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Anatomy of Success: Korn/Ferry International (KFY)
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The proven Zacks Rank is great method for both beginning and experienced investors to identify the strongest stocks to buy. The model, which recognizes the importance of earnings estimates and estimate revisions, highlights stocks of all shapes and size that are poised to outperform the market.
When a company earns the coveted Zacks Rank #1 (Strong Buy), it is displaying the right characteristics to outperform the market over the next one to three months. We believe our #1 picks are the strongest options based on this Zacks Rank model, and only about 5% of the several thousand companies we track earn this designation at one time.
In the story below, you will learn about one particular company that helped show the strength of the Zacks Rank. If investors had followed our ranking system when it flagged this staffing firm, they would have witnessed massive profits.
Korn/Ferry is the world’s largest executive recruitment firm with the broadest global presence in the executive recruitment industry. KFY’s clients are many of the world’s largest public and private companies, middle-market, and emerging growth companies—as well as governmental and not-for-profit organizations.
KFY has been spotted by the Zacks Rank a number of times in recent months. In fact, it first earned a Zacks Rank #2 (Buy) on Oct. 13, 2017. This designation was earned just a few weeks after the firm was able to surpass earnings estimates and record EPS growth of 5.8% in its most recent quarter. But that was only the start of KFY’s remarkable run.
Over the next few months, KFY would appear on the #2 (Buy) list for multiple weeks, never dipping below a #3 (Hold) through multiple earnings reports. One of those reports would actually see the company’s EPS growth really start to pick up, eventually inspiring analyst sentiment to pick up to the point that KFY earned its first #1 (Strong Buy).
That report came in early March, when KFY reported quarterly earnings of $0.70 per share against our consensus estimate of $0.59. That earnings result also marked year-over-year growth of 32%. The stock would snag another #2 (Buy) just days later, and when analysts started revising estimates upward in the coming weeks, the stock reached the #1 list on March 30.
Investors will also note that KFY just reported strong earnings again earlier this month, and the stock is once again holding a Zacks Rank #1 (Strong Buy).
The below chart demonstrates the price performance for KFY and 12-month forward EPS estimate (in red), starting from when the stock earned that first #2 (Buy) designation back in October.
As we can see, KFY was a massive winner for those that followed the Zacks Rank. The stock has gained about 57% over the months reflected in the above chart, including a solid 29% since its earnings report in March. KFY is yet another great example of the predictive power of the Zacks Rank.
Want more market analysis from this author? Make sure to follow @Ryan_McQueeneyon Twitter!
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Anatomy of Success: Korn/Ferry International (KFY)
The proven Zacks Rank is great method for both beginning and experienced investors to identify the strongest stocks to buy. The model, which recognizes the importance of earnings estimates and estimate revisions, highlights stocks of all shapes and size that are poised to outperform the market.
When a company earns the coveted Zacks Rank #1 (Strong Buy), it is displaying the right characteristics to outperform the market over the next one to three months. We believe our #1 picks are the strongest options based on this Zacks Rank model, and only about 5% of the several thousand companies we track earn this designation at one time.
In the story below, you will learn about one particular company that helped show the strength of the Zacks Rank. If investors had followed our ranking system when it flagged this staffing firm, they would have witnessed massive profits.
Korn/Ferry International (KFY - Free Report)
Korn/Ferry is the world’s largest executive recruitment firm with the broadest global presence in the executive recruitment industry. KFY’s clients are many of the world’s largest public and private companies, middle-market, and emerging growth companies—as well as governmental and not-for-profit organizations.
KFY has been spotted by the Zacks Rank a number of times in recent months. In fact, it first earned a Zacks Rank #2 (Buy) on Oct. 13, 2017. This designation was earned just a few weeks after the firm was able to surpass earnings estimates and record EPS growth of 5.8% in its most recent quarter. But that was only the start of KFY’s remarkable run.
Over the next few months, KFY would appear on the #2 (Buy) list for multiple weeks, never dipping below a #3 (Hold) through multiple earnings reports. One of those reports would actually see the company’s EPS growth really start to pick up, eventually inspiring analyst sentiment to pick up to the point that KFY earned its first #1 (Strong Buy).
That report came in early March, when KFY reported quarterly earnings of $0.70 per share against our consensus estimate of $0.59. That earnings result also marked year-over-year growth of 32%. The stock would snag another #2 (Buy) just days later, and when analysts started revising estimates upward in the coming weeks, the stock reached the #1 list on March 30.
Investors will also note that KFY just reported strong earnings again earlier this month, and the stock is once again holding a Zacks Rank #1 (Strong Buy).
The below chart demonstrates the price performance for KFY and 12-month forward EPS estimate (in red), starting from when the stock earned that first #2 (Buy) designation back in October.
As we can see, KFY was a massive winner for those that followed the Zacks Rank. The stock has gained about 57% over the months reflected in the above chart, including a solid 29% since its earnings report in March. KFY is yet another great example of the predictive power of the Zacks Rank.
Want more market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>