HOLLYWOOD, Fla. – NV5 Global, Inc. (NASDAQ: NVEE), a provider of infrastructure engineering and consulting services, announced the acquisition of California Water Resources Group from Weston Solutions. This move is designed to expand NV5’s water resources capabilities and broaden its environmental compliance client base.

Based in Carlsbad, California, California Water Resources Group employs approximately 20 specialists focused on environmental compliance for aquatic environments. Their expertise is expected to complement NV5’s existing water infrastructure and hydrospatial services. The acquisition, an all-cash transaction, will be immediately accretive to NV5’s earnings, with revenue recognition expected by the end of the third quarter of 2024.

Dickerson Wright, PE, Executive Chairman of NV5, pointed to the growing demand for compliance services in the water industry driven by expanding infrastructure and stringent regulatory requirements. “The acquisition of California Water Resources Group will help us meet the growing demand for these services,” Wright said.

NV5 provides a range of services including engineering design, environmental, surveying and geospatial services addressing water, wastewater, stormwater, coastal resilience and marine infrastructure. The company has over 100 offices in the U.S. and internationally and is committed to delivering sustainable solutions to complex problems and improving community life.

The acquisition is part of NV5’s strategic expansion in the water resources sector, which represents an increasingly significant part of its business portfolio. This transaction is expected to open up new contract opportunities and provide access to a wider range of customers, particularly municipal and state authorities.

The information contained is based on a press release from NV5 Global, Inc. The forward-looking statements in the press release reflect the Company’s expectations as of the date hereof and are subject to various factors that could cause actual results to differ materially, including market demand, economic conditions, competitive pressures, regulatory changes and other risks described in NV5’s SEC filings.

In other recent news, NV5 Global Inc. reported a successful second quarter in 2024, forecasting strong growth and targeting $400 million in revenue in the data center space. The company’s backlog has grown to $877 million, showing robust demand for its infrastructure, geospatial, and building and technology services. In particular, the geospatial services segment is thriving due to federal contract awards and demand in the utility market. The building and technology segment reported 18% growth, driven by expansion in data centers, clean energy, and building digitization.

NV5 also raised its full-year revenue guidance to $944 million to $950 million and is targeting total revenue of $1 billion by the end of 2024. These recent developments reflect the company’s strong organic growth and a 9% increase in backlog compared to the prior year quarter. The company is optimistic about future growth, plans acquisitions to strengthen its segments and is focused on expanding its customer base in the transportation and water sectors.

However, future acquisitions are not included in the current forecast, reflecting a conservative approach. Nevertheless, NV5 is experiencing strong demand in its Geospatial and Buildings & Technology segments and has signed master service agreements that promise future growth beyond the next 12 months.

InvestingPro Insights

NV5 Global, Inc. (NASDAQ: NVEE) is strengthening its position in the water resources sector through strategic acquisitions, such as the recent acquisition of California Water Resources Group. This move should have an immediate positive impact on NV5’s earnings. The company’s financial health and market performance provide a broader context for understanding this expansion.

A tip from InvestingPro highlights NV5’s impressive gross profit margins, which stand at 50.88% for the trailing twelve months (as of Q2 2024). This robust margin demonstrates the company’s ability to efficiently manage its manufacturing costs and has a positive impact on its operational efficiency, especially in the context of its recent acquisition.

InvestingPro Data also shows that NV5 has a market capitalization of $1.57 billion and a price-to-earnings (P/E) ratio of 46.59. This suggests that investors are willing to pay a higher price for NV5’s earnings, possibly due to expectations of future growth. Furthermore, the company has maintained a stable revenue growth of 12.93% over the past twelve months (as of Q2 2024), suggesting consistent performance in its sector.

Although NV5 does not pay a dividend to its shareholders, the company’s strategy is focused on growth and expansion, as demonstrated by its recent acquisition. Analysts are forecasting a profit for the current year and a strong return for the past decade. So NV5 seems to be on solid ground to capitalize on the increasing demand for compliance services for the water industry.

For investors who want a more in-depth analysis, 9 more InvestingPro tips for NV5 are available at https://www.investing.com/pro/NVEE. These tips provide valuable insight into the company’s finances, market trends and analyst forecasts, helping investors make informed decisions.

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