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Weekly Jobless Claims Continue to Decline: 5 Staffing Picks
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U.S. Labor Department’s weekly jobless claims data for the week ended Mar 10 provides fresh evidence that the labor market is in strong shape. Since the beginning of this year, the U.S. labor market remains firm buoyed by strong job additions and record-low unemployment level. Modest wage growth assuaged employer’s fears over rising inflation and interest rate hikes.
Strong non-farm payrolls data for February along with continuing decline in the weekly jobless claim indicates that employers will continue to recruit more employees. U.S. employers are on a hiring mode as both blue collar and white collar industries hiring as the economy remains remarkably strong. Consequently, it makes sense to invest in good staffing stocks to enrich portfolio.
Jobless Claims Continues to Slip
On Mar 15, the U.S. Labor Department data revealed that weekly jobless claims decreased 4,000 to a seasonally adjusted 226,000 for the week ended Mar 10. This was the 158th consecutive week that the number of Americans filing for unemployment benefits remained below the 300,000 threshold. The continued decline in weekly jobless claims data reflects longest trend since 1970.
The four-week moving average of initial claims dropped 750 to 221,500 for the week ended Mar 10. This metric is considered a better measure of labor market trends as it eliminates weekly fluctuations. Likewise, the four-week moving average of continuing claims declined 17,250 to 1.89 million. This was the lowest level witnessed since November 2017.
On Mar 12, the U.S. Labor Department Data revealed that the economy added 313,000 jobs in February 2018, exceeding the consensus estimate of 208,000. Moreover, the total labor force increased by 806,000 and now stands slightly below 162 million. This is the highest since September 2003. (Read: Asia Stocks Gain on Upbeat U.S. Jobs Data: 5 Top Picks)
This reflects a robust U.S. labor market which is operating at its near full employment level currently.
Strong Recruitment Trend
Most of the traditionally blue collar and white collar industries hired last month. Blue collar industries are mostly led by construction companies. Such companies filled 61,000 positions, while manufacturing sectors hired 31,000. Even mining, which is known as a job-losing industry of late, added 9,000 workers. Retailers added 50,000 jobs and the financial service sector filled 28,000 jobs. (Read: Strongest Hiring Spree in a Year and a Half: 5 Staffing Picks)
Robust job creation side by side continuous decrease in jobless claims indicates the U.S. economy’s fundamental strength. The labor force participation rate and the employment-to-population ratio rose to 63% and 60.4%, respectively. Both figures were at its highest since September 2017.
Our Picks
The latest jobless claims data bode well for staffing industry. The U.S. jobless rate currently stands at a 17-year low of 4.1%. Solid macro-economic fundamentals, government’s tax reform and deregulation proposals along with sustained strong earnings performance are major tailwinds for the U.S. labor market. Such factors are unlikely to disappear in the near term.
The buoyancy in the staffing space is further confirmed by its solid Zacks Industry Rank in the top 12% (30 out of 256), indicating continued hiring and more job opportunities. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
Adding staffing stocks to your portfolios makes great sense at this point. However, picking winning stocks can be a difficult task.
This is where our VGM score comes in. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three scores. Such a score allows you to eliminate the negative aspects of stocks and select winners. However, it is important to keep in mind that each Style Score will carry a different weight while arriving at a VGM Score.
At this stage, we have narrowed down our search to the following stocks with favourable Zacks Rank #1 (Strong Buy) or 2 (Buy) and a good VGM score of either A or B.
The chart below shows that our five picks have performed strong in the last six months compared with the industry.
Kforce Inc. (KFRC - Free Report) is a full-service, web-based specialty staffing firm providing flexible and permanent staffing solutions for organizations and career management for individuals.
The company expects earnings growth of 35.7% for current year. The Zacks Consensus Estimate for the current year has improved by 21% over the last 60 days. The stock has a VGM score of A. The stock flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Korn/Ferry International (KFY - Free Report) is the world's leading and largest executive recruitment firm with the broadest global presence in the executive recruitment industry. It carries a Zacks Rank #1.
The company expects earnings growth of 17.4% for current year. The Zacks Consensus Estimate for the current year has improved by 5.6% over the last 60 days. The stock has a VGM score of A.
Insperity Inc. (NSP - Free Report) is engaged in providing an array of human resources and business solutions. It carries a Zacks Rank #2.
The company expects earnings growth of 24.1% for current year. The Zacks Consensus Estimate for the current year has improved by 14.7% over the last 60 days. The stock has a VGM score of A.
TrueBlue Inc. (TBI - Free Report) is a leading provider of specialized workforce solutions. It helps clients to improve growth and performance by providing staffing, workforce management and recruitment process outsourcing solutions. It carries a Zacks Rank #2.
The company expects earnings growth of 27% for current year. The Zacks Consensus Estimate for the current year has improved by 18.8% over the last 60 days. The stock has a VGM score of A.
On Assignment Inc. (ASGN - Free Report) is one of the foremost providers of in-demand, highly skilled professionals in the technology, digital, creative, healthcare and life sciences sectors. It carries a Zacks Rank #2.
