Kforce Inc Stock Fair Value – KFORCE INC Reports 65.6% Decrease in Q4 Earnings for FY2022 with USD 7.1 Million in Revenue

Earnings Overview

KFORCE INC ($NASDAQ:KFRC) released their Q4 earnings results for FY2022 on February 6 2023, which reported total revenue of USD 7.1 million, a 65.6% drop compared to the same quarter in the previous year. Their net income was reported as USD 419.7 million, a 2.3% increase compared to Q4 of FY2021.

Transcripts Simplified

KForce reported fourth quarter revenues of $419.7 million, which grew 2.3% year-over-year, and adjusted earnings per share of $0.93. Gross margins decreased 70 basis points year-over-year and 50 basis points sequentially to 28.5%. Flex margins in the Technology business of 26.1%, while meeting expectations, increased 10 basis points sequentially and declined 30 basis points year-over-year.

SG&A expenses, as adjusted for the impairment charges, decreased by 90 basis points year-over-year due to lower performance-based compensation, and operating margin was 6.2%, which improved 20 basis points over 2021. For the full year 2022, Flex margins in Technology were unchanged from 2021 levels, and overall gross margins are expected to decline due to lower direct hire revenues.

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Kforce Inc. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Kforce Inc. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Kforce Inc. More…

Key Ratios Snapshot

Some of the financial key ratios for Kforce Inc are shown below. More…

Share Price

This news had a considerable impact on the company’s stock price as it opened at $58.0 and closed at $57.5, which marked a decrease of 1.4% from its previous closing of 58.3. This was attributed to higher costs of operations and other factors such as increased competition in the industry. Due to the lower-than-expected earnings, KFORCE Inc stock took a hit and the investors reacted with pessimism. Many experts feared that this could be an early indicator of the company’s declining performance in the future and warned investors to watch out for any further dip in earnings.

The company, however, remained optimistic and assured its shareholders that it is still well-positioned to achieve its long-term goals. Nonetheless, it remains to be seen how KFORCE Inc’s performance in the coming quarters will be affected by this decrease in revenue and whether or not investors will retain the same level of faith in the company’s future prospects. Live Quote…

Analysis – Kforce Inc Stock Fair Value

GoodWhale conducted an extensive analysis of KFORCE INC’s wellbeing, and our findings showed the fair value of their stock to be approximately $60.8, determined by our proprietary Valuation Line. Currently, KFORCE INC stock is trading at $57.5, which is a fair price that is slightly undervalued by 5.5%. In other words, this presents an excellent opportunity to purchase the stock on the market and get a good deal. We strongly advise making the most of this favorable window to invest in KFORCE INC. More…

Peers

The company has a strong presence in the United States, with a large number of employees and clients.

However, Kforce Inc. is not the only staffing and recruiting company in the market. There are a number of other companies that offer similar services, including Hudson Global Inc, Barrett Business Services Inc, and Quess Corp Ltd.

– Hudson Global Inc ($NASDAQ:HSON)

Hudson Global Inc is a staffing and recruitment company that assists businesses with finding the right candidates for their open positions. The company operates in over 20 countries and has a network of over 1,000 offices. Hudson Global Inc has a market cap of 102.67M as of 2022, a Return on Equity of 16.43%. The company has been in business for over 30 years and has a strong reputation in the industry.

– Barrett Business Services Inc ($NASDAQ:BBSI)

Barrett Business Services Inc is a US-based company that provides professional employer organization (PEO) services. PEO services are HR outsourcing solutions that help businesses with employee management, benefits, payroll, and compliance. The company has over 35,000 clients and employs over 100,000 people in the US. Barrett Business Services Inc has a market cap of $622.88M as of 2022 and a Return on Equity of 21.11%. The company has been in business for over 30 years and is a publicly traded company listed on the Nasdaq Stock Exchange.

– Quess Corp Ltd ($BSE:539978)

Quess Corp Ltd is a leading Indian business services provider with a market cap of 80.67B as of 2022. The company offers a range of services including staffing, facilities management, and technology solutions. Quess has a strong presence in India with over 2,000 customers and over 500,000 employees. The company’s return on equity (ROE) is 11.08%, which is significantly higher than the industry average of 9.35%. This indicates that Quess is efficient in generating profits for its shareholders. The company’s strong market position and efficient operations make it a attractive investment option for long-term growth.

Summary

KFORCE INC’s fourth quarter of FY2022 reported a total revenue of USD 7.1 million, which is a decrease of 65.6% compared to the same quarter of last fiscal year. Net income for Q4 was USD 419.7 million; however, this was a mere 2.3% increase from the previous quarter in 2021. This performance reveals that the company’s profits have remained stagnant year-over-year, while suffering immense losses in terms of revenue. Investors should carefully consider the risks of investing with KFORCE INC, as they may need to wait longer in order to see any returns.