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Insperity (NSP) Beats on Q2 Earnings & Revenues, Ups View

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Insperity, Inc.NSP reported better-than-expected second-quarter 2021 results.

Adjusted earnings of 91 cents per share beat the Zacks Consensus Estimate by 40% but decreased 40.9% year over year. The reported figure lies above the guidance of 60-70 cents.

Revenues of $1.19 billion surpassed the consensus mark by 7.7% and increased 19.3% year over year. The upside was backed by 12% increase in revenues per worksite employees (WSEEs) and 7% increase in paid worksite employees.

The average number of worksite employees paid per month, 243,270, inched up 6.7% year over year.

So far this year, shares of Insperity have gained 21.5% compared with 39.3% rise of the industry it belongs to.

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Operating Results

Gross profit of $199.55 million decreased 9.4% from the year-ago quarter. Gross margin of 16.8% declined from 22.2% in the year-ago quarter. Gross profit per worksite employee per month decreased 15.2% year over year to $273.

Adjusted EBITDA decreased 34.5% year over year to $60.2 million. Adjusted EBITDA per worksite employee per month decreased 39.3% to $82.

Operating expenses increased 11.6% year over year to $164.33 million. Operating expenses per worksite employee per month increased 4.7% to $225.

Operating income decreased 51.7% year over year to $35.22 million. Operating income per worksite employee per month fell 55.1% to $48.

Insperity, Inc. Price, Consensus and EPS Surprise

Insperity, Inc. Price, Consensus and EPS Surprise
Insperity, Inc. Price, Consensus and EPS Surprise

Insperity, Inc. price-consensus-eps-surprise-chart | Insperity, Inc. Quote

Balance Sheet & Cash Flow

Insperity exited second-quarter 2021 with adjusted cash, cash equivalents and marketable securities of $212.84 million compared with $196.65 million at the end of the prior quarter. Long-term debt amounted to $369.40 million, flat sequentially.

During the reported quarter, the company repurchased shares worth $8.8 million and paid out $17.3 million in cash dividends. Capital expenditures totaled $8.6 million.

Q3 Guidance

For third-quarter 2021, Insperity projects adjusted earnings in the range of 74-93 cents per share. The current Zacks Consensus Estimate of 65 cents lies below the guided range. Adjusted EBITDA is anticipated between $52 million and $62 million. Average WSEEs are expected in the range of 253,800-256,100.

2021 Guidance

Insperity raised its guidance for 2021. The company now projects adjusted earnings in the band of $4.00-$4.59 per share compared with the prior guidance of $3.83-$4.40. The current Zacks Consensus Estimate of $4.11 lies within the updated guidance.

Adjusted EBITDA is now anticipated in the range of $258-$288 million compared with the prior guidance of $250-$280 million. Average WSEEs are expected in the range of 247,100-249,500 compared with the prior guidance of 243,600-248,300.

Currently, Insperity carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Business Services Companies

Equifax’s EFX second-quarter 2021 adjusted earnings of $1.98 per share beat the Zacks Consensus Estimate by 15.8% and improved on a year-over-year basis. Revenues of $1.23 billion outpaced the consensus estimate by 6.4% and improved 26% year over year on a reported basis and 23% on a local-currency basis.

Robert Half’s RHI second-quarter 2021 earnings of $1.33 per share beat the consensus mark by 26.7% and were up more than 100% year over year. Revenues of $1.6 billion surpassed the consensus mark by 6.5% and increased 42.3% year over year on a reported basis and 40% on an adjusted basis.

ManpowerGroup’s MAN second-quarter 2021 adjusted earnings of $2.02 per share beat the consensus mark by 68.2% and improved more than 100%. Revenues of $5.28 billion beat the consensus mark by 2% and inched up 41% year over year on a reported basis and 31.3% on a constant-currency (cc) basis.


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