The company expects earnings growth of 23.3% for current year. The Zacks Consensus Estimate for the current year has improved by 13.3% over the last 60 days. The stock has a VGM score of B.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Weekly Jobless Claims Continue to Decline: 5 Staffing Picks
U.S. Labor Department’s weekly jobless claims data for the week ended Mar 10 provides fresh evidence that the labor market is in strong shape. Since the beginning of this year, the U.S. labor market remains firm buoyed by strong job additions and record-low unemployment level. Modest wage growth assuaged employer’s fears over rising inflation and interest rate hikes.
Strong non-farm payrolls data for February along with continuing decline in the weekly jobless claim indicates that employers will continue to recruit more employees. U.S. employers are on a hiring mode as both blue collar and white collar industries hiring as the economy remains remarkably strong. Consequently, it makes sense to invest in good staffing stocks to enrich portfolio.
Jobless Claims Continues to Slip
On Mar 15, the U.S. Labor Department data revealed that weekly jobless claims decreased 4,000 to a seasonally adjusted 226,000 for the week ended Mar 10. This was the 158th consecutive week that the number of Americans filing for unemployment benefits remained below the 300,000 threshold. The continued decline in weekly jobless claims data reflects longest trend since 1970.
The four-week moving average of initial claims dropped 750 to 221,500 for the week ended Mar 10. This metric is considered a better measure of labor market trends as it eliminates weekly fluctuations. Likewise, the four-week moving average of continuing claims declined 17,250 to 1.89 million. This was the lowest level witnessed since November 2017.
On Mar 12, the U.S. Labor Department Data revealed that the economy added 313,000 jobs in February 2018, exceeding the consensus estimate of 208,000. Moreover, the total labor force increased by 806,000 and now stands slightly below 162 million. This is the highest since September 2003. (Read: Asia Stocks Gain on Upbeat U.S. Jobs Data: 5 Top Picks)
This reflects a robust U.S. labor market which is operating at its near full employment level currently.
Strong Recruitment Trend
Most of the traditionally blue collar and white collar industries hired last month. Blue collar industries are mostly led by construction companies. Such companies filled 61,000 positions, while manufacturing sectors hired 31,000. Even mining, which is known as a job-losing industry of late, added 9,000 workers. Retailers added 50,000 jobs and the financial service sector filled 28,000 jobs. (Read: Strongest Hiring Spree in a Year and a Half: 5 Staffing Picks)
Robust job creation side by side continuous decrease in jobless claims indicates the U.S. economy’s fundamental strength. The labor force participation rate and the employment-to-population ratio rose to 63% and 60.4%, respectively. Both figures were at its highest since September 2017.
Our Picks
The latest jobless claims data bode well for staffing industry. The U.S. jobless rate currently stands at a 17-year low of 4.1%. Solid macro-economic fundamentals, government’s tax reform and deregulation proposals along with sustained strong earnings performance are major tailwinds for the U.S. labor market. Such factors are unlikely to disappear in the near term.
The buoyancy in the staffing space is further confirmed by its solid Zacks Industry Rank in the top 12% (30 out of 256), indicating continued hiring and more job opportunities. In fact, the top 50% of Zacks Ranked Industries outperforms the bottom 50% by a factor of more than 2 to 1.
Adding staffing stocks to your portfolios makes great sense at this point. However, picking winning stocks can be a difficult task.
This is where our VGM score comes in. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three scores. Such a score allows you to eliminate the negative aspects of stocks and select winners. However, it is important to keep in mind that each Style Score will carry a different weight while arriving at a VGM Score.
At this stage, we have narrowed down our search to the following stocks with favourable Zacks Rank #1 (Strong Buy) or 2 (Buy) and a good VGM score of either A or B.
The chart below shows that our five picks have performed strong in the last six months compared with the industry.
Kforce Inc. (KFRC - Free Report) is a full-service, web-based specialty staffing firm providing flexible and permanent staffing solutions for organizations and career management for individuals.
The company expects earnings growth of 35.7% for current year. The Zacks Consensus Estimate for the current year has improved by 21% over the last 60 days. The stock has a VGM score of A. The stock flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Korn/Ferry International (KFY - Free Report) is the world's leading and largest executive recruitment firm with the broadest global presence in the executive recruitment industry. It carries a Zacks Rank #1.
The company expects earnings growth of 17.4% for current year. The Zacks Consensus Estimate for the current year has improved by 5.6% over the last 60 days. The stock has a VGM score of A.
Insperity Inc. (NSP - Free Report) is engaged in providing an array of human resources and business solutions. It carries a Zacks Rank #2.
The company expects earnings growth of 24.1% for current year. The Zacks Consensus Estimate for the current year has improved by 14.7% over the last 60 days. The stock has a VGM score of A.
TrueBlue Inc. (TBI - Free Report) is a leading provider of specialized workforce solutions. It helps clients to improve growth and performance by providing staffing, workforce management and recruitment process outsourcing solutions. It carries a Zacks Rank #2.
The company expects earnings growth of 27% for current year. The Zacks Consensus Estimate for the current year has improved by 18.8% over the last 60 days. The stock has a VGM score of A.
On Assignment Inc. (ASGN - Free Report) is one of the foremost providers of in-demand, highly skilled professionals in the technology, digital, creative, healthcare and life sciences sectors. It carries a Zacks Rank #2.
The company expects earnings growth of 23.3% for current year. The Zacks Consensus Estimate for the current year has improved by 13.3% over the last 60 days. The stock has a VGM score of B.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>