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Korn/Ferry International (KFY) Hits a 52-Week High, Can the Run Continue?
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Have you been paying attention to shares of Korn/Ferry International (KFY - Free Report) ? Shares have been on the move with the stock up 6.3% over the past month. KFY hit a new 52-week high of $56.18 in the previous session. Korn/Ferry International has gained 35.2% since the start of the year compared to the 8.7% move for the Business Services sector and the 4.2% year-to-date return for its peer group.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on March 6, 2018, Korn/Ferry International reported EPS of $0.7 versus the Zacks Consensus Estimate of $0.59 while it beat the consensus revenue estimate by 7.46%.
For the current fiscal year, Korn/Ferry International is expected to post earnings of $3.05 per share on $1.75 billion in revenues. Meanwhile, for the next fiscal year, the company is expected to earn $3.53 per share on $1.85 billion in revenues. This represents a year-over-year change of 15.97% and 5.7%, respectively.
Valuation Metrics
While KFY has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Korn/Ferry International has a Value Score of C. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 18.3X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 18.2X versus its peer group's average of 13.2X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Korn/Ferry International currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 and Style Scores of A or B, it looks as if Korn/Ferry International meets the list of requirements. Thus, it seems as though KFY shares could have a bit more room to run in the near term.
How Does Korn/Ferry International Stack Up to the Competition?
Shares of Korn/Ferry International have been moving higher, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also looking good, including Kforce (KFRC - Free Report) , Robert Half International (RHI - Free Report) , and Maximus (MMS - Free Report) , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 17% of all the industries we have in our universe, so it looks like there are some nice tailwinds for KFY, even beyond its own solid fundamental situation.
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Korn/Ferry International (KFY) Hits a 52-Week High, Can the Run Continue?
Have you been paying attention to shares of Korn/Ferry International (KFY - Free Report) ? Shares have been on the move with the stock up 6.3% over the past month. KFY hit a new 52-week high of $56.18 in the previous session. Korn/Ferry International has gained 35.2% since the start of the year compared to the 8.7% move for the Business Services sector and the 4.2% year-to-date return for its peer group.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on March 6, 2018, Korn/Ferry International reported EPS of $0.7 versus the Zacks Consensus Estimate of $0.59 while it beat the consensus revenue estimate by 7.46%.
For the current fiscal year, Korn/Ferry International is expected to post earnings of $3.05 per share on $1.75 billion in revenues. Meanwhile, for the next fiscal year, the company is expected to earn $3.53 per share on $1.85 billion in revenues. This represents a year-over-year change of 15.97% and 5.7%, respectively.
Valuation Metrics
While KFY has moved to its 52-week high in the recent past, investors need to be asking, what is next for the company? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Korn/Ferry International has a Value Score of C. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 18.3X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 18.2X versus its peer group's average of 13.2X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Korn/Ferry International Price and Consensus
Korn/Ferry International Price and Consensus | Korn/Ferry International Quote
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Korn/Ferry International currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 and Style Scores of A or B, it looks as if Korn/Ferry International meets the list of requirements. Thus, it seems as though KFY shares could have a bit more room to run in the near term.
How Does Korn/Ferry International Stack Up to the Competition?
Shares of Korn/Ferry International have been moving higher, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also looking good, including Kforce (KFRC - Free Report) , Robert Half International (RHI - Free Report) , and Maximus (MMS - Free Report) , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 17% of all the industries we have in our universe, so it looks like there are some nice tailwinds for KFY, even beyond its own solid fundamental situation.