Korn/Ferry International (KFY - Free Report) is cashing in on the strong global staffing trends. This Zacks Rank #1 (Strong Buy) is expected to grow earnings by the double digits both in Fiscal 2018 and Fiscal 2019.
Korn Ferry is an organizational consulting firm which specializes in executive search. Headquartered in Los Angeles, it has 7,000 employers in more than 50 countries.
A Big Beat in the Third Quarter of Fiscal 2018
On Mar 6, Korn Ferry reported its fiscal third quarter 2018 results and blew past the Zacks Consensus Estimate by $0.11. Earnings were $0.70 compared to the Zacks Consensus of $0.59.
This was the sixth earnings beat in a row.
It saw record fee revenue in the quarter which rose 17.2% to $447.6 million from $381.9 million in the year ago quarter.
All three lines of the business drove growth with Futurestep up 29.4%, Executive Search up 18.1% and Hay Group up 12.7%.
Free revenue growth was partially offset by increased compensation and benefits as well as general administrative expenses.
Guided Q4 Range Above Consensus
Korn Ferry gave an earnings range for the fourth quarter between $0.66 to $0.70 which was at the higher range of the Zacks Consensus, at $0.67.
Revenue is expected to be in the range of $448 million and $462 million.
The analysts are bullish. They raised estimates following this quarter with 4 estimates moving higher for fiscal 2018. It pushed the full year estimate up to $2.63 from $2.49 over the last 60 days.
That's earnings growth of 17.4%.
3 estimates also moved higher for fiscal 2019 which pushed the Zacks Consensus up to $3.05 from $2.83 over the last 2 months.
That's another year of double digit earnings growth, with the analysts looking for 16% growth.
For investors looking for a way to play the hot job market, Korn Ferry is a stock that should be on the short list.
Shares at 5 Year Highs
With the global economy humming, it's not surprising that the staffing industry is hot.
Wall Street has figured it out as shares of Korn Ferry have jumped 75.8% in the last year and are up another 36% year-to-date.
Even with the big stock move, the shares are attractively priced for a growth stock.
It trades with a forward P/E of 20.7.
For investors looking for a way to invest in the hot job market, Korn Ferry is a stock to keep on the short list.
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