Bear of the Day: Robert Half Inc. (RHI)

Robert Half Inc. (RHI) is a global staffing and consulting firm specializing in professional services. Founded in 1948 and headquartered in Menlo Park, California, Robert Half operates through various divisions, including Accountemps, OfficeTeam, Robert Half Technology, Robert Half Finance & Accounting, and Protiviti, its consulting arm. The company provides temporary, full-time, and project-based staffing solutions in areas such as accounting, finance, technology, legal, and administrative support.Although it is one of the leaders in the Staffing Firm industry, the business has stagnated over the last five years. Over that period sales, earnings and the stock price are flat. Furthermore, Robert Half is trading at a premium to its historical valuation and has a Zacks Rank #5 (Strong Sell) rating.Based on these factors, Robert Half Inc. is a stock investor may want to avoid until the business can turn around the faltering growth rate.Image Source: Zacks Investment Research Analysts Downgrade Estimates at Robert Half Inc.Robert Half operates in a highly competitive market and faces tough competition in terms of price and reliability of service on a national, regional and local basis. Earnings estimates have been trending lower for more than two years now, dragging the stock down with it. These downgrades give RHI a Zacks Rank #5 (Strong Sell), which indicates there may be further downside ahead.Sales are expected to fall 8.8% this year and earnings are projected to fall 33.5% in the same period. Over the next three to five years, earnings are expected to grow just 4.1% annually.Image Source: Zacks Investment Research RHI Trades at a Premium Opening Room to the DownsideEven with the uncertain outlook for Robert Half’s business, the stock still trades at a premium valuation. At 23.6x forward earnings it is above the market average and above its 10-year median of 18.7x.Furthermore, with EPS growth forecasts of just 4.1% annually, the shares trade at a PEG ratio of 5.73x, which is an extremely high reading for the metric.Image Source: Zacks Investment Research Should Investors Buy Robert Half Inc. Shares?Given the current challenges facing Robert Half Inc., investors may want to exercise caution before considering this stock. The company has struggled with stagnation in both sales and earnings over the past five years, and its recent performance has been underwhelming. With a Zacks Rank #5 (Strong Sell) and analysts consistently downgrading earnings estimates, the near-term outlook for the stock appears bleak.While Robert Half remains a significant player in the staffing industry, its recent struggles and high valuation make it a risky investment at this time. Investors may want to wait for clearer signs of a turnaround before considering adding RHI to their portfolios.Infrastructure Stock Boom to Sweep AmericaA massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.The only question is “Will you get into the right stocks early when their growth potential is greatest?”Zacks has released a Special Report to help you do just that, and today it’s free. Discover 5 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How To Profit From Trillions On Spending For Infrastructure >>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 Robert Half Inc. (RHI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks