KORN FERRY (KFY) Stock Fundamental Analysis
NYSE:KFY - New York Stock Exchange, Inc. - US5006432000 - Common Stock - Currency: USD
Taking everything into account, KFY scores 6 out of 10 in our fundamental rating. KFY was compared to 82 industry peers in the Professional Services industry. Both the health and profitability get an excellent rating, making KFY a very profitable company, without any liquidiy or solvency issues. KFY has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
KFY had positive earnings in the past year.
KFY had a positive operating cash flow in the past year.
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
KFY has a better Return On Assets (6.29%) than 67.07% of its industry peers.
Looking at the Return On Equity, with a value of 13.01%, KFY is in the better half of the industry, outperforming 60.98% of the companies in the same industry.
With a decent Return On Invested Capital value of 9.18%, KFY is doing good in the industry, outperforming 67.07% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for KFY is below the industry average of 12.28%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.29% | ||
| ROE | 13.01% | ||
| ROIC | 9.18% |
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
KFY has a Profit Margin of 8.79%. This is amongst the best in the industry. KFY outperforms 80.49% of its industry peers.
KFY's Profit Margin has improved in the last couple of years.
The Operating Margin of KFY (12.85%) is better than 82.93% of its industry peers.
KFY's Operating Margin has improved in the last couple of years.
KFY's Gross Margin of 88.55% is amongst the best of the industry. KFY outperforms 97.56% of its industry peers.
KFY's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.85% | ||
| PM (TTM) | 8.79% | ||
| GM | 88.55% |
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so KFY is still creating some value.
KFY has less shares outstanding than it did 1 year ago.
The number of shares outstanding for KFY has been reduced compared to 5 years ago.
Compared to 1 year ago, KFY has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.00 indicates that KFY is not in any danger for bankruptcy at the moment.
KFY has a Altman-Z score (3.00) which is in line with its industry peers.
KFY has a debt to FCF ratio of 1.33. This is a very positive value and a sign of high solvency as it would only need 1.33 years to pay back of all of its debts.
KFY has a Debt to FCF ratio of 1.33. This is in the better half of the industry: KFY outperforms 76.83% of its industry peers.
A Debt/Equity ratio of 0.21 indicates that KFY is not too dependend on debt financing.
KFY has a Debt to Equity ratio (0.21) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 1.33 | ||
| Altman-Z | 3 |
ROIC/WACC1.03
WACC8.94%
2.3 Liquidity
KFY has a Current Ratio of 1.83. This is a normal value and indicates that KFY is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of KFY (1.83) is better than 69.51% of its industry peers.
A Quick Ratio of 1.83 indicates that KFY should not have too much problems paying its short term obligations.
KFY has a better Quick ratio (1.83) than 69.51% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.83 | ||
| Quick Ratio | 1.83 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 14.22% over the past year.
KFY shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.91% yearly.
Looking at the last year, KFY shows a very negative growth in Revenue. The Revenue has decreased by -21.15% 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)14.22%
EPS 3Y-7.74%
EPS 5Y10.91%
EPS Q2Q%4.76%
Revenue 1Y (TTM)-21.15%
Revenue growth 3Y1.46%
Revenue growth 5Y6.91%
Sales Q2Q%3.08%
3.2 Future
The Earnings Per Share is expected to grow by 9.79% on average over the next years. This is quite good.
Based on estimates for the next years, KFY will show a small growth in Revenue. The Revenue will grow by 4.55% on average per year.
EPS Next Y8.21%
EPS Next 2Y9.51%
EPS Next 3Y9.79%
EPS Next 5YN/A
Revenue Next Year2.96%
Revenue Next 2Y3.87%
Revenue Next 3Y4.55%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 15.10, which indicates a correct valuation of KFY.
Compared to the rest of the industry, the Price/Earnings ratio of KFY indicates a somewhat cheap valuation: KFY is cheaper than 68.29% of the companies listed in the same industry.
KFY is valuated rather cheaply when we compare the Price/Earnings ratio to 27.50, which is the current average of the S&P500 Index.
KFY is valuated correctly with a Price/Forward Earnings ratio of 13.95.
69.51% of the companies in the same industry are more expensive than KFY, based on the Price/Forward Earnings ratio.
KFY's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 36.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.1 | ||
| Fwd PE | 13.95 |
4.2 Price Multiples
KFY's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. KFY is cheaper than 86.59% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of KFY indicates a somewhat cheap valuation: KFY is cheaper than 75.61% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.72 | ||
| EV/EBITDA | 7.27 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of KFY may justify a higher PE ratio.
