KORN FERRY (KFY) Stock Fundamental Analysis
USA - NYSE:KFY - US5006432000 - Common Stock
71 USD
+0.89 (+1.27%)
71 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to KFY. KFY was compared to 86 industry peers in the Professional Services industry. KFY scores excellent points on both the profitability and health parts. This is a solid base for a good stock. KFY has a correct valuation and a medium growth rate. KFY also has an excellent dividend rating. These ratings would make KFY suitable for dividend investing!
1. Profitability
1.1 Basic Checks
KFY had positive earnings in the past year.
In the past year KFY had a positive cash flow from operations.
In the past 5 years KFY has always been profitable.
Each year in the past 5 years KFY had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 6.80%, KFY is doing good in the industry, outperforming 67.44% of the companies in the same industry.
KFY has a Return On Equity of 13.06%. This is in the better half of the industry: KFY outperforms 62.79% of its industry peers.
KFY has a Return On Invested Capital of 9.24%. This is in the better half of the industry: KFY outperforms 66.28% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for KFY is below the industry average of 13.28%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.8% | ||
| ROE | 13.06% | ||
| ROIC | 9.24% |
ROA(3y)5.51%
ROA(5y)5.88%
ROE(3y)11.68%
ROE(5y)12.77%
ROIC(3y)9.27%
ROIC(5y)9.69%
1.3 Margins
With an excellent Profit Margin value of 8.84%, KFY belongs to the best of the industry, outperforming 80.23% of the companies in the same industry.
KFY's Profit Margin has improved in the last couple of years.
KFY has a Operating Margin of 13.01%. This is in the better half of the industry: KFY outperforms 77.91% of its industry peers.
In the last couple of years the Operating Margin of KFY has grown nicely.
KFY has a Gross Margin of 88.37%. This is amongst the best in the industry. KFY outperforms 96.51% of its industry peers.
In the last couple of years the Gross Margin of KFY has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 13.01% | ||
| PM (TTM) | 8.84% | ||
| GM | 88.37% |
OM growth 3Y-10.91%
OM growth 5Y1.62%
PM growth 3Y-10.01%
PM growth 5Y10.87%
GM growth 3Y-2.33%
GM growth 5Y-1.06%
2. Health
2.1 Basic Checks
KFY has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for KFY has been reduced compared to 1 year ago.
KFY has less shares outstanding than it did 5 years ago.
The debt/assets ratio for KFY has been reduced compared to a year ago.
2.2 Solvency
KFY has an Altman-Z score of 3.28. This indicates that KFY is financially healthy and has little risk of bankruptcy at the moment.
KFY's Altman-Z score of 3.28 is fine compared to the rest of the industry. KFY outperforms 62.79% of its industry peers.
KFY has a debt to FCF ratio of 1.42. This is a very positive value and a sign of high solvency as it would only need 1.42 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.42, KFY is in the better half of the industry, outperforming 73.26% of the companies in the same industry.
A Debt/Equity ratio of 0.21 indicates that KFY is not too dependend on debt financing.
KFY has a better Debt to Equity ratio (0.21) than 61.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 1.42 | ||
| Altman-Z | 3.28 |
ROIC/WACC1.12
WACC8.24%
2.3 Liquidity
A Current Ratio of 2.21 indicates that KFY has no problem at all paying its short term obligations.
The Current ratio of KFY (2.21) is better than 79.07% of its industry peers.
A Quick Ratio of 2.21 indicates that KFY has no problem at all paying its short term obligations.
Looking at the Quick ratio, with a value of 2.21, KFY is in the better half of the industry, outperforming 79.07% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.21 | ||
| Quick Ratio | 2.21 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.28% over the past year.
The Earnings Per Share has been growing by 10.91% on average over the past years. This is quite good.
Looking at the last year, KFY shows a very negative growth in Revenue. The Revenue has decreased by -19.68% in the last year.
KFY shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.91% yearly.
EPS 1Y (TTM)12.28%
EPS 3Y-7.74%
EPS 5Y10.91%
EPS Q2Q%11.02%
Revenue 1Y (TTM)-19.68%
Revenue growth 3Y1.46%
Revenue growth 5Y6.91%
Sales Q2Q%5.08%
3.2 Future
Based on estimates for the next years, KFY will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.73% on average per year.
The Revenue is expected to grow by 4.66% on average over the next years.
EPS Next Y6.05%
EPS Next 2Y8.32%
EPS Next 3Y9.73%
EPS Next 5YN/A
Revenue Next Year4.2%
Revenue Next 2Y4.31%
Revenue Next 3Y4.66%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 14.12, the valuation of KFY can be described as correct.
KFY's Price/Earnings ratio is a bit cheaper when compared to the industry. KFY is cheaper than 76.74% of the companies in the same industry.
KFY is valuated rather cheaply when we compare the Price/Earnings ratio to 27.57, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 12.35, the valuation of KFY can be described as correct.
Based on the Price/Forward Earnings ratio, KFY is valued a bit cheaper than 74.42% of the companies in the same industry.
KFY's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.09.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.12 | ||
| Fwd PE | 12.35 |
4.2 Price Multiples
83.72% of the companies in the same industry are more expensive than KFY, based on the Enterprise Value to EBITDA ratio.
75.58% of the companies in the same industry are more expensive than KFY, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.3 | ||
| EV/EBITDA | 7.52 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates KFY does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of KFY may justify a higher PE ratio.
PEG (NY)2.33
PEG (5Y)1.29
EPS Next 2Y8.32%
EPS Next 3Y9.73%
5. Dividend
5.1 Amount
KFY has a Yearly Dividend Yield of 2.81%.
