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Was Robert Half International Inc.'s (NYSE:RHI) Earnings Growth Better Than The Industry's?

Simply Wall St

Measuring Robert Half International Inc.'s (NYSE:RHI) track record of past performance is a valuable exercise for investors. It allows us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess RHI's recent performance announced on 30 June 2019 and compare these figures to its historical trend and industry movements.

View our latest analysis for Robert Half International

Commentary On RHI's Past Performance

RHI's trailing twelve-month earnings (from 30 June 2019) of US$453m has jumped 34% compared to the previous year.

Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 5.9%, indicating the rate at which RHI is growing has accelerated. What's the driver of this growth? Let's take a look at if it is merely because of industry tailwinds, or if Robert Half International has seen some company-specific growth.

NYSE:RHI Income Statement, October 19th 2019

In terms of returns from investment, Robert Half International has invested its equity funds well leading to a 41% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 20% exceeds the US Professional Services industry of 7.2%, indicating Robert Half International has used its assets more efficiently. However, its return on capital (ROC), which also accounts for Robert Half International’s debt level, has declined over the past 3 years from 53% to 46%.

What does this mean?

Though Robert Half International's past data is helpful, it is only one aspect of my investment thesis. While Robert Half International has a good historical track record with positive growth and profitability, there's no certainty that this will extrapolate into the future. I suggest you continue to research Robert Half International to get a more holistic view of the stock by looking at:

  1. Future Outlook: What are well-informed industry analysts predicting for RHI’s future growth? Take a look at our free research report of analyst consensus for RHI’s outlook.
  2. Financial Health: Are RHI’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

NB: Figures in this article are calculated using data from the trailing twelve months from 30 June 2019. This may not be consistent with full year annual report figures.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.