It has been about a month since the last earnings report for Robert Half (RHI Quick QuoteRHI - Free Report) . Shares have added about 20.1% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Robert Half due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Robert Half Q4 Earnings and Revenues Beat Estimates

Robert Half reported impressive fourth-quarter 2020 results, with earnings and revenues beating the Zacks Consensus Estimate.

Quarterly earnings of 84 cents per share beat the consensus mark by 23.5% but were down 14.3% year over year. Revenues of $1.3 billion surpassed the consensus mark by 8% but declined 15.2% year over year on a reported basis and 16% on an as-adjusted basis.

Staffing Revenues Decline, Protiviti Up

Global Staffing revenues of $942 million declined 23.6% year over year on a reported basis as well asand 24.3% on as-adjusted basis. U.S. staffing revenues of $723 million were down 24.8% on a reported and 24.6% on an as-adjusted basis. Non-U.S. staffing revenues declined 19.3% on a reported basis and 23.4% on an as-adjusted basis to $219 million. Currency exchange rate movements increased staffing revenues by $8 million.

The quarter had 61.7 billing days compared with 64.3 in the year-ago quarter. At present, Robert Half operates 326 staffing locations worldwide, with 88 locations situated in 17 countries outside the United States.

Protiviti revenues came in at $362 million, which increased 18.9% year over year on a reported basis and 17.9% on an as-adjusted basis. The U.S. Protiviti revenues of $294 million increased 22.9% year over year on a reported basis and 23.3% on an as-adjusted basis. Non-U.S Protiviti revenues of $68 million declined 4.3% on a reported basis and 1.7% on an as-adjusted basis.

Currently, Protiviti, along with its independently owned Member Firms, has a network of 86 locations in 27 countries.

Margins Shrink

Gross profit in the quarter was $514.3 million, down 19.2% year over year. Gross margin of 39.4% shrunk 200 basis points year over year. Operating income of $129.6 million was down 16% year over year. Operating margin declined to 9.3% from the year-ago quarter’s 10%.

Key Balance Sheet & Cash Flow Figures

Robert Half ended the quarter with cash and cash equivalents of $574 million compared with $587 million witnessed at the end of the previous quarter. Robert Half paid out $39 million in dividends and repurchased shares worth $63 million in the reported period.

Q1 Guidance

For the first quarter of 2021, Robert Half expects revenues in the range of $1.29 billion to $1.37 billion.

EPS is expected between 74 cents and 84 cents.
 

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 20.54% due to these changes.

VGM Scores

Currently, Robert Half has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Robert Half has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.