We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Insperity (NSP) Riding on PEO Industry Strength Amid Cost Woes
Read MoreHide Full Article
Insperity, Inc. (NSP - Free Report) is currently benefiting from strength in the professional employer organization (“PEO”) services industry and a strong cash position, while increasing expenses remain a concern.
The company recently reported first-quarter 2021 adjusted earnings of $1.82 per share that beat the Zacks Consensus Estimate by 16.7% and increased 7.1% year over year. Revenues of $1.29 billion surpassed the consensus mark by 6.5% and increased 4.7% year over year.
Notably, the stock gained 90.5% over the past year, significantly outperforming the 80.3% rally of the industry it belongs to.
PEO Industry Strength, Strong Cash Position are Positives
Insperity looks strong on the back of a growing PEO industry which is currently being driven by growth of small- and medium-sized businesses, increased need of providing employee benefits, and complex regulation of payroll, payroll tax and employment issues.
Insperity, being an integrated human resources and business solutions provider, offers a comprehensive suite of HR services solutions through PEO services known as Workforce Optimization and Workforce Synchronization solutions.
The company exited the March quarter with cash and equivalents of $575 million, which is above the total debt of $369 million. This indicates that the company has sufficient cash to meet its debt obligations. Moreover, Insperity does not have any current debt.
Insperity puts consistent efforts to reward its shareholders. During 2020, the company repurchased 1.4 million shares for $99.4 million and paid out dividends totaling $61.9 million. It repurchased shares for $203 million, $113.3 million, $38.7 million and $31.7 million, and paid out dividends totaling $48.6 million, $33.4 million, $65.8 million and $20.6 million in 2019, 2018, 2017 and 2016, respectively. Such moves indicate Insperity’s commitment toward boosting shareholders’ value, underlining its confidence in its business.
Expense Woe Stays
Insperity is seeing an increase in expenses as it continues to invest in growth, technology, and product and service offerings. In first quarter-2021, operating expenses increased 12.6% year over year to $167.62 million. During 2020, adjusted operating expenses of $612.2 million increased 12.1% year over year. The same rose 10.7% year over year in 2019 and 12% in 2018. Hence, the bottom line is likely to remain under pressure going forward.
The long-term expected earnings per share (three to five years) growth rate for ExlService, Equifax and TransUnion is 10.8%, 14% and 20.9%, respectively.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Image: Bigstock
Insperity (NSP) Riding on PEO Industry Strength Amid Cost Woes
Insperity, Inc. (NSP - Free Report) is currently benefiting from strength in the professional employer organization (“PEO”) services industry and a strong cash position, while increasing expenses remain a concern.
The company recently reported first-quarter 2021 adjusted earnings of $1.82 per share that beat the Zacks Consensus Estimate by 16.7% and increased 7.1% year over year. Revenues of $1.29 billion surpassed the consensus mark by 6.5% and increased 4.7% year over year.
Notably, the stock gained 90.5% over the past year, significantly outperforming the 80.3% rally of the industry it belongs to.
PEO Industry Strength, Strong Cash Position are Positives
Insperity looks strong on the back of a growing PEO industry which is currently being driven by growth of small- and medium-sized businesses, increased need of providing employee benefits, and complex regulation of payroll, payroll tax and employment issues.
Insperity, being an integrated human resources and business solutions provider, offers a comprehensive suite of HR services solutions through PEO services known as Workforce Optimization and Workforce Synchronization solutions.
The company exited the March quarter with cash and equivalents of $575 million, which is above the total debt of $369 million. This indicates that the company has sufficient cash to meet its debt obligations. Moreover, Insperity does not have any current debt.
Insperity puts consistent efforts to reward its shareholders. During 2020, the company repurchased 1.4 million shares for $99.4 million and paid out dividends totaling $61.9 million. It repurchased shares for $203 million, $113.3 million, $38.7 million and $31.7 million, and paid out dividends totaling $48.6 million, $33.4 million, $65.8 million and $20.6 million in 2019, 2018, 2017 and 2016, respectively. Such moves indicate Insperity’s commitment toward boosting shareholders’ value, underlining its confidence in its business.
Expense Woe Stays
Insperity is seeing an increase in expenses as it continues to invest in growth, technology, and product and service offerings. In first quarter-2021, operating expenses increased 12.6% year over year to $167.62 million. During 2020, adjusted operating expenses of $612.2 million increased 12.1% year over year. The same rose 10.7% year over year in 2019 and 12% in 2018. Hence, the bottom line is likely to remain under pressure going forward.
Zacks Rank and Stocks to Consider
Insperity currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the broader Zacks Business Services sector are ExlService (EXLS - Free Report) , Equifax (EFX - Free Report) and TransUnion (TRU - Free Report) , each carrying a Zacks Rank #2 (Buy).
The long-term expected earnings per share (three to five years) growth rate for ExlService, Equifax and TransUnion is 10.8%, 14% and 20.9%, respectively.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>