Korn Ferry (KFY), a global staffing firm, has outperformed expectations in its latest quarterly report, showing resilience in a challenging market. The company reported adjusted earnings of $1.26 per share, surpassing the consensus estimate of $1.13 and with significant growth from $1.01 per share a year ago. This 11.50% earnings surprise continues a trend of exceeding analyst projections, as Korn/Ferry has now beaten consensus estimates for four consecutive quarters. Despite beating analyst estimates for the quarter, FY 2024 revenue was $169.2 million, down 1.4% from FY 2023, and net income was $169.2 million, an 18% drop from the prior year. KFY rose last Thursday to $70.27 on the news, but by Monday, it lost some of that ground, trading around $66.34.
Zooming Out
Founded in 1969, Korn Ferry is an international management consulting company that provides organizational advisory services. They work with businesses to hire strategically and provide professional development. The firm has four business segments: Consulting, Recruitment Process Outsourcing (RPO) & Professional Search, Executive Search, and Digital. The company has a market cap of $3.32 billion. While Korn Ferry is a well-respected, longstanding staffing agency, its stock has underperformed so far this year. KFY was up around 6.8% compared to the S&P 500, which has gained 13.7%. The overall industry outlook can have a significant effect on a stock’s performance. The outlook for the staffing industry is uncertain. Indications show sustained growth but slower than in recent years.
What The Analysts Are Saying
The consensus among most analysts following Korn Ferry, which includes Goldman Sachs, Truist Securities, and Baird, put KFY as a strong buy with an average price target of $77. This represents a rise of 7.7% from previous price estimates. This suggests that the forecasted higher earnings have greater relevance than the lower revenue estimates. However, some analysts are more cautious. UBS, while raising its price target from $68 to $72, kept its neutral rating on the stock. While the company has shown its ability to navigate current economic conditions, staffing is an industry that can be greatly affected by the overall jobs market.
Neither Julie Stoller nor Stocks.News have positions in this company.
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Contributing Writer
As a professional writer since 2012, Julie Stoller has covered many industries, from healthcare and technology to consumer products and industrials. She has written about IPOs, spinoffs, ETFs, stock splits, commodities, legislative actions impacting investors, and macroeconomic issues. While keeping up with the latest meme stocks and trends, Julie's special interests are discovering ...