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Insperity (NSP - Free Report) reported encouraging third-quarter 2026 results, with earnings and revenues surpassing the Zacks Consensus Estimate.
The stock price has not witnessed any significant impact from the earnings beat since the company released results on Oct. 29.
NSP reported adjusted earnings of 22 cents per share, beating the 20-cent consensus estimate by 10%. The figure improved from an adjusted loss of 20 cents in the year-ago quarter. Revenues increased 1.7% year over year to $1.65 billion, surpassing the consensus estimate of $1.63 billion by 1.1%.
Results benefited from higher pricing, improved gross profit per worksite employee and lower operating expenses despite a decline in the average number of paid worksite employees.
Adjusted EBITDA surged 210% year over year to $31 million, reflecting progress in the company's margin recovery initiatives. The reported net loss narrowed 95% to $1 million from $20 million in the prior-year quarter. Loss narrowed to 2 cents per share from 53 cents.
Management attributed the improvement to pricing adjustments, client retention strategies, benefit plan modifications and expense discipline. These initiatives helped restore profitability despite weaker employee volumes. The company also benefited from a more favorable client mix as its pricing and retention strategy prioritized profitable accounts.
Insperity's Pricing Gains Lift Unit Economics
Average paid worksite employees (WSEEs) declined 1.8% year over year to 307,265 from 312,842. Management attributed the decline to the impacts of its margin recovery plan on new client sales and retention, partially offset by improved net hiring within the existing client base.
Revenues per WSEE per month increased 3.6% to $1,791 from $1,729, reflecting higher pricing. Gross billings per WSEE increased to $11,997 from $11,432, while payroll costs per WSEE rose to $10,206 from $9,703.
Gross profit increased 6.2% to $207 million, while gross profit per WSEE improved 8.2% to $225. Benefits costs per covered employee increased 3.7%, consistent with management's expectations. However, higher workers' compensation costs, partly reflecting less favorable prior-year reserve adjustments, remained a headwind.
NSP's Cost Discipline Supports Operating Recovery
Operating expenses declined 5% year over year to $209 million. Salaries, wages and payroll taxes decreased 4.8% to $119 million, while stock-based compensation declined 25% to $12 million.
Commission expenses fell 23.1% to $10 million, while advertising expenses increased 10% to $11 million. General and administrative expenses rose 4.4% to $47 million. Depreciation and amortization expenses declined to $10 million from $11 million.
The company reported an operating loss of $2 million compared with a loss of $25 million a year earlier. Operating expenses per WSEE declined 3.4% to $227, reflecting lower corporate staffing and compensation-related costs.
Insperity's 9-Month Performance Shows Progress
For the first nine months of 2026, revenues increased 1.7% year over year to $5.23 billion. Average paid WSEEs declined 1.3% to 305,359, while revenues per WSEE increased 3% to $1,904.
Gross profit remained relatively flat at $726 million, while operating expenses declined 4.6% to $660 million. Reported net income increased 38.5% to $36 million, with earnings rising to 95 cents per share from 69 cents.
Adjusted EBITDA increased 18.1% to $170 million, while adjusted earnings rose 13.5% to $1.85 per share. These improvements reflected the cumulative benefits of the company's margin recovery initiatives.
NSP Maintains Liquidity & Shareholder Returns
Insperity ended September with $599 million in cash and cash equivalents compared with $642 million at 2025-end. Adjusted cash increased to $119 million from $57 million, while outstanding debt stood at approximately $419 million.
During the quarter, the company paid out $23 million in dividends and repurchased approximately 131,000 shares for $6 million. Capital expenditure totaled $13 million. Management continues balancing shareholder distributions with investments in technology and growth initiatives.
Insperity Updates Q4 & 2026 Outlook
For the fourth quarter of 2026, Insperity expects average paid WSEEs between 306,000 and 308,000, indicating a year-over-year decline of 1.4-2%.
Adjusted earnings are projected between 7 cents and 42 cents per share compared with an adjusted loss of 60 cents a year earlier. The midpoint (24.50 cents) of the guided range is lower than the Zacks Consensus Estimate of 28 cents.
Adjusted EBITDA is anticipated between $24 million and $44 million.
For 2026, the company forecasts adjusted earnings of $1.93-$2.28 per share compared with the preceding quarter’s view of $1.88-$2.43. The midpoint ($2.11) of the guided range is lower than the Zacks Consensus Estimate of $2.14.
Adjusted EBITDA is projected between $194 million and $214 million, indicating 48-63% growth. Average paid WSEEs are expected to be between 305,500 and 306,000.
Management expects continued pricing improvements and lower operating costs to support profitability. Meanwhile, strengthening sales activity, HRScale implementation and artificial intelligence initiatives remain central to rebuilding growth momentum in 2027.
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NSP Stock Barely Moves Since Posting Q3 Earnings & Revenue Beat
Key Takeaways
Insperity (NSP - Free Report) reported encouraging third-quarter 2026 results, with earnings and revenues surpassing the Zacks Consensus Estimate.
The stock price has not witnessed any significant impact from the earnings beat since the company released results on Oct. 29.
NSP reported adjusted earnings of 22 cents per share, beating the 20-cent consensus estimate by 10%. The figure improved from an adjusted loss of 20 cents in the year-ago quarter. Revenues increased 1.7% year over year to $1.65 billion, surpassing the consensus estimate of $1.63 billion by 1.1%.
