Robert Half (RHI – Research Report), the Industrials sector company, was revisited by a Wall Street analyst today. Analyst Tobey Sommer from Truist Financial maintained a Hold rating on the stock and has a $72.00 price target.
Tobey Sommer has given his Hold rating due to a combination of factors including the expectation that Robert Half International Inc. (RHI) is nearing the end of a cycle of negative revisions to earnings estimates. Sommer’s analysis suggests that the company’s earnings per share (EPS) estimates, which have been decreasing for approximately two years, are likely to stabilize in the upcoming quarters. He notes that despite the potential for a further 10%-15% reduction in EPS estimates for 2025, stocks in this sector tend to rebound prior to the bottoming out of analyst expectations. Additionally, Sommer finds RHI’s valuation to be more reasonable now, as it trades at a multiple that is in line with his projections for the company’s 2025 EBITDA.
The report also acknowledges that the majority of the share underperformance compared to the market may have already occurred, with shares declining significantly from their peak in 2022 but less so than during the Global Financial Crisis (GFC). Sommer observes that while RHI’s EBITDA and sales have also decreased from their peak, the declines are not as pronounced as those experienced during the GFC. Furthermore, he appreciates the company’s seasoned management and historically strong organic growth and return on invested capital (ROIC). Nevertheless, Sommer remains cautious due to the current pessimism within RHI’s core small and medium-sized business (SMB) customer base and potential risks such as further macroeconomic or labor market downturns.
Based on the recent corporate insider activity of 30 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of RHI in relation to earlier this year.
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Robert Half (RHI) Company Description:
Robert Half International, Inc. engages in the provision of staffing and risk consulting services. It operates through the following segments: Temporary and Consultant Staffing, Permanent Placement Staffing and Risk Consulting & Internal Audit Services. The Temporary and Consultant Staffing segment offers staffing in the accounting and finance, administrative and office, information technology, legal, advertising, marketing, and web design fields. The Permanent Placement Staffing segment provides full-time personnel in the accounting, finance, administrative & office and information technology fields. The Risk Consulting and Internal Audit Services segment comprises business and technology risk consulting and internal audit services. The company was founded by Robert Half in 1948 and is headquartered in Menlo Park, CA.
