Why NASDAQ:STEP Is a Promising High-Growth Stock in the Midst of Consolidation.

Last update: Jan 3, 2025

Groth investors are looking for stocks showing high revenue and EPS growth. We will have a look here to see if STEPSTONE GROUP INC-CLASS A (NASDAQ:STEP) is suited for growth investing, while it is forming a base and may be ready to breakout. Investors should of course do their own research, but we spotted STEPSTONE GROUP INC-CLASS A showing up in our growth with base formation screen, so it may be worth spending some more time on it.

A Closer Look at Growth for NASDAQ:STEP

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NASDAQ:STEP has received a 9 out of 10:

STEP shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 58.25%, which is quite impressive.
STEP shows a strong growth in Revenue. In the last year, the Revenue has grown by 49.36%.
STEP shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 22.56% yearly.
The Earnings Per Share is expected to grow by 30.30% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 23.72% on average over the next years. This is a very strong growth
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

Evaluating Health: NASDAQ:STEP

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NASDAQ:STEP has earned a 5 out of 10:

With a decent Altman-Z score value of 1.61, STEP is doing good in the industry, outperforming 66.36% of the companies in the same industry.
STEP has a debt to FCF ratio of 1.33. This is a very positive value and a sign of high solvency as it would only need 1.33 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.33, STEP belongs to the top of the industry, outperforming 85.51% of the companies in the same industry.
A Debt/Equity ratio of 0.43 indicates that STEP is not too dependend on debt financing.
STEP has a better Debt to Equity ratio (0.43) than 73.36% of its industry peers.

Analyzing Profitability Metrics

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NASDAQ:STEP has achieved a 5:

STEP's Return On Invested Capital of 6.20% is fine compared to the rest of the industry. STEP outperforms 72.43% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for STEP is above the industry average of 6.63%.
The Gross Margin of STEP (93.01%) is better than 92.52% of its industry peers.
STEP's Gross Margin has improved in the last couple of years.

Looking at the Setup

ChartMill also assign a Setup Rating to every stock. With this score it is determined to what extend the stock has been trading in a range in the recent days and weeks. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. NASDAQ:STEP scores a 8 out of 10:

STEP has only a medium technical rating, but it does show a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is a support zone below the current price at 58.51, a Stop Loss order could be placed below this zone.

Every day, new Strong Growth stocks can be found on ChartMill in our Strong Growth screener.

Our latest full fundamental report of STEP contains the most current fundamental analsysis.

For an up to date full technical analysis you can check the technical report of STEP

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.