The 10-second takeaway
For the quarter ended April 1 (Q1), Kelly Services missed slightly on revenue and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased slightly and GAAP earnings per share grew significantly.
Margins improved across the board.
Kelly Services booked revenue of $1.35 billion. The three analysts polled by S&P Capital IQ foresaw a top line of $1.38 billion on the same basis. GAAP reported sales were 1.2% higher than the prior-year quarter's $1.34 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.24. The six earnings estimates compiled by S&P Capital IQ predicted $0.18 per share. GAAP EPS of $0.25 for Q1 were much higher than the prior-year quarter's $0.03 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 16.5%, 50 basis points better than the prior-year quarter. Operating margin was 1.1%, 70 basis points better than the prior-year quarter. Net margin was 0.7%, 60 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $1.44 billion. On the bottom line, the average EPS estimate is $0.32.
Next year's average estimate for revenue is $5.67 billion. The average EPS estimate is $1.24.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Kelly Services is outperform, with an average price target of $21.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.