Strategy and Development Direction - The company aims for a revenue target of $1.6 billion by the end of 2028, focusing on organic growth and strategic acquisitions [12][61] - Initiatives to improve EBITDA margins by 150 basis points in 2025 through cost optimization and increased utilization [27][63] - The company is leveraging technology to enhance service delivery and expand client relationships, particularly in recurring OpEx services [58] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving mid to high-single-digit organic growth in 2025, supported by a strong backlog [63][84] - The company is optimistic about growth opportunities in geospatial technology and utility services, with a focus on expanding cash flows and operating margins [16][61] Other Important Information - The company has implemented initiatives to improve cash flow conversion rates, targeting a 60% free cash flow conversion rate in 2025 [30] - The company is actively pursuing mergers and acquisitions to enhance its tech-enabled services and strengthen its market position [17][54] Q&A Session Summary Question: Can you elaborate on the expected EBITDA margin improvement? - Management indicated that the focus will be on efficiency and reducing administrative costs, aiming for a 150 basis point improvement in EBITDA margins [68][70] Question: What is the organic growth target for the Geospatial segment? - The company has budgeted for 10% to 11% organic growth in the Geospatial Group, based on historical performance [72] Question: How much of the revenue guidance comes from acquisitions versus organic growth? - The guidance includes 5% to 7% organic growth, with approximately $17 million from acquisitions not included in 2024 [80][82] Question: What is the outlook for data center demand? - The company is experiencing around 25% organic growth in the data center sector, with strong international demand [98] Question: How is the company addressing inflation impacts on margins? - Management noted that inflation has affected administrative costs, but they are implementing strategies to improve margins as they cycle through contracts [116][120] Question: What is the status of the cloud-based software initiative? - The cloud-based revenue from the ENVI ecosystem software products doubled last year, indicating strong growth potential [124][127]

Geospatial Buildings & Technology Infrastructure Support Fourth Quarter & Full Year 2024 Results February 20, 2025 Disclaimer This presentation contains forward-looking statements about the Company's future business and financial performance. These are based on management's current expectations and are subject to risks and uncertainties. Factors that could cause actual results to differ materially from these statements are included in today's presentation slides and in our reports on file with the SEC. Duri ...

Core Viewpoint - NV5 Global reported quarterly earnings of $0.28 per share, missing the Zacks Consensus Estimate of $0.30 per share, representing a -6.67% earnings surprise [1] - The company posted revenues of $246.52 million for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 2.08% and showing a year-over-year increase from $215.5 million [2] Group 1: Earnings Performance - NV5's earnings of $0.28 per share for the recent quarter is a decrease from $0.29 per share a year ago [1] - The company has not surpassed consensus EPS estimates over the last four quarters [2] Group 2: Revenue Performance - The reported revenue of $246.52 million for the recent quarter is an increase of 14.4% compared to the previous year's revenue of $215.5 million [2] - NV5 has exceeded consensus revenue estimates three times in the last four quarters [2] Group 3: Stock Performance and Outlook - NV5 shares have declined approximately 9.6% since the beginning of the year, contrasting with the S&P 500's gain of 4.5% [3] - The company's earnings outlook and management commentary will be crucial for future stock performance [4] Group 4: Estimate Revisions and Future Expectations - The current consensus EPS estimate for the upcoming quarter is $0.20 on revenues of $229.5 million, and for the current fiscal year, it is $1.26 on revenues of $995.5 million [7] - The estimate revisions trend for NV5 is mixed, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Group 5: Industry Context - The Technology Services industry, to which NV5 belongs, is currently ranked in the top 36% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]