Administaff Stock Jumps on Strong EPS

Shares of Administaff(ASF Quote) jumped nearly 12% in morning trading Monday after the payroll-management outsourcer, aided by cost-cutting measures, reported stronger-than-expected first-quarter earnings.

The company, based in Houston, said it earned $8.2 million, or 33 cents a share, in the quarter, down from last year's $13.2 million, or 51 cents a share, but better than analysts' per-share forecasts of a 29-cent profit, according to Thomson Reuters.

During the quarter, Administaff hiked the monthly fees it charges for each worksite employee, which served to boost revenue 1.3% to $462 million from $456.1 a year ago. The fee increase offset a 1.6% decline in the number of employees placed each month, on average, during the quarter.

The company said its operating expenses in the just-ended period were $2 million less than the fourth quarter of 2008, which led to the stronger-than-expected earnings.

Administaff shares moved recently at $29.46, up $3.05, or 11.55%.

Separately, Administaff released a survey of its small-business-owner clients, which indicated that more than 59% don't expect an economic turnaround until 2010 or later.