Barrons Is Positive on Robert Half International (RHI)
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A Barron's article printed this morning highlighted Robert Half International Inc. (NYSE: RHI), a specialized staffing and risk consulting company. Stocks of staffing companies have been beaten up this year amid concerns of an economic downturn for the U.S. in 2008. Today's Barron's article points out that Wall Street is unfairly categorizing Robert Half, the leading recruiter of accounting and other financial professionals, with most of the other staffers, making the Company's stock a bargain.
According to economists surveyed at the National Association for Business Economics, the odds that a recession will hit the U.S. economy is currently about 30%, while the staffing industry is currently pointing at a 75% chance of recession. The discrepancy shows a negative tendency toward the market facts rather than a belief in key metrics.
On the other hand, the article points out that even if a recession hit our economy, the segment that Robert Half deals in - middle management of accounting and finance professionals - remains relatively strong. When 1400 CFO's were polled by Robert Half, about 10% said they expect to hire additional staffers in the next three months, while only 4% said they expect to cut their workforce.
Barron's optimism toward Robert Half is backed up by strong financial results over the last year; The Company saw double-digit growth in most of its major segments: Accountemps grew revenues at about 17.5% so far in 2007, Office Team grew revenues at 10%, and Robert Half's information technology (IT) division grew its revenues at about 20%. Additionally, Robert Half has a clean balance sheet with lots of cash on hand and little debt: about $330 million in cash, to be specific.
The article points out that shares of Robert Half have sunk by about 40% since February, when the stock price was around $40. Shares of Robert Half have not traded around current levels since 2005 and Robert Half expects the Company's stock to make up that ground in 2008, calling Robert Half's recent stock price pullback a "buying opportunity".
According to economists surveyed at the National Association for Business Economics, the odds that a recession will hit the U.S. economy is currently about 30%, while the staffing industry is currently pointing at a 75% chance of recession. The discrepancy shows a negative tendency toward the market facts rather than a belief in key metrics.
On the other hand, the article points out that even if a recession hit our economy, the segment that Robert Half deals in - middle management of accounting and finance professionals - remains relatively strong. When 1400 CFO's were polled by Robert Half, about 10% said they expect to hire additional staffers in the next three months, while only 4% said they expect to cut their workforce.
Barron's optimism toward Robert Half is backed up by strong financial results over the last year; The Company saw double-digit growth in most of its major segments: Accountemps grew revenues at about 17.5% so far in 2007, Office Team grew revenues at 10%, and Robert Half's information technology (IT) division grew its revenues at about 20%. Additionally, Robert Half has a clean balance sheet with lots of cash on hand and little debt: about $330 million in cash, to be specific.
The article points out that shares of Robert Half have sunk by about 40% since February, when the stock price was around $40. Shares of Robert Half have not traded around current levels since 2005 and Robert Half expects the Company's stock to make up that ground in 2008, calling Robert Half's recent stock price pullback a "buying opportunity".
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