In this article, we will discuss the 10 best staffing company stocks to buy now.
The global staffing industry has gone through a significant transformation over recent years with advancements in IoT, artificial intelligence, and data analytics. According to Staffing Industry Analysts, the global staffing industry generated a revenue of $599 billion in 2021, up 21% year over year, and is on track to grow its revenue by 9% in 2022. According to a report by SkyQuest, the global human resource technology market was worth $24 billion in 2021 and is expected to reach a value of roughly $36 billion by 2028, at a compound annual growth rate of 5.8%. According to a survey carried out by SkyQuest, 81% of medium-sized and large-sized businesses reported that they use HR software, and 79% of the respondents reported that HR software has helped them optimize their reviews.
The staffing industry is on track to benefit from secular growth trends, such as the adoption of artificial intelligence and advanced analytics in human resource management, and exhibit strong growth. Investors can cash in on the opportunity and rack up shares of top staffing companies which include Paychex, Inc. (NASDAQ:PAYX), Workday, Inc. (NYSE:WDAY), and Microsoft Corporation (NASDAQ:MSFT) and position themselves to benefit from this secular growth industry.
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Our Methodology
To determine the best staffing company stocks to buy now, we reviewed the global staffing industry and identified key players in the space. We picked companies with strong product pipelines, leading market positions, and attractive growth catalysts. Along with each stock, we have mentioned the hedge fund sentiment, analyst ratings, and top shareholders. We have ranked these stocks according to their popularity among elite investor circles.
Best Staffing Company Stocks To Buy Now
10. Hudson Global, Inc. (NASDAQ:HSON)
Number of Hedge Fund Holders: 4
Hudson Global, Inc. (NASDAQ:HSON) is a leading international provider of professional staffing and recruiting services. The company has operations across North America, Europe, Asia Pacific, and South America. Hudson Global, Inc. has a strong track record of delivering high-quality candidates to clients and has a deep understanding of the global talent market. The company’s innovative staffing solutions and use of technology have helped it to become a leading player in the industry. Hudson Global, Inc. is well-positioned to capitalize on the growing demand for professional staffing services globally.
Hudson Global, Inc. is trading at an attractive valuation and ranks among the best staffing stocks to buy now. As of October 26, the stock has a trailing twelve-month PE ratio of 11.09 and has gained 110% over the past twelve months.
At the close of Q2 2022, 4 hedge funds held stakes in Hudson Global, Inc.. The total value of these stakes amounted to $6.1 million. This is compared to 3 positions in the previous quarter with stakes of $7.5 million. As of June 30, Renaissance Technologies is the largest shareholder in Hudson Global, Inc. and has stakes worth $3.1 million in the company.
Some of the best-in-class companies operating in the staffing industry include Paychex, Inc., Workday, Inc., and Microsoft Corporation.
9. HireQuest, Inc. (NASDAQ:HQI)
Number of Hedge Fund Holders: 5
HireQuest, Inc. (NASDAQ:HQI) is a leading provider of on-demand labor and staffing solutions in the United States, with a nationwide network of branches. The company offers a flexible and convenient solution for businesses of all sizes that need skilled workers for a variety of positions, including industrial, commercial, and construction. HireQuest, Inc. has a proven track record of success, with over 20 years of experience and a strong reputation in the industry. The company is well-positioned for continued growth and expansion, with a robust franchise system and a strong management team.
On September 13, EF Hutton analyst Michael Albanese took coverage of HireQuest, Inc. with a Buy rating and a $24 price target. As of October 26, the stock is trading at a PE multiple of 18x and is offering a forward dividend yield of 1.68%.
At the end of Q2 2022, 5 hedge funds were long HireQuest, Inc. and held stakes worth $6.28 million in the company. This is compared to 3 positions in the previous quarter with stakes worth $5.21 million. The hedge fund sentiment for the stock is positive.
Here is what Rhizome Partners had to say about HireQuest, Inc. in its second-quarter 2022 investor letter:
“Our smaller positions in both HireQuest and Cross Country Healthcare are trading around 10 times normalized P/FCF multiples. Both companies have long growth runways and are led by talented CEOs. The ongoing maintenance capital expenditures of both companies are minimal. We keep looking for ways to disprove both investment theses and have a hard time coming up with valid reasons. HireQuest is more cyclical because it’s tied to blue collar temporary staffing. But HireQuest has the unique know-how to acquire staffing companies and convert them into high-performing franchises. HireQuest has consistently paid about 5 times P/FCF multiple for the acquisitions. Adjusting for sales of branches locations to franchisees, the P/FCF multiple falls even further. The current acquisition strategy is better than a greenfield approach as the acquired free cashflow yield is over 20% and HireQuest does not have to compete for market share. We believe the company can grow to five times its current size, with little share-count dilution.”
