3 Business Services Stocks to Buy Now as Markets Rebound
As markets continue to rebound on hopes that the U.S.-Iran conflict will be resolved, several stocks in the Zacks Business Services sector are worth considering.
These technology-driven companies have strong growth prospects and have started to trade at much more reasonable valuations, making the argument that their recent pullbacks may be overdone.
In addition to landing spots on the coveted Zacks Rank #1 (Strong Buy) list, these top business services stocks are sporting an overall “A” VGM Zacks Style Scores grade for the combination of Value, Growth, and Momentum.
DAVE Inc – DAVE
Stock Price: $173
We’ll start with Dave Inc DAVE), a digital banking and financial services platform focused on helping consumers, especially those underserved by traditional banks, to manage cash flow, avoid overdraft fees, and access short-term liquidity.
As one of the fastest-growing fintech firms in the U.S., Dave Inc’s stock is at an attractive 11X forward earnings multiple with EPS expected to increase 10% in FY26 and projected to spike another 24% next year to $18.12 per share.
High double-digit sales growth has been just as compelling and reassuring, with Dave Inc’s top line expanding more than 170% since posting annual sales of $205 million in 2022, its IPO year. Starting to fulfil its lofty growth projections, Dave Inc’s stock has still soared over 400% in the last two years, but is trading more than 50% from its 52-week and all-time peak of $286 a share.
Image Source: Zacks Investment Research
GigaCloud Technology – GCT
Stock Price: $45
Next up is GigaCloud Technology GCT), which went public in 2022 as a pioneer of global end-to-end B2B technology solutions for large parcel merchandise.
GCT had been one of the hottest momentum stocks this year, and the lid on the rally could be taken off again if geopolitical tensions affecting the broader market continue to ease. To that point, GCT is up 17% year to date and is still near an all-time peak of $48 a share.
GigaCloud’s outperformance comes as the company crushed Q4 EPS expectations in February, with quarterly earnings at $1.04 per share compared to estimates of $0.65.
Plus, GCT also trades at 11X forward earnings with annual EPS now expected to increase over 14% in FY26 and FY27. Following the impressive Q4 earnings beat, FY26 and FY27 EPS estimates have spiked 17% and 16% in the last 60 days, respectively.
More compelling is that GigaCloud is climbing past the $1 billion in annual sales milestone, and GCT notably trades under the preferred level of less than 2X forward sales.
Image Source: Zacks Investment Research
Sezzle Inc – SEZL
Stock Price: $63
Rounding out this list of intriguing business services stocks to consider is Sezzle Inc SEZL), a purpose-driven digital payments platform that increases the purchasing power of consumers by offering interest-free installment plans at online stores and select in-store locations.
Like Dave inc, Sezzle’s stock is presenting a glaring buy-the-dip opportunity with SEZL posting monstrous gains of more than 400% in the last two years as well, but is now trading more than 60% from its 52-week and all-time high of $186 a share.
Going public in 2023, Sezzle’s stock is now at a much more reasonable 13X forward earnings multiple, and high double-digit top and bottom line growth is in the forecast for the foreseeable future. Sezzle’s annual sales projections are moving further past $500 million, with EPS expected to spike 30% this year and projected to increase another 23% in FY27 to $5.80.
Image Source: Zacks Investment Research
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in the coming year. While not all picks can be winners, previous recommendations have soared +112%, +171%, +209% and +232%.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
Dave Inc. (DAVE) : Free Stock Analysis Report
GigaCloud Technology Inc. (GCT) : Free Stock Analysis Report
Sezzle Inc. (SEZL) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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