Markets
FRO

What's in Store for Kforce (KFRC) this Earnings Season?

Staffing company Kforce Inc . KFRC is scheduled to report its fourth-quarter 2015 results after the market closes on Feb 9.

In the last reported quarter, Kforce posted a positive earnings surprise of 2.13%. Kforce has a solid earnings track record over the past few quarters, with the company beating earnings estimates in three of the trailing four quarters. The average earnings surprise over the last four quarters is 6.8%.

Let's see how things are shaping up for this announcement.

Factors to Consider

Kforce provides professional and technical specialty staffing services and solutions globally. The company is in a restructuring mode as it continues to divest non-core operations and invest the proceeds in higher-growth markets.

Kforce has been witnessing strong growth across its businesses. Highly skilled specialty staffing demand is likely to boost the company's revenues. The company expects to leverage its strong customer relationships to further penetrate and capture more of those customers and expand in the growing markets. The company's cash flow generation continues to be strong and aims to return capital to its shareholders in the form of dividends and stock repurchases.

However, the business of the company is subject to government regulations and licensing and the failure to obtain all necessary licenses or approvals could adversely affect Kforce's financial results.

For the fourth quarter, the company expects revenues to be in the range of $333 million to $338 million with earnings in the range of 43 cents to 45 cents per share.

Earnings Whispers

Our proven model does not conclusively show that Kforce will beat earnings estimates in this quarter. This is because a stock needs to have both a positive Earnings ESP (Expected Surprise Prediction) and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for this to happen. This is not the case here as you will see below.

Zacks ESP : Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is pegged at 0.00%. This is because both the Most Accurate estimate and Zacks Consensus Estimate currently stand at 44 cents.

Zacks Rank : Kforce's Zacks Rank #3, when combined with a 0.00% ESP, makes surprise prediction difficult. We caution against stocks with Zacks Ranks #4 and #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Other Stocks That Warrant a Look

Here are some companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat in the imminent future.

Assurant Inc. AIZ has an Earnings ESP of +0.65% and carries a Zacks Rank #3

Frontline Ltd. FRO has an Earnings ESP of +25.00% and holds a Zacks Rank #2.

Gener8 Maritime Inc. GNRT has an Earnings ESP of +1.52% and holds a Zacks Rank #1.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days . Click to get this free report >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

FRONTLINE LTD (FRO): Free Stock Analysis Report

ASSURANT INC (AIZ): Free Stock Analysis Report

KFORCE INC (KFRC): Free Stock Analysis Report

GENER8 MARITIME (GNRT): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

FRO KFRC AIZ

Other Topics

Earnings Stocks

Latest Markets Videos

    Zacks

    Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

    Learn More