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UBS maintains neutral stance on Kforce, despite mixed portfolio shifts


On Thursday, UBS maintained its neutral recommendation for professional staffing services firm Kforce (NASDAQ:KFRC), setting a one-year price target at $64.77, an upside of 8.08% from the closing price of $59.93. With projected annual revenue for Kforce at $1,696 million, marking a growth of 2.63%, and the non-GAAP EPS estimated at $4.00, the outlook appears steady.

InvestingPro data reveals that Kforce has a market cap of 1130M USD and a P/E Ratio of 18.1. The company’s revenue stands at 1652.47M USD, reflecting a revenue growth of -0.85% in the last twelve months up to Q2 2023. The company’s gross profit for the same period was 470.39M USD, making up 28.47% of the revenue.

Despite a decrease of three owners from the last quarter, total institutional ownership has risen by 0.80% to 22,366K shares. The put/call ratio of KFRC is at a bearish level of 3.37.

Kayne Anderson Rudnick Investment Management holds the largest stake in Kforce with 2,514K shares or a 13.09% ownership stake, having increased its portfolio allocation in KFRC by 71.96%. Fidelity Small Cap Discovery (NASDAQ:WBD) Fund holds 736K shares and has increased its portfolio allocation in KFRC by 6.03%.

Charles Schwab (NYSE:SCHW) Investment Management, owning 605K shares, decreased its portfolio allocation in KFRC by 0.74%. Vaughan Nelson Investment Management also reduced its exposure to Kforce, owning 596K shares but decreasing its portfolio allocation by 6.93%.

Kforce announced a quarterly dividend of $0.36 per share ($1.44 annualized) on July 31, 2023, yielding 2.40%. The dividend payout ratio is 0.43, suggesting that nearly half of the company’s earnings are paid out as dividends. The firm has a three-year dividend growth rate of 0.80%, and the standard deviation of the dividend yield is 0.39, with a historical average yield of 2.05%.

InvestingPro Tips reveal that Kforce has maintained dividend payments for 12 consecutive years and has raised its dividend for 5 consecutive years. The company’s management has been aggressively buying back shares, which is a positive sign for investors. These tips, along with many more, are available to subscribers of InvestingPro, a valuable resource for investors. For more information, visit InvestingPro.

Kforce Inc., specializing in the Technology and Finance and Accounting sectors, serves over 3,000 clients, including a significant majority of the Fortune 500. This wide-ranging clientele base signifies a robust business model capable of attracting and retaining high-profile customers. The company operates with a high return on assets, as indicated by the 15.83% return on assets in the last twelve months up to Q2 2023, according to InvestingPro data.


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