8. Heidrick & Struggles International, Inc. (NASDAQ:HSII)
Number of Hedge Fund Holders: 13
Heidrick & Struggles International, Inc. is a global provider of executive search, on-demand talent, and leadership consulting services. The company helps its clients build great companies and leaders. The company has a long history of success and a strong track record of creating value for its shareholders. The company’s diversified business model and strong global presence justify its inclusion among the best staffing stocks to invest in.
On October 24, Heidrick & Struggles International, Inc. declared a quarterly cash dividend of $0.15 per common share. The dividend is payable on November 18 to shareholders of record at the close of business on November 4. As of October 26, Heidrick & Struggles International, Inc. is trading at a PE multiple of 7x and is awarding investors with a dividend yield of 2.08%.
As of July 28, Barrington analyst Kevin Steinke has a $45 price target and Outperform rating on Heidrick & Struggles International, Inc..
At the close of Q2 2022, 13 hedge funds were bullish on Heidrick & Struggles International, Inc. and held stakes worth $98.3 million in the company. Of those, Renaissance Technologies was the top investor in the company and disclosed a stake of $42.2 million.
7. Trueblue, Inc. (NYSE:TBI)
Number of Hedge Fund Holders: 14
Trueblue, Inc. (NYSE:TBI) is a leading provider of contingent staffing solutions in the United States. The company has a diversified customer base and a large network of branches across the country. Trueblue, Inc. is trading at bargain levels and offering investors the opportunity to cash in on the weakness. As of October 26, the stock is trading at a PE multiple of 10x. Trueblue, Inc. is among the best staffing stocks to invest in right now.
On October 24, Trueblue, Inc. announced earnings for the fiscal third quarter of 2022. The company generated a revenue of $575.72 million and reported earnings per share of $0.63, outperforming Wall Street estimates by $0.03. Shortly after the company’s earnings release, Baird analyst Mark Marcon raised his price target on TrueBlue, Inc. to $28 from $21 and maintained an Outperform rating on the shares.
At the end of Q2 2022, 14 hedge funds disclosed ownership of stakes in Trueblue, Inc.. These funds held collective stakes of $61.6 million in the company. As of June 30, Pzena Investment Management is the leading shareholder in Trueblue, Inc. and has stakes worth $32 million in the company.
In addition to Trueblue, Inc., investors looking to gain exposure to the staffing industry can also explore Paychex, Inc., Workday, Inc., and Microsoft Corporation.
6. ASGN Incorporated (NYSE:ASGN)
Number of Hedge Fund Holders: 19
ASGN Incorporated (NYSE:ASGN) is a leading provider of in-demand, skilled professionals in the technology, digital, and creative fields for both commercial and government sectors. With over 35 years of experience, ASGN Incorporated has a proven track record of connecting talented professionals with great companies and has made itself a trusted partner for both job seekers and businesses. The stock is ranked among the best staffing stocks to buy now.
This July, BMO Capital analyst Jeffrey Silber raised his price target on ASGN Incorporated to $105 from $94 and maintained a Market Perform rating on the shares. On August 8, BofA analyst Heather Balsky raised her price target on ASGN Incorporated to $122 from $120 and reiterated a Buy rating on the shares.
At the end of Q2 2022, 19 hedge funds were long ASGN Incorporated and held stakes worth $62.5 million in the company. This is compared to 12 positions in the previous quarter with stakes of $40.1 million. The hedge fund sentiment for the stock is positive. As of June 30, AQR Capital Management is the most prominent investor in ASGN Incorporated and has a stake of $13.2 million in the company.
Here is what Baron Funds had to say about ASGN Incorporated in its second-quarter 2022 investor letter:
“ASGN Incorporated (NYSE:ASGN) is a leading provider of IT staffing and consulting services. We expect continued robust demand for ASGN’s solutions given its focus on staffing areas with strong secular growth, chronic shortages of skilled IT workers, and the ongoing digital transformation of U.S. businesses. ASGN is better insulated from economic headwinds than traditional staffing providers given its significant exposure to more stable, counter-cyclical government work and the mission-critical nature of its IT infrastructure work and longer-term consulting engagements.
