We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Insperity, Inc. (NSP - Free Report) reported decent second-quarter 2019 results, wherein earnings matched the Zacks Consensus Estimate and revenues surpassed the same.
Adjusted earnings of 83 cents per share came in line with the consensus mark and increased 22.1% year over year. The reported figure lies within the guided range of 81-86 cents per share.
Total revenues of $1.04 billion beat the consensus estimate by $3.8 million and increased 13.1% year over year on the back of 13.8% increase in average number of worksite employees (WSEEs) paid per month. Average number of worksite employees paid per month was 232,010 at the end of the reported quarter.
In the reported quarter, worksite employee growth stemmed from new client sales driven by an 11% increase in average number of Business Performance Advisors and higher client retention (whereinretention rate was more than 99%). Net gains in client base declined due to less hiring of full-time and seasonal employees.
So far this year, shares of Insperity have gained 12.9% compared with 11.9% rise of the industry it belongs to.
Operating Results
Gross profit of $173.74 million increased 12.4% from the year-ago quarter on the back of favorable claims development in workers’ compensation program and higher pricing, which was partially offset by higher-than-expected benefits costs (driven by large claim activity). Gross margin of 19.7% remained flat year over year. Gross profit per worksite employee per month decreased 1.2% year over year to $250.
Adjusted EBITDA was up 21.6% year over year to $56.69 million. Adjusted EBITDA per worksite employee per month increased 6.6% to $81.
Adjusted operating expenses increased 11.6% year over year to $135.02 million.
Operating income increased 15.3% year over year to $38.72 million. Operating income per worksite employee per month increased 1.8% to $56.
Balance Sheet & Cash Flow
Insperity exited second-quarter 2019 with adjusted cash, cash equivalents and marketable securities of $130.66 million compared with $140.51 million at the end of the prior quarter. Long-term debt amounted to $169.40 million compared with $144.40 million at the end of the previous quarter.
In the reported quarter, the company repurchased 85,000 shares for $10 million and paid dividends totaling $12.7 million.
Q3 Guidance
For third-quarter 2019, Insperity projects adjusted earnings in the range of $1.00-$1.04 per share, indicating a year-over-year increase of 4-8%. The current Zacks Consensus Estimate of $1.05 lies within the guided range.
Adjusted EBITDA is anticipated to increase 8-12% to a range of $66.5-$69 million. Average WSEEs is expected in the range of 243,000-244,100, indicating 13-13.5% growth.
2019 Guidance
For the full year, Insperity updated its guidance for adjusted EPS, adjusted EBITDA and average WSEs.
The company now projects adjusted earnings in the band of $4.59-$4.74 per share (indicating growth of 22-26%) compared with the previously guided range of $4.55-$4.80 per share (which indicated growth of 21-28%). The current Zacks Consensus Estimate of $4.68 lies within the guided range.
Adjusted EBITDA is now anticipated to grow 16-19% to a range of $278-$286 million compared with the previously guided range of $276-$289 million (which indicated 15-21% growth).
Average WSEEs are expected to grow 13.5-14.5% to a range of 237,350–239,500 compared with the previously guided range of 238,400-242,600, indicating 14-16% growth.
Investors interested in the broader Zacks Business Services sector are awaiting second-quarter 2019 results of key players like Genpact (G - Free Report) , Green Dot (GDOT - Free Report) and Navigant Consulting (NCI - Free Report) . While Genpact and Green Dot are slated to report on Aug 7, Navigant Consulting is scheduled to release results on Aug 8.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +98%, +119% and +164% in as little as 1 month. The stocks in this report could perform even better.
Image: Bigstock
Insperity (NSP) Meets Q2 Earnings Estimates, Tweaks 2019 View
Insperity, Inc. (NSP - Free Report) reported decent second-quarter 2019 results, wherein earnings matched the Zacks Consensus Estimate and revenues surpassed the same.
Adjusted earnings of 83 cents per share came in line with the consensus mark and increased 22.1% year over year. The reported figure lies within the guided range of 81-86 cents per share.
Total revenues of $1.04 billion beat the consensus estimate by $3.8 million and increased 13.1% year over year on the back of 13.8% increase in average number of worksite employees (WSEEs) paid per month. Average number of worksite employees paid per month was 232,010 at the end of the reported quarter.
In the reported quarter, worksite employee growth stemmed from new client sales driven by an 11% increase in average number of Business Performance Advisors and higher client retention (whereinretention rate was more than 99%). Net gains in client base declined due to less hiring of full-time and seasonal employees.
So far this year, shares of Insperity have gained 12.9% compared with 11.9% rise of the industry it belongs to.
Operating Results
Gross profit of $173.74 million increased 12.4% from the year-ago quarter on the back of favorable claims development in workers’ compensation program and higher pricing, which was partially offset by higher-than-expected benefits costs (driven by large claim activity). Gross margin of 19.7% remained flat year over year. Gross profit per worksite employee per month decreased 1.2% year over year to $250.
Adjusted EBITDA was up 21.6% year over year to $56.69 million. Adjusted EBITDA per worksite employee per month increased 6.6% to $81.
Adjusted operating expenses increased 11.6% year over year to $135.02 million.
Insperity, Inc. Price, Consensus and EPS Surprise
Insperity, Inc. price-consensus-eps-surprise-chart | Insperity, Inc. Quote
Operating income increased 15.3% year over year to $38.72 million. Operating income per worksite employee per month increased 1.8% to $56.
Balance Sheet & Cash Flow
Insperity exited second-quarter 2019 with adjusted cash, cash equivalents and marketable securities of $130.66 million compared with $140.51 million at the end of the prior quarter. Long-term debt amounted to $169.40 million compared with $144.40 million at the end of the previous quarter.
In the reported quarter, the company repurchased 85,000 shares for $10 million and paid dividends totaling $12.7 million.
Q3 Guidance
For third-quarter 2019, Insperity projects adjusted earnings in the range of $1.00-$1.04 per share, indicating a year-over-year increase of 4-8%. The current Zacks Consensus Estimate of $1.05 lies within the guided range.
Adjusted EBITDA is anticipated to increase 8-12% to a range of $66.5-$69 million. Average WSEEs is expected in the range of 243,000-244,100, indicating 13-13.5% growth.
2019 Guidance
For the full year, Insperity updated its guidance for adjusted EPS, adjusted EBITDA and average WSEs.
The company now projects adjusted earnings in the band of $4.59-$4.74 per share (indicating growth of 22-26%) compared with the previously guided range of $4.55-$4.80 per share (which indicated growth of 21-28%). The current Zacks Consensus Estimate of $4.68 lies within the guided range.
Adjusted EBITDA is now anticipated to grow 16-19% to a range of $278-$286 million compared with the previously guided range of $276-$289 million (which indicated 15-21% growth).
Average WSEEs are expected to grow 13.5-14.5% to a range of 237,350–239,500 compared with the previously guided range of 238,400-242,600, indicating 14-16% growth.
Zacks Rank & Upcoming Releases
Currently, Insperity carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Investors interested in the broader Zacks Business Services sector are awaiting second-quarter 2019 results of key players like Genpact (G - Free Report) , Green Dot (GDOT - Free Report) and Navigant Consulting (NCI - Free Report) . While Genpact and Green Dot are slated to report on Aug 7, Navigant Consulting is scheduled to release results on Aug 8.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +98%, +119% and +164% in as little as 1 month. The stocks in this report could perform even better.
See these 7 breakthrough stocks now>>