Let’s dig into the relative performance of Barrett (NASDAQ:BBSI) and its peers as we unravel the now-completed Q1 professional staffing & hr solutions earnings season.
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 Q1. As a group, revenues beat analysts’ consensus estimates by 0.8% while next quarter’s revenue guidance was 0.7% below.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
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 $292.6 million, up 10.1% year on year. This print exceeded analysts’ expectations by 2.3%. Overall, it was an exceptional quarter for the company with an impressive beat of analysts’ EPS estimates.
“BBSI delivered a strong start to the year, highlighted by record gross and net WSE additions and continued high client retention,” said Gary Kramer, President and CEO of BBSI.
Interestingly, the stock is up 4.9% since reporting and currently trades at $42.79.
Is now the time to buy Barrett? Access our full analysis of the earnings results here, it’s free.
Best Q1: First Advantage (NASDAQ:FA)
Processing approximately 100 million background checks annually across more than 200 countries and territories, First Advantage (NASDAQ:FA) provides employment background screening, identity verification, and compliance solutions to help companies manage hiring risks.
First Advantage reported revenues of $354.6 million, up 109% year on year, outperforming analysts’ expectations by 2.9%. The business had an exceptional quarter with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ full-year EPS guidance estimates.
First Advantage pulled off the fastest revenue growth and highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 13.7% since reporting. It currently trades at $17.02.
Is now the time to buy First Advantage? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: Robert Half (NYSE:RHI)
With roots dating back to 1948 as the first specialized recruiting firm for accounting and finance professionals, Robert Half (NYSE:RHI) provides specialized talent solutions and business consulting services, connecting skilled professionals with companies across various fields.
Robert Half reported revenues of $1.35 billion, down 8.4% year on year, falling short of analysts’ expectations by 4.3%. It was a disappointing quarter as it posted a significant miss of analysts’ EPS estimates.
Robert Half delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 7.4% since the results and currently trades at $43.03.
Read our full analysis of Robert Half’s results here.
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 $330 million, down 6.2% year on year. This print missed analysts’ expectations by 1%. Overall, it was a softer quarter as it also produced a miss of analysts’ EPS estimates.
The stock is up 2.1% since reporting and currently trades at $43.55.
Read our full, actionable report on Kforce here, it’s free.
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 $719.8 million, up 2.8% year on year. This number surpassed analysts’ expectations by 3%. More broadly, it was a mixed quarter as it also recorded a decent beat of analysts’ EPS estimates but revenue guidance for next quarter missing analysts’ expectations.
Korn Ferry delivered the biggest analyst estimates beat among its peers. The stock is up 11.9% since reporting and currently trades at $74.64.
Read our full, actionable report on Korn Ferry here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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