Management is not seeing any change in tone from its clients, demand remains strong, and pipeline growth is still accelerating. Wage inflation is being offset by higher billing rates, which are being successfully passed through to customers. ASGN is rapidly expanding its solution capabilities, which in turn expands the scope of work for which it can compete and presents new cross-selling opportunities. The company is tracking ahead of its three-year $6 billion revenue target (including $4.9 billion organic revenue growth) which was set just this past September.
We believe investors do not appreciate ASGN’s differentiated positioning and remain optimistic about the outlook for the company. Trading at around 8.5 times 2023 adjusted cash flow, we think the shares are incredibly cheap.”
5. Korn Ferry (NYSE:KFY)
Number of Hedge Fund Holders: 21
Korn Ferry (NYSE:KFY) has a long history of success in the executive search industry and is well-positioned to capitalize on continued growth in the sector. The company has a strong brand and a global presence. The stock is trading at an attractive valuation and is ranked high among the best staffing stocks to buy now. As of October 26, Korn Ferry is trading at a PE multiple of 8x and is offering a forward dividend yield of 1.15%.
On September 7, Korn Ferry announced earnings for the fiscal first quarter of 2023. The company reported earnings per share of $1.50 and generated a revenue of $695.90 million, up 18.88% year over year. On September 8, Baird analyst Mark Marcon revised his price target on Korn Ferry to $64 from $72 and reiterated an Outperform rating on the shares.
At the close of Q2 2022, 21 hedge funds were eager on Korn Ferry and held stakes worth $210.5 million in the company. Of those, Ariel Investments was the top shareholder in the company and disclosed stakes of $50 million.
4. TriNet Group, Inc. (NYSE:TNET)
Number of Hedge Fund Holders: 23
TriNet Group, Inc. (NYSE:TNET) is a leading provider of comprehensive human resources solutions for small to midsize businesses (SMBs). The company provides benefits, payroll, and HR solutions that are designed to meet the unique needs of SMBs. The company has a strong track record of growth and profitability and is one of the best staffing stocks to buy now. TriNet Group, Inc. is undervalued and, as of October 26, has a trailing twelve-month PE ratio of 12.86.
On October 25, TriNet Group, Inc. announced market-beating earnings for the third quarter of fiscal 2023. The company reported earnings per share of $1.64 and outperformed consensus by $0.62. The company’s revenue for the quarter amounted to $369 million, up 24.24% year over year, and came in ahead of expectations by $66.48 million.
This October, Credit Suisse analyst Kevin McVeigh revised his price target on TriNet Group, Inc. to $85 from $90 and maintained a Neutral rating on the shares. On October 26, Cowen analyst Jared Levine adjusted his price target on TriNet Group, Inc. to $70 from $75 and reiterated a Market Perform rating on the shares.
At the end of Q2 2022, 23 hedge funds were bullish on TriNet Group, Inc. and held stakes worth $464.8 million in the company. As of June 30, Cantillon Capital Management is the top shareholder in TriNet Group, Inc. and has a stake worth $277.5 million in the company.
3. Paychex, Inc. (NASDAQ:PAYX)
Number of Hedge Fund Holders: 37
Paychex, Inc. is a leading provider of payroll and human resource solutions for small- and medium-sized businesses. The company offers a comprehensive suite of services, including payroll processing, human resource management, and benefits administration. Paychex, Inc. has a long track record of delivering quality services and has a strong reputation in the industry. The company has a strong cash position and is awarding stockholders with a hefty dividend. Paychex, Inc. ranks among the 5 best staffing stocks to invest in now and has free cash flows of $1.35 billion. The stock is offering a forward dividend yield of 2.77% to investors, as of October 26.
On September 29, Credit Suisse analyst Kevin McVeigh revised his price target on Paychex, Inc. to $138 from $150 and maintained an Outperform rating on the shares. This September, Cowen analyst Bryan Bergin raised his price target on Paychex, Inc. to $132 from $125 and reiterated an Outperform rating on the shares.
At the close of Q2 2022, 37 hedge funds were eager on Paychex, Inc. and held stakes worth $678.5 million in the company. Of those, Select Equity Group was the top investor in Paychex, Inc. and disclosed stakes of $243.6 million in the company.
2. Workday, Inc. (NYSE:WDAY)
Number of Hedge Fund Holders: 71
Workday, Inc. is a leading provider of enterprise cloud applications in the United States and internationally. The company offers a comprehensive Human Capital Management suite that allows businesses to manage the entire employee lifecycle from recruitment to retirement. The company has exposure to a variety of industries including professional & business services, financial services, healthcare, education, government, technology, media, retail, and hospitality. Workday, Inc. has a strong cash position and a leading industry position, which justifies its ranking among the best staffing stocks to buy now. The company has free cash flows of over $1.2 billion.
