3 Resilient Consulting Stocks to Consider Amid Industry Woes

Industry Overview - The Consulting Services industry is facing challenges due to ongoing geopolitical tensions, tariff uncertainties, and fears of an economic slowdown through 2026, leading to budget cuts and delayed decision-making [1][5] - Despite these challenges, strong demand for AI-driven transformation and corporate cost optimization efforts are providing some resilience [1] - The industry is expected to continue its exponential growth beyond 2025, building on momentum from the post-2008 financial crisis [3] Economic Conditions - Recent economic activity has slowed, with GDP declining at an annual rate of 0.5% in Q1 2025, following a 2.4% increase in Q4 2024 [5] - The services sector contracted for the first time since June 2024, with the ISM Services PMI dropping to 49.9, indicating cautious corporate spending [5] Industry Performance - The Consulting Services industry has underperformed compared to the S&P 500 and the broader sector, losing 8.3% over the past year while the S&P 500 gained 11.3% [9] - The industry currently has a Zacks Industry Rank of 165, placing it in the bottom 32% of 244 Zacks industries, indicating a challenging outlook [6] Valuation Metrics - The industry is trading at a forward 12-month price-to-earnings (P/E) ratio of 24.51X, higher than the S&P 500's 22.13X and the sector's 21.94X [12] Key Companies Stantec Inc. (STN) - Stantec provides professional services in infrastructure and facilities, benefiting from strong macroeconomic drivers and effective internal strategies [16][17] - The Zacks Consensus Estimate for Stantec's 2025 EPS is $3.86, reflecting a nearly 1% increase in the past 30 days [18] CBIZ, Inc. (CBZ) - CBIZ is a major provider of financial, insurance, and advisory services for middle-market businesses, entering a strong growth phase due to strategic expansion [21][22] - The Zacks Consensus Estimate for CBIZ's 2025 EPS is $3.62, remaining unchanged in the past 30 days [23] Charles River Associates (CRAI) - CRAI offers economic, financial, and management consulting services, focusing on high-quality analytical and strategic consulting across diverse industries [26][27] - The Zacks Consensus Estimate for CRAI's 2025 EPS is $8, unchanged in the past 30 days [29]