Kelly Services (NASDAQ:KELYA – Get Free Report) and Korn/Ferry International (NYSE:KFY – Get Free Report) are both business services companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, institutional ownership, risk, profitability, valuation, analyst recommendations and earnings.
Earnings & Valuation
This table compares Kelly Services and Korn/Ferry International”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Kelly Services | $4.33 billion | 0.11 | -$600,000.00 | ($0.20) | -70.55 |
| Korn/Ferry International | $2.76 billion | 1.39 | $246.06 million | $4.62 | 15.88 |
Profitability
This table compares Kelly Services and Korn/Ferry International’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Kelly Services | -0.14% | 5.65% | 2.72% |
| Korn/Ferry International | 8.91% | 14.49% | 7.21% |
Institutional and Insider Ownership
76.3% of Kelly Services shares are held by institutional investors. Comparatively, 98.8% of Korn/Ferry International shares are held by institutional investors. 48.1% of Kelly Services shares are held by insiders. Comparatively, 1.4% of Korn/Ferry International shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Dividends
Kelly Services pays an annual dividend of $0.30 per share and has a dividend yield of 2.1%. Korn/Ferry International pays an annual dividend of $1.92 per share and has a dividend yield of 2.6%. Kelly Services pays out -150.0% of its earnings in the form of a dividend. Korn/Ferry International pays out 41.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Korn/Ferry International has increased its dividend for 5 consecutive years. Korn/Ferry International is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Risk & Volatility
Kelly Services has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500. Comparatively, Korn/Ferry International has a beta of 1.47, meaning that its share price is 47% more volatile than the S&P 500.
Analyst Ratings
This is a breakdown of current recommendations for Kelly Services and Korn/Ferry International, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Kelly Services | 0 | 0 | 1 | 0 | 3.00 |
| Korn/Ferry International | 0 | 1 | 1 | 0 | 2.50 |
Kelly Services currently has a consensus target price of $25.00, indicating a potential upside of 77.18%. Korn/Ferry International has a consensus target price of $81.00, indicating a potential upside of 10.43%. Given Kelly Services’ stronger consensus rating and higher possible upside, analysts clearly believe Kelly Services is more favorable than Korn/Ferry International.
Summary
Korn/Ferry International beats Kelly Services on 11 of the 16 factors compared between the two stocks.
About Kelly Services
Kelly Services, Inc., together with its subsidiaries, provides workforce solutions to various industries. The company operates through five segments: Professional & Industrial; Science, Engineering & Technology; Education; Outsourcing & Consulting; and International. The Professional & Industrial segment delivers staffing, outcome-based, and permanent placement services providing administrative, accounting, and finance; light industrial; contact center staffing; and other workforce solutions. The Science, Engineering & Technology segment offers staffing, outcome-based, and permanent placement services in the areas of science and clinical research, engineering, technology, and telecommunications specialties. The Education segment provides staffing, permanent placement, and executive search services to pre-K-12 school districts and education organizations. The Outsourcing & Consulting segment offers managed service provider, recruitment process outsourcing, payroll process outsourcing, and executive coaching programs to customers on a global basis that includes its RocketPower brand. The International segment provides staffing, recruitment process outsourcing, and permanent placement services. The company serves customers in the United States, Canada, Mexico, Puerto Rico, France, Switzerland, Portugal, Russia, Italy, rest of Europe, and the Asia-Pacific region. Kelly Services, Inc. was founded in 1946 and is headquartered in Troy, Michigan.
About Korn/Ferry International
Korn Ferry, together with its subsidiaries, provides organizational consulting services worldwide. It operates through four segments: Consulting, Digital, Executive Search, and Recruitment Process Outsourcing (RPO) & Professional Search. The company provides executive search services to recruit board level, chief executive, other senior executive, and general management talent of organizations. It also offers organizational strategy, assessment and succession, leadership and professional development, and total reward services. In addition, the company provides RPO, business project, professional search, and outsource recruiting solutions. Further, the company offers tech-enabled solutions that identify structures, roles, capabilities, and behaviors to drive businesses. It serves public and private companies, and middle market and emerging growth companies, as well as government and non-profit organizations. The company was formerly known as Korn/Ferry International and changed its name to Korn Ferry in January 2019. Korn Ferry was founded in 1969 and is based in Los Angeles, California.
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