On September 14, Morgan Stanley analyst Keith Weiss reiterated an Overweight rating and his $282 price target on Workday, Inc.. This September, Canaccord analyst David Hynes maintained a Buy rating and his $200 price target on Workday, Inc..
At the end of Q2 2022, 71 hedge funds disclosed ownership of stakes in Workday, Inc.. The total value of these stakes amounted to $3.71 billion. As of June 30, Lone Pine Capital is the leading investor in Workday, Inc. and has stakes worth $700.5 million in the company.
Here is what RiverPark Funds had to say about Workday, Inc. in its third-quarter 2022 investor letter:
“We also added a small position in Workday this quarter, taking advantage of its 2022 price decline. WDAY is a leading SaaS software solutions provider with two key subparts: Workday HCM offering end-to-end software for human resource departments, and Workday Financial Management for planning, spending, auditing, analytics, and reporting. The company sells to more than 9,500 medium-sized through enterprise customers across more than 175 countries, including more than 50% of the Fortune 500.
The company is benefitting from the secular shift to digitization for businesses and despite its 21% annual subscription revenue CAGR over the past 2 years (with 95%+ gross revenue retention), Workday still has less than 5% penetration of its $105 billion TAM. We believe the company can grow its top-line high-teens over the long-term, while continuing to improve margins (non-GAAP gross operating margin expanded 900 basis points to 22.4% over the past two years), leading to approximately 30% EPS growth for the foreseeable future. The company also requires limited capital expenditures, producing significant and growing FCF ($1.4b last year, up 37% year over year), which WDAY has used for acquisitions and debt repayment.”
1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 258
Microsoft Corporation purchased LinkedIn back in 2016 for over $26 billion. LinkedIn is one of the largest and best platforms for professional networking and talent acquisition and is used by businesses of all sizes across the world. On October 25, Microsoft Corporation reported earnings for the fiscal first quarter of 2023. The company reported a revenue of $50.1 billion, up 10.60% year over year. The company’s LinkedIn division reported a revenue increase of 17% year over year.
Shortly after the company’s earnings release, Morgan Stanley analyst Keith Weiss revised his price target on Microsoft Corporation to $307 from $325 and maintained an Overweight rating on the shares. This October, Oppenheimer analyst Timothy Horan adjusted his price target on Microsoft Corporation to $265 from $275 and reiterated an Outperform rating on the shares.
At the close of Q2 2022, 258 hedge funds held stakes in Microsoft Corporation. These funds held collective stakes of $56 billion in the company. As of June 30, Fisher Asset Management is the top investor in Microsoft Corporation and has stakes of $7.36 billion in the company.
Here is what Lakehouse Capital had to say about Microsoft Corporation in its September 2022 investor letter:
“During the month, the Fund initiated a new position in Microsoft Corporation (NASDAQ:MSFT), a name that is no doubt familiar to our investors. The company was founded by Bill Gates and Paul Allen in a friend’s garage in 1975 and began dominating the operating system market with MS-DOS by the mid-1980s. The company has come a long way since then and is now widely considered the most critical and indispensable IT mega-vendor for businesses globally. In addition to its well-known Windows operating systems and Office productivity suite, the company has a broad portfolio of strategic products, including a rapidly growing public cloud business in Azure and a sizeable gaming presence.
Microsoft’s foundational products, Office365 and Windows365, are ubiquitous and highly penetrated with circa 90% and 80% market share, respectively. These solutions are deeply ingrained in commercial and personal use globally and across all industry sectors. They serve as stable, high-margin cash flow generators for Microsoft whilst they expand and invest in other growth areas of the business. One particular growth area, which is the most exciting part of Microsoft’s business in our view, is their public cloud service, Azure.
Azure has grown at a rapid clip over the past decade to cement itself as the second-largest cloud service provider globally, behind Amazon Web Services. The business benefits from strong secular tailwinds as cloud adoption continues unabated and there is considerable runway ahead – it’s currently estimated that less than 20% of global IT spend is currently in the cloud. Research indicates that 80% of enterprises use Azure and its market share has grown to 21%, up from 13% five years ago. The mission-critical nature of the product, which is similar to many of Microsoft’s other solutions, is incredibly attractive as it leads to sticky, recurring revenue streams. Something we love to see…” (Click here to read the full text)
You can also take a look at 12 Best Value Dividend Stocks To Invest In and 10 Best Undervalued Dividend Stocks To Buy.
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