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TheStreet Open House

Korn/Ferry International (KFY) Stock Is Down Today Despite Earnings Beat

Stocks in this article: KFY

NEW YORK (TheStreet) -- Korn/Ferry International (KFY) shares are down -4.4% to $29.14 on Tuesday following the release of the company's fourth quarter earnings results.

The staffing solutions provider reported record sales during its fourth quarter period, increasing revenue 5.5% over the previous year to $251.7 million, ahead of analysts $244.6 million views.

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Earnings for the fourth quarter were 43 cents per share, 4 cents better than what analysts anticipated.

The company also reported first quarter 2015 earnings guidance between 37 cents and 43 cents, in line with analysts 40 cent per diluted share expectations for the quarter.

TheStreet Ratings team rates KORN/FERRY INTERNATIONAL as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate KORN/FERRY INTERNATIONAL (KFY) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, attractive valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • KFY's revenue growth has slightly outpaced the industry average of 11.9%. Since the same quarter one year prior, revenues rose by 19.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • KFY has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, KFY has a quick ratio of 1.88, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Powered by its strong earnings growth of 115.00% and other important driving factors, this stock has surged by 77.11% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, KFY should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Professional Services industry. The net income increased by 124.7% when compared to the same quarter one year prior, rising from $9.48 million to $21.30 million.
  • You can view the full analysis from the report here: KFY Ratings Report
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