KELLY SERVICES INC -A (KELYA) Stock Fundamental Analysis
NASDAQ:KELYA - Nasdaq - US4881522084 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to KELYA. KELYA was compared to 81 industry peers in the Professional Services industry. While KELYA seems to be doing ok healthwise, there are quite some concerns on its profitability. KELYA is valued quite cheap, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year KELYA was profitable.
KELYA had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: KELYA reported negative net income in multiple years.
Of the past 5 years KELYA 4 years had a positive operating cash flow.
1.2 Ratios
KELYA's Return On Assets of -0.78% is on the low side compared to the rest of the industry. KELYA is outperformed by 67.90% of its industry peers.
KELYA has a worse Return On Equity (-1.63%) than 69.14% of its industry peers.
KELYA has a Return On Invested Capital (3.31%) which is comparable to the rest of the industry.
KELYA had an Average Return On Invested Capital over the past 3 years of 3.33%. This is significantly below the industry average of 12.78%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.78% | ||
| ROE | -1.63% | ||
| ROIC | 3.31% |
ROA(3y)-0.33%
ROA(5y)0.31%
ROE(3y)-0.73%
ROE(5y)0.68%
ROIC(3y)3.33%
ROIC(5y)2.79%
1.3 Margins
KELYA's Operating Margin of 1.67% is on the low side compared to the rest of the industry. KELYA is outperformed by 61.73% of its industry peers.
In the last couple of years the Operating Margin of KELYA has remained more or less at the same level.
Looking at the Gross Margin, with a value of 20.52%, KELYA is doing worse than 74.07% of the companies in the same industry.
In the last couple of years the Gross Margin of KELYA has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.67% | ||
| PM (TTM) | N/A | ||
| GM | 20.52% |
OM growth 3Y14.85%
OM growth 5Y-0.87%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.86%
GM growth 5Y2.42%
2. Health
2.1 Basic Checks
KELYA has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, KELYA has less shares outstanding
Compared to 5 years ago, KELYA has less shares outstanding
KELYA has a worse debt/assets ratio than last year.
2.2 Solvency
KELYA has an Altman-Z score of 2.90. This is not the best score and indicates that KELYA is in the grey zone with still only limited risk for bankruptcy at the moment.
KELYA has a Altman-Z score of 2.90. This is comparable to the rest of the industry: KELYA outperforms 53.09% of its industry peers.
KELYA has a debt to FCF ratio of 3.08. This is a good value and a sign of high solvency as KELYA would need 3.08 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 3.08, KELYA is doing good in the industry, outperforming 61.73% of the companies in the same industry.
A Debt/Equity ratio of 0.16 indicates that KELYA is not too dependend on debt financing.
The Debt to Equity ratio of KELYA (0.16) is better than 61.73% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.16 | ||
| Debt/FCF | 3.08 | ||
| Altman-Z | 2.9 |
ROIC/WACC0.38
WACC8.82%
2.3 Liquidity
KELYA has a Current Ratio of 1.64. This is a normal value and indicates that KELYA is financially healthy and should not expect problems in meeting its short term obligations.
KELYA has a Current ratio of 1.64. This is in the better half of the industry: KELYA outperforms 62.96% of its industry peers.
A Quick Ratio of 1.64 indicates that KELYA should not have too much problems paying its short term obligations.
KELYA has a better Quick ratio (1.64) than 62.96% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.64 | ||
| Quick Ratio | 1.64 |
3. Growth
3.1 Past
The earnings per share for KELYA have decreased by -9.36% in the last year.
KELYA shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 1.26% yearly.
KELYA shows a decrease in Revenue. In the last year, the revenue decreased by -3.49%.
KELYA shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -4.15% yearly.
EPS 1Y (TTM)-9.36%
EPS 3Y15.06%
EPS 5Y1.26%
EPS Q2Q%-30.36%
Revenue 1Y (TTM)-3.49%
Revenue growth 3Y-4.09%
Revenue growth 5Y-4.15%
Sales Q2Q%11.46%
3.2 Future
KELYA is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.73% yearly.
Based on estimates for the next years, KELYA will show a small growth in Revenue. The Revenue will grow by 5.63% on average per year.
EPS Next Y-0.92%
EPS Next 2Y11.73%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year7.15%
Revenue Next 2Y5.63%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 5.51, the valuation of KELYA can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of KELYA indicates a rather cheap valuation: KELYA is cheaper than 92.59% of the companies listed in the same industry.
KELYA's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.19.
A Price/Forward Earnings ratio of 4.09 indicates a rather cheap valuation of KELYA.
Compared to the rest of the industry, the Price/Forward Earnings ratio of KELYA indicates a rather cheap valuation: KELYA is cheaper than 96.30% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of KELYA to the average of the S&P500 Index (22.13), we can say KELYA is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.51 | ||
| Fwd PE | 4.09 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, KELYA is valued cheaply inside the industry as 91.36% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of KELYA indicates a rather cheap valuation: KELYA is cheaper than 96.30% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.22 | ||
| EV/EBITDA | 5.02 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)4.36
EPS Next 2Y11.73%
EPS Next 3YN/A
5. Dividend
5.1 Amount
KELYA has a Yearly Dividend Yield of 2.53%. Purely for dividend investing, there may be better candidates out there.
