Robert Half Downgraded at BofA Securities on Labor Market Easing Expectations
2022.06.23 19:16
Robert Half (RHI) Downgraded at BofA Securities on Labor Market Easing Expectations
By Sam Boughedda
Robert Half International (NYSE:RHI) was downgraded by BofA analyst Heather Balsky from Buy to Underperform, lowering its price target to $77 from $133 on Thursday.
Balsky and analysts at BofA believe the fundamentals have peaked and they see downside risk to Street estimates.
“We’re cutting our 2022/2023E EPS by 4/27% to $6.34/5.36 (vs. $6.32/6.75 consensus) on a lower sales and margin outlook. We assume sales inflect negative in 2023 (-8%) against very difficult comparisons and sluggish US 2023 GDP growth (our BofA Economics team expects +1.35%),” said Balsky.
“Our forecast assumes a modest downturn compared to the 2001-02 and 2008-09 recessions (see Exhibits 5-7) and support from the very US tight labor markets. There’s downside risk to our EPS outlook if the US economy and labor demand weakens more than anticipated,” added the analyst.
BofA expects the easing labor market to weigh on the company’s sales in 2023, after posting “exceptional sales growth” over recent quarters as it recovered from the Covid downturn.
RHI shares have tumbled over 7% Thursday.
