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Reasons to Retain Insperity (NSP) Stock in Your Portfolio

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Insperity, Inc. (NSP - Free Report) has had an impressive run on the bourse over the three months in which the stock gained 13.5% against 6.4% decline of the Zacks S&P 500 composite.

The company has an impressive Growth Score of A. This style score condenses all the essential metrics from a company’s financial statements to get a true sense of the quality and sustainability of its growth.

NSP has an expected long-term (three to five years) earnings per share growth rate of 15%. Its earnings are expected to increase 20.3% and 19.9% year over year, respectively, in 2022 and 2023.

What’s Supporting the Rally?

Insperity’s business is currently benefiting from strength in the professional employer organization or PEO industry. This is being driven by growth of small- and medium-sized businesses, increased need to provide employee benefits and workplace safety programs, as well as the related expenses, time and knowledge required to attain the technology infrastructure to administer benefits, HR and payroll processing on an integrated basis.

Insperity puts consistent efforts in rewarding its shareholders. During 2021, the company repurchased 716,000 shares for $69.7 million and paid out dividends totaling $144.2 million. During 2020, the company repurchased 1.4 million shares for $99.4 million and paid out dividends totaling $61.9 million. It repurchased 2.1 million shares for $203 million and paid out dividends totaling $48.6 million in 2019. Such moves indicate Insperity’s commitment toward boosting shareholders’ value and underline its confidence in business.

Hurdles to Counter

Insperity is seeing an increase in expenses as it continues to invest in growth, technology, and product and service offerings. During 2021, adjusted operating expenses of $646.8 million increased 5.7% year over year. The same rose 12.1% year over year in 2020 and 10.7% in 2019.

Zacks Rank and Stocks to Consider

Insperity currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the broader Zacks Business Services sector are Avis Budget Group, Inc. (CAR - Free Report) , Cross Country Healthcare (CCRN - Free Report) and Automatic Data Processing, Inc. (ADP - Free Report) .

Avis Budget sports a Zacks Rank #1 (Strong Buy) at present. CAR has a long-term earnings growth expectation of 19.4%. 

Avis Budget delivered a trailing four-quarter earnings surprise of 102%, on average. 

Cross Country Healthcare sports a Zacks Rank of 1. CCRN has a long-term earnings growth expectation of 6.9%.

Cross Country Healthcare delivered a trailing four-quarter earnings surprise of 29.2%, on average. 

Automatic Data Processing carries a Zacks Rank of 2, currently. ADP has a long-term earnings growth expectation of 12%.

Automatic Data Processing delivered a trailing four-quarter earnings surprise of 6.2%, on average.

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