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Insperity (NSP) Beats on Q3 Earnings & Revenues, Tweaks View

Insperity's (NSP) third-quarter 2021 earnings decrease year over year while revenues improve.

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This story originally appeared on Zacks

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

- Zacks

Adjusted earnings of 89 cents per share beat the Zacks Consensus Estimate by 6% but decreased 2.2% year over year. The reported figure lies within the guidance of 74-93 cents.

Revenues of $1.21 billion surpassed the consensus mark by 3.5% and increased 20% year over year. The upside was backed by 8% increase in revenues per worksite employees (WSEEs) and 11% increase in paid worksite employees.

The average number of worksite employees paid per month, 257,560, inched up 11.1% year over year.

So far this year, shares of Insperity have gained 51.4% compared with 49.8% rise of the industry it belongs to.

Zacks Investment ResearchImage Source: Zacks Investment Research

Operating Results       

Gross profit of $198.5 million increased 7.3% from the year-ago quarter. Gross margin of 16.4% declined from 18.4% in the year-ago quarter. Gross profit per worksite employee per month decreased 3.4% year over year to $257.

Adjusted EBITDA increased 4.5% year over year to $60.1 million. Adjusted EBITDA per worksite employee per month decreased 6% to $78.

Operating expenses increased 1.7% year over year to $158.9 million. Operating expenses per worksite employee per month decreased 8.4% to $206.

Operating income increased 37.6% year over year to $39.6 million. Operating income per worksite employee per month grew 24.4% to $51.

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 third-quarter 2021 with adjusted cash, cash equivalents and marketable securities of $227.57 million compared with $212.84 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 $11.3 million and paid out $17.4 million in cash dividends. Capital expenditures totaled $2.9 million.

Q4 Guidance

For fourth-quarter 2021, Insperity projects adjusted earnings in the range of 61-81 cents per share. The current Zacks Consensus Estimate of 76 cents lies within the guided range.

Adjusted EBITDA is anticipated between $45 million and $56 million. Average WSEEs are expected in the range of 265,500-268,000.

2021 Guidance

Insperity has updated its guidance for 2021. The company now projects adjusted earnings in the band of $4.25-$4.46 per share compared with the prior guidance of $4.00-$4.59. The current Zacks Consensus Estimate of $4.33 lies within the updated guidance.

Adjusted EBITDA is now anticipated in the range of $271-$282 million compared with the prior guidance of $258-$288 million. Average WSEEs are expected in the range of 250,100-250,600 compared with the prior guidance of 247,100-249,500.

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 third-quarter 2021 adjusted earnings of $1.85 per share beat the Zacks Consensus Estimate by 7.6% but declined on a year-over-year basis. Revenues of $1.22 billion outpaced the consensus estimate by 3.6% and improved 14.5% year over year on a reported basis and 14% on a local-currency basis.

IQVIA’s IQV third-quarter 2021 adjusted earnings per share of $2.17 beat the consensus mark by 1.9% and improved 33.1% on a year-over-year basis. Total revenues of $3.39 billion outpaced the consensus estimate by 1% and increased 21.7% year over year on a reported basis and 21.1% on a constant-currency basis.

Omnicom’s OMC third-quarter 2021 adjusted earnings of $1.65 per share beat the consensus mark by 20.4% and increased 36.4% year over year. Total revenues of $3.4 billion surpassed the consensus estimate by 0.6% and increased 7.1% year over year.



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