In this article, we will discuss the 5 best staffing company stocks to buy now. If you want to explore similar stocks, you can read 10 Best Staffing Company Stocks To Buy Now.
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 (NYSE:KFY) is trading at a PE multiple of 8x and is offering a forward dividend yield of 1.15%.
On September 7, Korn Ferry (NYSE:KFY) 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 (NYSE:KFY) 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 (NYSE:KFY) 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. (NYSE:TNET) is undervalued and, as of October 26, has a trailing twelve-month PE ratio of 12.86.
On October 25, TriNet Group, Inc. (NYSE:TNET) 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. (NYSE:TNET) 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. (NYSE:TNET) 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. (NYSE:TNET) 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. (NYSE:TNET) and has a stake worth $277.5 million in the company.
3. Paychex, Inc. (NASDAQ:PAYX)
Number of Hedge Fund Holders: 37
Paychex, Inc. (NASDAQ:PAYX) 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. (NASDAQ:PAYX) 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. (NASDAQ:PAYX) 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. (NASDAQ:PAYX) 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. (NASDAQ:PAYX) 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. (NASDAQ:PAYX) and held stakes worth $678.5 million in the company. Of those, Select Equity Group was the top investor in Paychex, Inc. (NASDAQ:PAYX) and disclosed stakes of $243.6 million in the company.
2. Workday, Inc. (NYSE:WDAY)
Number of Hedge Fund Holders: 71
Workday, Inc. (NYSE:WDAY) 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. (NYSE:WDAY) 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. (NYSE:WDAY). This September, Canaccord analyst David Hynes maintained a Buy rating and his $200 price target on Workday, Inc. (NYSE:WDAY).
At the end of Q2 2022, 71 hedge funds disclosed ownership of stakes in Workday, Inc. (NYSE:WDAY). 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. (NYSE:WDAY) and has stakes worth $700.5 million in the company.
Here is what RiverPark Funds had to say about Workday, Inc. (NYSE:WDAY) 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 (NASDAQ:MSFT) 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 (NASDAQ:MSFT) 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 (NASDAQ:MSFT) 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 (NASDAQ:MSFT) 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 (NASDAQ:MSFT). 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 (NASDAQ:MSFT) and has stakes of $7.36 billion in the company.
Here is what Lakehouse Capital had to say about Microsoft Corporation (NASDAQ:MSFT) 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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