KFY's Dividend Yield is rather good when compared to the industry average which is at 3.84. KFY pays more dividend than 89.53% of the companies in the same industry.
KFY's Dividend Yield is a higher than the S&P500 average which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.81% |
5.2 History
On average, the dividend of KFY grows each year by 31.50%, which is quite nice.
KFY has been paying a dividend for at least 10 years, so it has a reliable track record.
As KFY did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)31.5%
Div Incr Years4
Div Non Decr Years9
5.3 Sustainability
36.45% of the earnings are spent on dividend by KFY. This is a low number and sustainable payout ratio.
KFY's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP36.45%
EPS Next 2Y8.32%
EPS Next 3Y9.73%
71
+0.89 (+1.27%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners100.62%
Inst Owner Change-0.19%
Ins Owners0.85%
Ins Owner Change-0.58%
Market Cap3.72B
Revenue(TTM)2.79B
Net Income(TTM)247.01M
Analysts82.22
Price Target85.43 (20.32%)
Short Float %2.91%
Short Ratio4.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.81% |
Yearly Dividend1.62
Dividend Growth(5Y)31.5%
DP36.45%
Div Incr Years4
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.33%
Min EPS beat(2)3.72%
Max EPS beat(2)4.94%
EPS beat(4)3
Avg EPS beat(4)2.99%
Min EPS beat(4)-1.15%
Max EPS beat(4)4.94%
EPS beat(8)7
Avg EPS beat(8)4.34%
EPS beat(12)10
Avg EPS beat(12)4.25%
EPS beat(16)13
Avg EPS beat(16)4.84%
Revenue beat(2)2
Avg Revenue beat(2)1.99%
Min Revenue beat(2)1.79%
Max Revenue beat(2)2.19%
Revenue beat(4)3
Avg Revenue beat(4)1.16%
Min Revenue beat(4)-1.14%
Max Revenue beat(4)2.19%
Revenue beat(8)6
Avg Revenue beat(8)0.77%
Revenue beat(12)10
Avg Revenue beat(12)1.34%
Revenue beat(16)13
Avg Revenue beat(16)1.94%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)1.4%
EPS NQ rev (3m)0.46%
EPS NY rev (1m)-0.37%
EPS NY rev (3m)-2%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.59%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.21%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.12 | ||
| Fwd PE | 12.35 | ||
| P/S | 1.33 | ||
| P/FCF | 13.3 | ||
| P/OCF | 10.5 | ||
| P/B | 1.97 | ||
| P/tB | 4.23 | ||
| EV/EBITDA | 7.52 |
EPS(TTM)5.03
EY7.08%
EPS(NY)5.75
Fwd EY8.1%
FCF(TTM)5.34
FCFY7.52%
OCF(TTM)6.76
OCFY9.52%
SpS53.33
BVpS36.12
TBVpS16.79
PEG (NY)2.33
PEG (5Y)1.29
Graham Number63.93
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.8% | ||
| ROE | 13.06% | ||
| ROCE | 12.3% | ||
| ROIC | 9.24% | ||
| ROICexc | 12.22% | ||
| ROICexgc | 22.35% | ||
| OM | 13.01% | ||
| PM (TTM) | 8.84% | ||
| GM | 88.37% | ||
| FCFM | 10.01% |
ROA(3y)5.51%
ROA(5y)5.88%
ROE(3y)11.68%
ROE(5y)12.77%
ROIC(3y)9.27%
ROIC(5y)9.69%
ROICexc(3y)14.32%
ROICexc(5y)15.61%
ROICexgc(3y)33.58%
ROICexgc(5y)35.79%
ROCE(3y)12.34%
ROCE(5y)12.9%
ROICexgc growth 3Y-17.99%
ROICexgc growth 5Y3.52%
ROICexc growth 3Y-16.94%
ROICexc growth 5Y2.44%
OM growth 3Y-10.91%
OM growth 5Y1.62%
PM growth 3Y-10.01%
PM growth 5Y10.87%
GM growth 3Y-2.33%
GM growth 5Y-1.06%
F-Score8
Asset Turnover0.77
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 1.42 | ||
| Debt/EBITDA | 0.89 | ||
| Cap/Depr | 89.44% | ||
| Cap/Sales | 2.67% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 79.26% | ||
| Profit Quality | 113.19% | ||
| Current Ratio | 2.21 | ||
| Quick Ratio | 2.21 | ||
| Altman-Z | 3.28 |
F-Score8
WACC8.24%
ROIC/WACC1.12
Cap/Depr(3y)83.88%
Cap/Depr(5y)75.95%
Cap/Sales(3y)2.23%
Cap/Sales(5y)2.05%
Profit Quality(3y)131.86%
Profit Quality(5y)146.92%
High Growth Momentum
Growth
EPS 1Y (TTM)12.28%
EPS 3Y-7.74%
EPS 5Y10.91%
EPS Q2Q%11.02%
EPS Next Y6.05%
EPS Next 2Y8.32%
EPS Next 3Y9.73%
EPS Next 5YN/A
Revenue 1Y (TTM)-19.68%
Revenue growth 3Y1.46%
Revenue growth 5Y6.91%
Sales Q2Q%5.08%
Revenue Next Year4.2%
Revenue Next 2Y4.31%
Revenue Next 3Y4.66%
Revenue Next 5YN/A
EBIT growth 1Y-0.7%
EBIT growth 3Y-9.61%
EBIT growth 5Y8.64%
EBIT Next Year41.06%
EBIT Next 3Y17.22%
EBIT Next 5YN/A
FCF growth 1Y20.62%
FCF growth 3Y-12.61%
FCF growth 5Y9.16%
OCF growth 1Y17.55%
OCF growth 3Y-10.11%
OCF growth 5Y9.05%