Seven HR stocks to explore amid tight labor market - Kalkine Media

October 29, 2021 01:56 PM PDT | By Ipsita Sarkar
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Highlights

  • Insperity, Inc. (NYSE: NSP) has a dividend yield of 1.46%. Its stock rose 51.54% YTD.

  • Automatic Data Processing, Inc. (NASDAQ: ADP) has a dividend yield of 1.68%. The stock grew by 27.35% YTD.

  • Equifax, Inc. (NYSE: EFX) stock generated 43.83% growth YTD, and its dividend yield is 0.58%.

The human resources companies provide HR solutions, including recruitment, employment administration, employee benefits, compensation, compliance, performance management, payroll, and human capital management. 

The latest report of the US Bureau of Labor Statistics shows compensation costs for civilian workers have increased by 1.3% on a seasonally adjusted basis for three months ended Sep 2021. Wages rose by 1.5% from June 2021 and by 4.2% in the twelve months ended Sep.

We discuss here seven stocks that grew in double-digit year-to-date.

Insperity, Inc. (NYSE: NSP)

Founded - 1986

Market Capitalization – US$4.8 billion 

P/E ratio – 43.29

Dividend yield – 1.46%

The Kingwood, Texas-based technology company provides human resource and business solutions to enterprises to improve their performance. Its most comprehensive HR services offerings are Workforce Optimization and Workforce Synchronization solutions. 

Its revenue was US$1.19 billion, and net income was US$25 million in the June quarter of 2021. The stock closed at US$125.38 on Oct 28, 2021. It rose 51.54% YTD.

Also Read: Are these 7 digital payment stocks primed for online shopping boom?

Top HR stocks: Insperity, Inc. (NYSE: NSP), Automatic Data Processing, Inc. (NASDAQ: ADP), Workday, Inc. (NASDAQ: WDAY), Ceridian HCM Holding Inc. (NYSE: CDAY).

Automatic Data Processing, Inc. Common Stock (NASDAQ: ADP)

Founded - 1949

Market Capitalization – US$95 billion 

P/E ratio – 34.5

Dividend yield – 1.68%

The company provides payroll and human capital management solutions. Its clients are small as well as large enterprises. It serves more than 920,000 clients in the US by offering HCM solutions, HR outsourcing, payroll, insurance, and retirement services. It also provides HR outsourcing solutions to small and midsized companies.

For the June quarter of 2021, it reported revenue of US$3.73 billion and net income of US$538 million. The stock grew by 27.35% YTD. It closed at US$222.94 on Oct 28, 2021.

Also Read: Top stocks with digital asset exposure to keep an eye on

Workday, Inc. (NASDAQ: WDAY) 

Founded - 2005

Market Capitalization – US$72 billion 

P/E ratio – N/A

Dividend yield – N/A

The company is based in Pleasanton, California. It provides solutions for human capital management, financial management, and business planning. The company has more than 12,000 employees and is known for being a cloud-only software provider company.

Its revenue for the June quarter of 2021 was US$1.26 billion, and net income was US$1.6 million. The stock rose 20.55% YTD. The closing price on Oct 28, 2021, was US$286.74.

Also Read: Travel stocks to watch as the US lifts restrictions

Ceridian HCM Holding Inc. (NYSE: CDAY)

Founded - 1992

Market Capitalization – US$19 billion 

P/E ratio – N/A

Dividend yield – N/A

This payroll processing and human resource management company is based in Minneapolis, Minnesota. It has around 4,000 customers and is in the transitioning phase from an on-premise to cloud-native payroll platform.

It posted revenue of US$250 million and a net loss of US$25.8 million in the June quarter of 2021. Its stock closed at US$125.66 on Oct 28. CDAY grew 14.22% YTD.

Also Read: Merck (MRK), Sanofi (SNY) raise profit guidance after solid Q3 results

Equifax, Inc. (NYSE: EFX)

Founded - 1899 

Market Capitalization – US$33.8 billion 

P/E ratio – 49.08

Dividend yield – 0.58%

The Atlanta, Georgia-based company is a credit bureau in the US and provides credit histories on millions to customers. Its one-third of revenue comes from the workforce solution it provides. In addition, it offers income verification and human resources services. The company generates 80% of its revenue from the US.

For the three months ended June 30, 2021, it earned revenue of US$1.22 billion and net income of US$205 million. Its stock generated 43.83% growth YTD and closed at US$275.54 on Oct 28, 2021.

Also Read: Caterpillar (CAT), Illinois (ITW) report solid revenue growth in Q3

TriNet Group, Inc. (NYSE: TNET)

Founded - 1988 

Market Capitalization – US$6.6 billion 

P/E ratio – 23.09

Dividend yield – N/A

The Dublin, California-based company provides human resource solutions for small-to-midsized enterprises. The products offerings include payroll processing, tax administration, insurance and claims management, expense and time management, employee compensation and benefits programs, compliance, human resources consultancy, etc. 

For the September quarter 221, the company posted revenue of US$1.15 billion and US$77 million in net income. The TNET stock gave a 24.83% return YTD and closed at US$100.17 on Oct 28, 2021. 

Also Read: Yum! (YUM) beats profit estimates, Hershey (HSY) raises guidance

Top HR stocks: Equifax, Inc. (NYSE: EFX), TriNet Group, Inc. (NYSE: TNET), Paycor HCM, Inc. (NASDAQ: PCR).

Source – Pixabay

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Paycor HCM, Inc. (NASDAQ: PCR)

Founded - 1990

Market Capitalization – US$5.7 billion 

P/E ratio – N/A

Dividend yield – N/A

The Cincinnati, Ohio-based Paycor HCM is a Software-as-a-Service provider of human capital management solutions. Its clients range from small to midsized businesses. The SaaS solutions support organizations in managing HCM, payroll, and regulatory compliance in one place.

The company booked revenue of US$88 million and a net loss of US$32.8 million in the June quarter of 2021. The stock increased by 24.95% YTD and closed at US$32.55 on Oct 28, 2021.

Also Read: US stocks rally after economic data

Bottomline

The International Labor Organization (ILO) had recently said that the global labor market is trailing despite progress in vaccinations. Still, the covid impact on jobs was not as severe as initially thought. Nevertheless, investors must analyze the companies and the overall sector carefully before investing in stocks.


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