Kforce (NASDAQ:KFRC) Shares Gap Down on Disappointing Earnings

Key Points

• Kforce Inc. reported disappointing earnings with a 0.59 EPS for the quarter, missing analysts' expectations of $0.60, and its quarterly revenue fell 6.2% year-over-year.
• Shares of Kforce gapped down from a previous close of $46.91 to open at $44.32, and were last traded at $41.23.
• Brokerages have revised their ratings on Kforce, with Wall Street Zen downgrading it from "buy" to "hold" and UBS raising its target price from $40 to $45.

Kforce Inc. (NASDAQ:KFRC - Get Free Report) shares gapped down prior to trading on Tuesday following a dissappointing earnings announcement. The stock had previously closed at $46.91, but opened at $44.32. Kforce shares last traded at $41.23, with a volume of 9,756 shares trading hands.

The business services provider reported $0.59 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.60 by ($0.01). The firm had revenue of $334.32 million for the quarter, compared to the consensus estimate of $333.78 million. Kforce had a return on equity of 30.34% and a net margin of 3.59%. Kforce's quarterly revenue was down 6.2% on a year-over-year basis. During the same period in the prior year, the company posted $0.75 earnings per share.

Kforce Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Friday, September 26th. Investors of record on Friday, September 12th will be paid a $0.39 dividend. The ex-dividend date is Friday, September 12th. This represents a $1.56 dividend on an annualized basis and a dividend yield of 4.28%. Kforce's payout ratio is 65.27%.

Wall Street Analysts Forecast Growth

A number of brokerages have recently issued reports on KFRC. UBS Group dropped their price objective on shares of Kforce from $45.00 to $40.00 and set a "neutral" rating for the company in a research note on Wednesday. Truist Financial cut their target price on Kforce from $50.00 to $46.00 and set a "hold" rating for the company in a research report on Tuesday. Finally, Wall Street Zen lowered Kforce from a "buy" rating to a "hold" rating in a research note on Friday, May 2nd.

Insider Activity

In other Kforce news, Director David L. Dunkel purchased 1,000 shares of the firm's stock in a transaction that occurred on Monday, May 5th. The shares were acquired at an average cost of $37.80 per share, for a total transaction of $37,800.00. Following the transaction, the director directly owned 517,329 shares in the company, valued at approximately $19,555,036.20. The trade was a 0.19% increase in their ownership of the stock. The purchase was disclosed in a filing with the SEC, which is available through this link. Company insiders own 4.40% of the company's stock.

Hedge Funds Weigh In On Kforce

Institutional investors and hedge funds have recently bought and sold shares of the business. MetLife Investment Management LLC lifted its position in Kforce by 2.9% during the 4th quarter. MetLife Investment Management LLC now owns 11,189 shares of the business services provider's stock worth $634,000 after buying an additional 312 shares in the last quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. raised its stake in shares of Kforce by 4.6% in the first quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 10,841 shares of the business services provider's stock worth $530,000 after acquiring an additional 474 shares during the last quarter. PNC Financial Services Group Inc. raised its stake in shares of Kforce by 18.8% in the first quarter. PNC Financial Services Group Inc. now owns 3,027 shares of the business services provider's stock worth $148,000 after acquiring an additional 480 shares during the last quarter. Bank of New York Mellon Corp raised its stake in shares of Kforce by 0.3% in the first quarter. Bank of New York Mellon Corp now owns 149,463 shares of the business services provider's stock worth $7,307,000 after acquiring an additional 492 shares during the last quarter. Finally, Tower Research Capital LLC TRC lifted its position in shares of Kforce by 147.3% during the fourth quarter. Tower Research Capital LLC TRC now owns 1,118 shares of the business services provider's stock worth $63,000 after purchasing an additional 666 shares in the last quarter. Institutional investors and hedge funds own 92.77% of the company's stock.

Kforce Price Performance

The company's 50 day moving average price is $41.96 and its 200 day moving average price is $46.04. The company has a debt-to-equity ratio of 0.16, a current ratio of 2.06 and a quick ratio of 2.06. The firm has a market capitalization of $679.03 million, a P/E ratio of 13.60 and a beta of 0.75.

About Kforce

Kforce Inc provides professional staffing services and solutions in the United States. It operates through two segments, Technology, and Finance and Accounting (FA). The Technology segment provides talent solutions to its clients primarily in the areas of information technology, such as systems/applications architecture and development, data management and analytics, business and artificial intelligence, machine learning, project and program management, and network architecture and security.