PEG (NY)1.84
PEG (5Y)1.38
EPS Next 2Y9.51%
EPS Next 3Y9.79%
5. Dividend
5.1 Amount
KFY has a Yearly Dividend Yield of 2.58%. Purely for dividend investing, there may be better candidates out there.
KFY's Dividend Yield is rather good when compared to the industry average which is at 2.10. KFY pays more dividend than 90.24% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, KFY has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.58% |
5.2 History
The dividend of KFY is nicely growing with an annual growth rate of 31.50%!
KFY has paid a dividend for at least 10 years, which is 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
KFY pays out 34.44% of its income as dividend. This is a sustainable payout ratio.
KFY's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP34.44%
EPS Next 2Y9.51%
EPS Next 3Y9.79%
73.97
-0.53 (-0.71%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners98.98%
Inst Owner Change-0.02%
Ins Owners1.02%
Ins Owner Change-2.87%
Market Cap3.84B
Analysts82.22
Price Target85.43 (15.49%)
Short Float %3.14%
Short Ratio3.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.58% |
Yearly Dividend1.62
Dividend Growth(5Y)31.5%
DP34.44%
Div Incr Years4
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.09%
Min EPS beat(2)3.72%
Max EPS beat(2)4.45%
EPS beat(4)3
Avg EPS beat(4)2.88%
Min EPS beat(4)-1.15%
Max EPS beat(4)4.5%
EPS beat(8)7
Avg EPS beat(8)4.63%
EPS beat(12)9
Avg EPS beat(12)3.7%
EPS beat(16)13
Avg EPS beat(16)6.19%
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)0.85%
Min Revenue beat(4)-1.14%
Max Revenue beat(4)2.19%
Revenue beat(8)6
Avg Revenue beat(8)0.68%
Revenue beat(12)9
Avg Revenue beat(12)1.17%
Revenue beat(16)13
Avg Revenue beat(16)2.31%
PT rev (1m)0%
PT rev (3m)3.08%
EPS NQ rev (1m)4.34%
EPS NQ rev (3m)1.3%
EPS NY rev (1m)4.67%
EPS NY rev (3m)4.42%
Revenue NQ rev (1m)1.21%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)0.82%
Revenue NY rev (3m)-0.74%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.1 | ||
| Fwd PE | 13.95 | ||
| P/S | 1.39 | ||
| P/FCF | 12.72 | ||
| P/OCF | 10.54 | ||
| P/B | 2.06 | ||
| P/tB | 4.53 | ||
| EV/EBITDA | 7.27 |
EPS(TTM)4.9
EY6.62%
EPS(NY)5.3
Fwd EY7.17%
FCF(TTM)5.81
FCFY7.86%
OCF(TTM)7.02
OCFY9.49%
SpS53.18
BVpS35.95
TBVpS16.32
PEG (NY)1.84
PEG (5Y)1.38
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.29% | ||
| ROE | 13.01% | ||
| ROCE | 12.21% | ||
| ROIC | 9.18% | ||
| ROICexc | 14.32% | ||
| ROICexgc | 31.63% | ||
| OM | 12.85% | ||
| PM (TTM) | 8.79% | ||
| GM | 88.55% | ||
| FCFM | 10.93% |
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%
ROICexcg growth 3Y-17.99%
ROICexcg 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 Turnover0.72
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 1.33 | ||
| Debt/EBITDA | 0.92 | ||
| Cap/Depr | 77.83% | ||
| Cap/Sales | 2.26% | ||
| Interest Coverage | 14.06 | ||
| Cash Conversion | 83.73% | ||
| Profit Quality | 124.32% | ||
| Current Ratio | 1.83 | ||
| Quick Ratio | 1.83 | ||
| Altman-Z | 3 |
F-Score8
WACC8.94%
ROIC/WACC1.03
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)14.22%
EPS 3Y-7.74%
EPS 5Y10.91%
EPS Q2Q%4.76%
EPS Next Y8.21%
EPS Next 2Y9.51%
EPS Next 3Y9.79%
EPS Next 5YN/A
Revenue 1Y (TTM)-21.15%
Revenue growth 3Y1.46%
Revenue growth 5Y6.91%
Sales Q2Q%3.08%
Revenue Next Year2.96%
Revenue Next 2Y3.87%
Revenue Next 3Y4.55%
Revenue Next 5YN/A
EBIT growth 1Y2.18%
EBIT growth 3Y-9.61%
EBIT growth 5Y8.64%
EBIT Next Year34.33%
EBIT Next 3Y17.27%
EBIT Next 5YN/A
FCF growth 1Y31.93%
FCF growth 3Y-12.61%
FCF growth 5Y9.16%
OCF growth 1Y28.31%
OCF growth 3Y-10.11%
OCF growth 5Y9.05%