KELYA's Dividend Yield is rather good when compared to the industry average which is at 2.09. KELYA pays more dividend than 87.65% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.40, KELYA has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.53% |
5.2 History
The dividend of KELYA has a limited annual growth rate of 2.03%.
KELYA has been paying a dividend for at least 10 years, so it has a reliable track record.
KELYA has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)2.03%
Div Incr Years3
Div Non Decr Years4
5.3 Sustainability
KELYA has negative earnings and hence a negative payout ratio. The dividend may be in danger.
KELYA's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP-54.46%
EPS Next 2Y11.73%
EPS Next 3YN/A
11.73
+0.12 (+1.03%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners92.99%
Inst Owner Change2.36%
Ins Owners4.29%
Ins Owner Change3.46%
Market Cap412.90M
Analysts83.64
Price Target27.54 (134.78%)
Short Float %2.73%
Short Ratio2.88
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.53% |
Yearly Dividend0.31
Dividend Growth(5Y)2.03%
DP-54.46%
Div Incr Years3
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)22.6%
Min EPS beat(2)-27.88%
Max EPS beat(2)73.07%
EPS beat(4)2
Avg EPS beat(4)5.96%
Min EPS beat(4)-43.37%
Max EPS beat(4)73.07%
EPS beat(8)5
Avg EPS beat(8)22.31%
EPS beat(12)6
Avg EPS beat(12)12.15%
EPS beat(16)9
Avg EPS beat(16)23.56%
Revenue beat(2)1
Avg Revenue beat(2)-0.84%
Min Revenue beat(2)-2.27%
Max Revenue beat(2)0.6%
Revenue beat(4)1
Avg Revenue beat(4)-2.45%
Min Revenue beat(4)-6.05%
Max Revenue beat(4)0.6%
Revenue beat(8)1
Avg Revenue beat(8)-3.41%
Revenue beat(12)1
Avg Revenue beat(12)-3.49%
Revenue beat(16)1
Avg Revenue beat(16)-3.75%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)-0.31%
EPS NQ rev (3m)-10.66%
EPS NY rev (1m)-3.59%
EPS NY rev (3m)-3.8%
Revenue NQ rev (1m)-2.45%
Revenue NQ rev (3m)-3.67%
Revenue NY rev (1m)-0.21%
Revenue NY rev (3m)-0.73%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 5.51 | ||
| Fwd PE | 4.09 | ||
| P/S | 0.09 | ||
| P/FCF | 6.22 | ||
| P/OCF | 5.41 | ||
| P/B | 0.33 | ||
| P/tB | 0.6 | ||
| EV/EBITDA | 5.02 |
EPS(TTM)2.13
EY18.16%
EPS(NY)2.87
Fwd EY24.48%
FCF(TTM)1.89
FCFY16.08%
OCF(TTM)2.17
OCFY18.48%
SpS126.47
BVpS35.24
TBVpS19.55
PEG (NY)N/A
PEG (5Y)4.36
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -0.78% | ||
| ROE | -1.63% | ||
| ROCE | 4.19% | ||
| ROIC | 3.31% | ||
| ROICexc | 3.37% | ||
| ROICexgc | 4.93% | ||
| OM | 1.67% | ||
| PM (TTM) | N/A | ||
| GM | 20.52% | ||
| FCFM | 1.49% |
ROA(3y)-0.33%
ROA(5y)0.31%
ROE(3y)-0.73%
ROE(5y)0.68%
ROIC(3y)3.33%
ROIC(5y)2.79%
ROICexc(3y)3.58%
ROICexc(5y)3.03%
ROICexgc(3y)4.82%
ROICexgc(5y)3.87%
ROCE(3y)4.21%
ROCE(5y)3.54%
ROICexcg growth 3Y17.31%
ROICexcg growth 5Y-1.9%
ROICexc growth 3Y8.45%
ROICexc growth 5Y-7.18%
OM growth 3Y14.85%
OM growth 5Y-0.87%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y2.86%
GM growth 5Y2.42%
F-Score3
Asset Turnover1.72
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.16 | ||
| Debt/FCF | 3.08 | ||
| Debt/EBITDA | 1.74 | ||
| Cap/Depr | 22.92% | ||
| Cap/Sales | 0.22% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 64.94% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.64 | ||
| Quick Ratio | 1.64 | ||
| Altman-Z | 2.9 |
F-Score3
WACC8.82%
ROIC/WACC0.38
Cap/Depr(3y)36.22%
Cap/Depr(5y)42.06%
Cap/Sales(3y)0.27%
Cap/Sales(5y)0.28%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-9.36%
EPS 3Y15.06%
EPS 5Y1.26%
EPS Q2Q%-30.36%
EPS Next Y-0.92%
EPS Next 2Y11.73%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-3.49%
Revenue growth 3Y-4.09%
Revenue growth 5Y-4.15%
Sales Q2Q%11.46%
Revenue Next Year7.15%
Revenue Next 2Y5.63%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y11.73%
EBIT growth 3Y10.15%
EBIT growth 5Y-4.99%
EBIT Next Year148.46%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y4050%
FCF growth 3Y-40.18%
FCF growth 5Y-28.1%
OCF growth 1Y368.1%
OCF growth 3Y-31.85%
OCF growth 5Y-23.43%