Insperity (NYSE:NSP) Posts Quarterly Earnings Results, Beats Estimates By $0.01 EPS

Key Points

• Insperity beat quarterly estimates: Adjusted EPS was $0.22 versus the $0.21 consensus, while revenue reached $1.65 billion, up 1.7% year over year and slightly ahead of expectations.
• Profitability improved substantially: Gross profit per worksite employee rose 8%, adjusted EBITDA increased 210% to $31 million, and operating expenses fell 5%. However, average paid worksite employees declined about 1.8%, highlighting ongoing customer-volume pressure.
• 2026 guidance was raised, but investors remain cautious: Management expects adjusted EBITDA of $194 million-$214 million and adjusted EPS of $1.93-$2.28, while higher benefits costs and slower employment growth remain risks. Shares fell 10.1% after the report, and the stock carries a consensus “Reduce” rating.

Insperity (NYSE:NSP - Get Free Report) announced its quarterly earnings data on Thursday. The business services provider reported $0.22 EPS for the quarter, beating analysts' consensus estimates of $0.21 by $0.01, FiscalAI reports. The business had revenue of $1.65 billion during the quarter, compared to analyst estimates of $1.64 billion. Insperity had a negative net margin of 0.23% and a negative return on equity of 19.99%. The firm's revenue for the quarter was up 1.7% on a year-over-year basis. During the same quarter in the prior year, the business earned ($0.20) earnings per share.

Here are the key takeaways from Insperity's conference call:

• Margin recovery is gaining traction: Q3 gross profit per worksite employee rose 8% year over year, adjusted EPS improved to $0.22 from a $0.20 loss, and adjusted EBITDA increased 210% to $31 million. Operating expenses declined 5% due primarily to lower staffing and compensation costs.
• The margin strategy continues to weigh on growth, with average paid worksite employees down 1.8% in Q3 and expected to decline 1.4%-2.0% year over year in Q4. Management said new sales and client attrition are likely to largely offset each other in the fourth quarter, while the fall campaign remains too early to assess.
• Management raised confidence in the earnings trajectory, forecasting full-year 2026 adjusted EBITDA of $194 million-$214 million, up 48%-63%, and adjusted EPS of $1.93-$2.28, up 87%-121%. The company expects additional gross-profit improvement in Q4 from pricing actions and a more favorable client mix.
• Benefits costs increased 3.7% per covered employee, while workers’ compensation results faced higher reported costs and fewer favorable reserve adjustments. Executives cited elevated healthcare costs and increasing claim severity as market pressures that could persist, requiring continued pricing actions.
• Insperity is positioning AI as a long-term growth opportunity through its proprietary tools, the HR360 AI Agent, and its Workday partnership. Management believes AI-driven workplace changes could increase demand for HR expertise, but acknowledged that the commercial impact and client adoption timeline remain uncertain.

Insperity Trading Down 10.1%

NSP traded down $5.20 during midday trading on Thursday, reaching $46.45. 704,513 shares of the company's stock were exchanged, compared to its average volume of 398,866. The company has a quick ratio of 1.11, a current ratio of 1.11 and a debt-to-equity ratio of 6.87. The business has a 50-day simple moving average of $50.20 and a two-hundred day simple moving average of $39.64. Insperity has a one year low of $18.57 and a one year high of $55.90.

Insperity Dividend Announcement

The firm also recently declared a quarterly dividend, which was paid on Thursday, September 17th. Shareholders of record on Wednesday, September 2nd were paid a dividend of $0.60 per share. The ex-dividend date was Wednesday, September 2nd. This represents a $2.40 dividend on an annualized basis and a yield of 5.2%. Insperity's dividend payout ratio (DPR) is currently -558.14%.

Insperity News Roundup

Here are the key news stories impacting Insperity this week:

• Positive Sentiment: Insperity reported third-quarter revenue of $1.651 billion, up approximately 2% year over year and ahead of the $1.64 billion consensus estimate. Adjusted earnings of $0.22 per share also exceeded expectations of roughly $0.20-$0.21, while the company’s net loss narrowed substantially from the prior-year quarter. Insperity, Inc. reports third quarter 2026 results
• Positive Sentiment: Gross profit increased 6% to $207 million as operating expenses declined 5% to $209 million. For the first nine months, revenue rose 2% and net income increased 38% to $36 million. Insperity also repurchased approximately 131,000 shares during the quarter. Insperity, Inc. Reports Earnings Results
• Neutral Sentiment: Management provided full-year 2026 adjusted EPS guidance of $1.93 to $2.28 and adjusted EBITDA guidance of $194 million to $214 million. The ranges give investors updated targets, but the market appears focused on whether Insperity can deliver them amid slower client employment growth. Insperity, Inc. Provides Earnings Guidance
• Neutral Sentiment: Insperity’s research found that small and midsize businesses investing in both artificial intelligence and employees report better outcomes. The finding supports the company’s broader human-capital strategy but is unlikely to materially affect near-term earnings. Insperity SMB research
• Negative Sentiment: Average paid worksite employees fell 2% to 307,265, indicating continued pressure on Insperity’s customer base and a potentially weaker volume environment. Revenue per worksite employee rose 4% because of pricing, but investors may view pricing-driven growth as less durable than employment-driven expansion. Insperity Q3 revenue and net loss results
• Negative Sentiment: Although adjusted EPS was positive, reported diluted EPS was a loss of $0.02, and Insperity continued to post a negative net margin. The combination of declining worksite employment and only modest revenue growth likely overshadowed the quarterly earnings beat, explaining the pressure on NSP. Why Insperity stock is trading lower

Wall Street Analyst Weigh In

A number of equities research analysts recently weighed in on NSP shares. Zacks Research raised Insperity from a "strong sell" rating to a "hold" rating in a research report on Wednesday, July 29th. Robert W. Baird set a $56.00 price objective on Insperity in a research report on Friday, July 31st. Truist Financial set a $52.00 price objective on Insperity and gave the stock a "hold" rating in a report on Wednesday, July 22nd. Roth Capital set a $61.00 price objective on Insperity in a research report on Friday, July 31st. Finally, Weiss Ratings restated a "sell (d+)" rating on shares of Insperity in a research note on Tuesday, October 13th. One research analyst has rated the stock with a Buy rating, two have given a Hold rating and two have issued a Sell rating to the stock. According to MarketBeat, Insperity currently has a consensus rating of "Reduce" and a consensus target price of $53.33.

Insperity Company Profile

Insperity, Inc provides human resources and business solutions designed primarily for small and midsize companies in the United States. The company operates as a professional employer organization (PEO), helping clients manage employment-related responsibilities while supporting their day-to-day operations.

Its services include payroll and tax administration, employee benefits, workers' compensation, human resources guidance, regulatory compliance, recruiting and talent management, performance management, and employee training.

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