We recently published a list of 11 Best Consulting Stocks to Buy Right Now. In this article, we are going to look at where Resources Connection, Inc. (NASDAQ:RGP) stands against other best consulting stocks to buy right now.
According to a report by Mordor Intelligence, the Consulting Service Market is valued at $354.01 billion in 2024 and is projected to reach $447.72 billion by 2029, growing at a Compound Annual Growth Rate (CAGR) of 4.81%. This growth is driven by several key factors, including the increasing complexity of business operations, the rapid evolution of technology landscapes, and a heightened focus on strategic decision-making. The integration of technology into consulting services is a significant trend shaping the market. Technology-driven consulting leverages advanced tools and techniques to offer cutting-edge solutions.
Big Consulting Firms Profit Massively from AI Consulting
According to a report by the New York Times, AI is revolutionizing the consulting industry, enabling firms to achieve significant revenue growth through services such as AI strategy development, generative AI implementation, and natural language processing solutions. Consulting giants are generating hundreds of millions of dollars from AI services and reshaping the business transformation landscape. Consulting firms are not merely incorporating AI as an additional service; they are restructuring their operations around it. In just two years, Boston Consulting Group (BCG) transformed its AI consulting revenue from zero to an impressive one-fifth of its total earnings. Likewise, McKinsey is forecasting that 40% of its business will soon be AI-related.
AI is redefining efficiency in consulting. PwC’s AI solutions, for example, streamline document searches and analysis for government projects, reducing manual work and enabling deeper, faster insights. Advanced tools like these not only enhance internal processes but also provide clients with actionable intelligence that drives strategic advantage. In addition to efficiency, AI is enabling innovative business models, such as subscription-based services for continuous AI insights. AI tools are also transforming strategic decision-making by offering unbiased, data-driven insights. PwC is investing $1 billion in AI over three years, which underscores the importance of integrating AI into business strategy. According to BCC Research, the global AI consulting services market is experiencing rapid growth, growing at a 34.2% CAGR from 2023 to 2028, rising from $64.3 billion in 2023.
The consulting service market is on the cusp of substantial growth, fueled by the increasing complexity of business operations, the rapid pace of technological evolution, and a heightened focus on strategic decision-making. Big consulting firms are harnessing the power of AI to transform their business models and deliver unprecedented value to clients.
A business person consulting with their financial advisor showing their portfolio of stocks.
Our Methodology
To compile our list of the 11 best consulting stocks to buy right now, we used Finviz and Yahoo stock screeners to find the companies in the consulting services sector. We then used Insider Monkey’s Hedge Fund database to rank 11 stocks according to the largest number of hedge fund holders, as of Q3 2024. The list is sorted in ascending order of hedge fund sentiment.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Resources Connection, Inc. (NASDAQ:RGP)
Number of Hedge Fund Investors: 23
Resources Connection, Inc. (NASDAQ:RGP), operating as RGP, is a global consulting firm that provides on-demand Talent, consulting, and outsourced services to a diverse range of clients. The company operates under the brands On-Demand by RGP, Veracity by RGP, and Countsy by RGP. Resources Connection, Inc. (NASDAQ:RGP) company aims to deliver tailored solutions that meet the evolving needs of its clients.
Resources Connection, Inc. (NASDAQ:RGP) has undertaken significant changes to its operating model and brand architecture to better align with the needs of its clients and the competitive landscape. The company has restructured its business into four segments: On-Demand Talent, Consulting, Outsourced Services, and a combined Europe and Asia Pacific region. This new structure allows Resources Connection, Inc. (NASDAQ:RGP) to serve a broader range of client needs and penetrate new buying centers within existing and future client sets. By articulating its capabilities and competitive advantages, the company aims to enhance cross-selling opportunities and deepen client relationships.
Resources Connection, Inc. (NASDAQ:RGP) is actively expanding its capabilities both organically and through strategic acquisitions. The company is also investing in technology, including AI-powered talent acquisition and management software, to drive faster speed to market and improve efficiency. These investments are already yielding results, with the company seeing increased engagement from clients and a growing gross pipeline. Resources Connection, Inc. (NASDAQ:RGP) has built global delivery centers in the Philippines and India to provide flexible, cost-effective talent solutions to clients. These centers enable the company to deliver in-country, nearshore, and offshore services to meet the diverse needs of clients across different geographies. The company is also focusing on cross-border sales within its multinational client base and leveraging its global infrastructure to provide seamless and integrated services.
Overall, RGP ranks 5th on our list of one of the best consulting stocks to buy right now. While we acknowledge the potential of RGP to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than RGP but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. This article is originally published at Insider Monkey.