Results benefited from higher pricing, improved gross profit per worksite employee and lower operating expenses despite a decline in the average number of paid worksite employees.
Insperity, Inc. Price, Consensus and EPS Surprise
Insperity, Inc. price-consensus-eps-surprise-chart | Insperity, Inc. Quote
NSP's Margin Recovery Drives Earnings Rebound
Adjusted EBITDA surged 210% year over year to $31 million, reflecting progress in the company's margin recovery initiatives. The reported net loss narrowed 95% to $1 million from $20 million in the prior-year quarter. Loss narrowed to 2 cents per share from 53 cents.
Management attributed the improvement to pricing adjustments, client retention strategies, benefit plan modifications and expense discipline. These initiatives helped restore profitability despite weaker employee volumes. The company also benefited from a more favorable client mix as its pricing and retention strategy prioritized profitable accounts.
Insperity's Pricing Gains Lift Unit Economics
Average paid worksite employees (WSEEs) declined 1.8% year over year to 307,265 from 312,842. Management attributed the decline to the impacts of its margin recovery plan on new client sales and retention, partially offset by improved net hiring within the existing client base.
Revenues per WSEE per month increased 3.6% to $1,791 from $1,729, reflecting higher pricing. Gross billings per WSEE increased to $11,997 from $11,432, while payroll costs per WSEE rose to $10,206 from $9,703.
Gross profit increased 6.2% to $207 million, while gross profit per WSEE improved 8.2% to $225. Benefits costs per covered employee increased 3.7%, consistent with management's expectations. However, higher workers' compensation costs, partly reflecting less favorable prior-year reserve adjustments, remained a headwind.
NSP's Cost Discipline Supports Operating Recovery
Operating expenses declined 5% year over year to $209 million. Salaries, wages and payroll taxes decreased 4.8% to $119 million, while stock-based compensation declined 25% to $12 million.
Commission expenses fell 23.1% to $10 million, while advertising expenses increased 10% to $11 million. General and administrative expenses rose 4.4% to $47 million. Depreciation and amortization expenses declined to $10 million from $11 million.
The company reported an operating loss of $2 million compared with a loss of $25 million a year earlier. Operating expenses per WSEE declined 3.4% to $227, reflecting lower corporate staffing and compensation-related costs.
Insperity's 9-Month Performance Shows Progress
For the first nine months of 2026, revenues increased 1.7% year over year to $5.23 billion. Average paid WSEEs declined 1.3% to 305,359, while revenues per WSEE increased 3% to $1,904.
Gross profit remained relatively flat at $726 million, while operating expenses declined 4.6% to $660 million. Reported net income increased 38.5% to $36 million, with earnings rising to 95 cents per share from 69 cents.
Adjusted EBITDA increased 18.1% to $170 million, while adjusted earnings rose 13.5% to $1.85 per share. These improvements reflected the cumulative benefits of the company's margin recovery initiatives.
NSP Maintains Liquidity & Shareholder Returns
Insperity ended September with $599 million in cash and cash equivalents compared with $642 million at 2025-end. Adjusted cash increased to $119 million from $57 million, while outstanding debt stood at approximately $419 million.
During the quarter, the company paid out $23 million in dividends and repurchased approximately 131,000 shares for $6 million. Capital expenditure totaled $13 million. Management continues balancing shareholder distributions with investments in technology and growth initiatives.
Insperity Updates Q4 & 2026 Outlook
For the fourth quarter of 2026, Insperity expects average paid WSEEs between 306,000 and 308,000, indicating a year-over-year decline of 1.4-2%.
Adjusted earnings are projected between 7 cents and 42 cents per share compared with an adjusted loss of 60 cents a year earlier. The midpoint (24.50 cents) of the guided range is lower than the Zacks Consensus Estimate of 28 cents.
Adjusted EBITDA is anticipated between $24 million and $44 million.
For 2026, the company forecasts adjusted earnings of $1.93-$2.28 per share compared with the preceding quarter’s view of $1.88-$2.43. The midpoint ($2.11) of the guided range is lower than the Zacks Consensus Estimate of $2.14.
Adjusted EBITDA is projected between $194 million and $214 million, indicating 48-63% growth. Average paid WSEEs are expected to be between 305,500 and 306,000.
Management expects continued pricing improvements and lower operating costs to support profitability. Meanwhile, strengthening sales activity, HRScale implementation and artificial intelligence initiatives remain central to rebuilding growth momentum in 2027.
NSP carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot
Clean Harbors (CLH - Free Report) reported strong third-quarter 2026 results, with earnings and revenues surpassing the Zacks Consensus Estimate.
Earnings of $3.93 per share beat the consensus mark of $3.18 by 23.6%. Earnings increased 77.8% year over year.
Revenues surged 20.7% year over year to $1.87 billion, beating the consensus estimate of $1.72 billion by 8.4%, as reported in the earnings data.
Fiserv (FISV - Free Report) posted better-than-expected third-quarter 2026 results, with earnings and revenues surpassing the Zacks Consensus Estimate.
Adjusted earnings of $1.75 per share beat the consensus estimate of $1.72 by 1.7% but declined 14% year over year.
Adjusted revenues of $4.85 billion surpassed the consensus mark of $4.84 billion by 0.2% but decreased 1% from the year-ago quarter.