Barrett Business Services (NASDAQ:BBSI – Get Free Report) announced its earnings results on Wednesday. The business services provider reported $0.69 earnings per share for the quarter, meeting the consensus estimate of $0.69, Zacks reports. Barrett Business Services had a return on equity of 19.73% and a net margin of 2.44%. The company had revenue of $334.06 million during the quarter, compared to the consensus estimate of $335.89 million.
Here are the key takeaways from Barrett Business Services’ conference call:
- Revenue and gross billings grew 5% and 3%, respectively, while PEO worksite employees rose 1%. Strong new-client additions—including about 3,100 net WSEs year over year—were partly offset by workforce reductions at existing clients.
- BBSI lowered its full-year average WSE growth outlook to 1%–2%, from 2%–3%, citing continued softness in client hiring. It still expects gross billings growth of 3%–4%, but now expects gross margin to land toward the low end of its 2.7%–2.75% range.
- Third-quarter diluted EPS fell to $0.69 from $0.79 a year earlier. Favorable workers’ compensation adjustments declined to $0.8 million from $3.9 million, weighing on year-over-year gross margin comparisons, although management said current pricing increases are more than offsetting current-year cost increases.
- BBSI Benefits gained about 70 clients and 1,500 participants in the quarter; submissions rose roughly 30% year over year, and October submissions for January 2027 transactions were up about 55%. Management said it is encouraged by the selling-season activity, while noting it is still early.
- The company reported $74 million in unrestricted cash and investments and no debt, and returned more than $50 million to shareholders over the first nine months of the year through dividends and buybacks. It also continues investing in technology and geographic expansion.
Barrett Business Services Trading Down 1.4%
Barrett Business Services stock traded down $0.42 on Friday, reaching $29.96. 57,290 shares of the stock were exchanged, compared to its average volume of 232,490. The stock has a market cap of $726.20 million, a PE ratio of 23.70, a PEG ratio of 1.23 and a beta of 0.93. The firm has a fifty day moving average price of $32.50 and a two-hundred day moving average price of $32.89. Barrett Business Services has a twelve month low of $25.33 and a twelve month high of $42.25.
Barrett Business Services Dividend Announcement
The business also recently disclosed a quarterly dividend, which will be paid on Friday, December 4th. Investors of record on Friday, November 20th will be paid a $0.08 dividend. This represents a $0.32 dividend on an annualized basis and a dividend yield of 1.1%. The ex-dividend date of this dividend is Friday, November 20th. Barrett Business Services’s dividend payout ratio (DPR) is presently 25.40%.
Analyst Ratings Changes
Several equities research analysts recently weighed in on BBSI shares. Roth Capital downgraded shares of Barrett Business Services from a “buy” rating to a “neutral” rating and reduced their price objective for the stock from $42.00 to $38.00 in a report on Thursday, August 6th. Zacks Research upgraded Barrett Business Services from a “strong sell” rating to a “hold” rating in a research report on Monday, October 5th. Weiss Ratings reaffirmed a “hold (c)” rating on shares of Barrett Business Services in a research note on Friday, October 9th. Citigroup reiterated an “outperform” rating on shares of Barrett Business Services in a research report on Thursday, August 6th. Finally, Barrington Research set a $44.00 price target on Barrett Business Services in a research report on Thursday, August 6th. One equities research analyst has rated the stock with a Strong Buy rating, two have given a Buy rating and three have given a Hold rating to the company. According to data from MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus target price of $41.00.
Check Out Our Latest Stock Analysis on BBSI
About Barrett Business Services
Barrett Business Services, Inc (BBSI) provides business management solutions for small and mid-sized companies in the United States. Its services are designed to help clients manage administrative responsibilities and improve operational efficiency while allowing them to focus on their core businesses.
The company operates primarily through a professional employer organization (PEO) model, providing payroll administration, human resources support, employee benefits administration, workers’ compensation services, and risk management.
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