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Winners And Losers Of Q3: Korn Ferry (NYSE:KFY) Vs The Rest Of The Professional Staffing & HR Solutions Stocks

KFY Cover Image

The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Korn Ferry (NYSE: KFY) and the rest of the professional staffing & hr solutions stocks fared in Q3.

The Professional Staffing & HR Solutions subsector within Business Services is set to benefit from evolving workforce trends, including the rise of remote work and the gig economy. With companies casting a wider net to find talent due to remote work, the expertise of staffing and recruiting companies is even more valuable. For those who invest wisely, the use of predictive AI in recruitment and screening as well as automation in HR workflows can enhance efficiency and scalability. On the other hand, digitization means that talent discovery is less of a manual process, opening the door for tech-first platforms. Additionally, regulatory scrutiny around data privacy in HR is evolving and may require companies in this sector to change their go-to-market strategies over time.

The 8 professional staffing & hr solutions stocks we track reported a mixed Q3. As a group, revenues beat analysts’ consensus estimates by 0.5% while next quarter’s revenue guidance was 1.1% below.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 5.4% since the latest earnings results.

Korn Ferry (NYSE: KFY)

With clients including 97% of the S&P 100 and operations in 103 offices across 51 countries, Korn Ferry (NYSE: KFY) is a global consulting firm that helps organizations design optimal structures, recruit talent, develop leaders, and create effective compensation strategies.

Korn Ferry reported revenues of $729.8 million, up 7% year on year. This print exceeded analysts’ expectations by 1.7%. Despite the top-line beat, it was still a slower quarter for the company with revenue guidance for next quarter slightly missing analysts’ expectations and a slight miss of analysts’ EPS guidance for next quarter estimates.

Korn Ferry Total Revenue

Korn Ferry achieved the biggest analyst estimates beat of the whole group. Unsurprisingly, the stock is up 1.6% since reporting and currently trades at $66.03.

Read our full report on Korn Ferry here, it’s free for active Edge members.

Best Q3: Kforce (NYSE: KFRC)

With nearly 60 years of matching skilled professionals with the right opportunities, Kforce (NYSE: KFRC) is a professional staffing company that specializes in placing technology and finance experts with businesses on both temporary and permanent bases.

Kforce reported revenues of $332.6 million, down 5.9% year on year, outperforming analysts’ expectations by 1.5%. The business had an exceptional quarter with revenue guidance for next quarter exceeding analysts’ expectations and a beat of analysts’ EPS estimates.

Kforce Total Revenue

The market seems happy with the results as the stock is up 26% since reporting. It currently trades at $30.91.

Is now the time to buy Kforce? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: Insperity (NYSE: NSP)

Pioneering the professional employer organization (PEO) industry it helped establish, Insperity (NYSE: NSP) provides human resources outsourcing services to small and medium-sized businesses, handling payroll, benefits, compliance, and HR administration.

Insperity reported revenues of $1.62 billion, up 4% year on year, in line with analysts’ expectations. It was a disappointing quarter as it posted a significant miss of analysts’ full-year EPS guidance estimates and a significant miss of analysts’ EPS guidance for next quarter estimates.

As expected, the stock is down 14.1% since the results and currently trades at $38.72.

Read our full analysis of Insperity’s results here.

ManpowerGroup (NYSE: MAN)

Founded during the post-World War II economic boom when businesses needed temporary workers, ManpowerGroup (NYSE: MAN) connects millions of people to employment opportunities through its global network of staffing, recruitment, and workforce management services.

ManpowerGroup reported revenues of $4.63 billion, up 2.3% year on year. This number topped analysts’ expectations by 0.7%. Aside from that, it was a satisfactory quarter as it also produced an impressive beat of analysts’ EPS guidance for next quarter estimates but a significant miss of analysts’ EPS estimates.

The stock is down 21.8% since reporting and currently trades at $29.73.

Read our full, actionable report on ManpowerGroup here, it’s free for active Edge members.

Barrett (NASDAQ: BBSI)

Operating as a professional employer organization (PEO) that serves over 8,000 companies with more than 120,000 worksite employees, Barrett Business Services (NASDAQ: BBSI) provides management solutions that help small and mid-sized businesses handle human resources, payroll, workers' compensation, and other administrative functions.

Barrett reported revenues of $318.9 million, up 8.4% year on year. This print was in line with analysts’ expectations. However, it was a slower quarter as it logged a miss of analysts’ EPS estimates and revenue in line with analysts’ estimates.

The stock is down 11.1% since reporting and currently trades at $36.21.

Read our full, actionable report on Barrett here, it’s free for active Edge members.


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