Kforce (NASDAQ:KFRC) versus HireRight (NYSE:HRT) Financial Contrast

Kforce (NASDAQ:KFRC) and HireRight (NYSE:HRT) are both small-cap industrials companies, but which is the better business? We will compare the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, profitability, institutional ownership and valuation.

Risk & Volatility

Kforce has a beta of 0.85, suggesting that its share price is 15% less volatile than the S&P 500. Comparatively, HireRight has a beta of 0.17, suggesting that its share price is 83% less volatile than the S&P 500.

Dividends

Kforce pays an annual dividend of $1.52 per share and has a dividend yield of 2.4%. HireRight pays an annual dividend of $0.12 per share and has a dividend yield of 0.8%. Kforce pays out 48.6% of its earnings in the form of a dividend. HireRight pays out -48.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Kforce has raised its dividend for 5 consecutive years. Kforce is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Kforce and HireRight’s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kforce	$1.53 billion	0.82	$61.08 million	$3.13	20.52
HireRight	$721.88 million	0.06	-$705,000.00	($0.25)	-57.28

Kforce has higher revenue and earnings than HireRight. HireRight is trading at a lower price-to-earnings ratio than Kforce, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent recommendations and price targets for Kforce and HireRight, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kforce	0	3	1	0	2.25
HireRight	0	4	1	0	2.20

Kforce currently has a consensus price target of $68.33, indicating a potential upside of 6.39%. HireRight has a consensus price target of $12.50, indicating a potential downside of 12.71%. Given Kforce’s stronger consensus rating and higher possible upside, analysts plainly believe Kforce is more favorable than HireRight.

Institutional and Insider Ownership

92.8% of Kforce shares are owned by institutional investors. Comparatively, 12.5% of HireRight shares are owned by institutional investors. 5.3% of Kforce shares are owned by company insiders. Comparatively, 13.0% of HireRight shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Kforce and HireRight’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kforce	3.99%	38.24%	18.37%
HireRight	N/A	N/A	N/A

Summary

Kforce beats HireRight on 14 of the 16 factors compared between the two stocks.

About Kforce

Kforce Inc. provides professional staffing services and solutions in the United States. It operates through two segments, Technology, and Finance and Accounting (FA). The Technology segment provides talent solutions to its clients primarily in the areas of information technology, such as systems/applications architecture and development, data management and analytics, business and artificial intelligence, machine learning, project and program management, and network architecture and security. This segment serves clients in various industries comprising financial and business services, communications, insurance, retail, and technology industries. The FA businesses segment offers talent solutions to its clients in areas, including financial planning and analysis, business intelligence analysis, general accounting, transactional accounting, business and cost analysis, and taxation and treasury. It also provides consultants in lower skilled areas comprising loan servicing and support, customer and call center support, data entry, and other administrative roles. This segment serves clients in various industries, including financial and business services, healthcare, and manufacturing sectors. The company was founded in 1962 and is headquartered in Tampa, Florida.

About HireRight

HireRight Holdings Corporation provides technology-driven workforce risk management and compliance solutions worldwide. It offers background screening, verification, identification, monitoring, and drug and health screening services for customers under the HireRight brand name. The company provides its services through software and data platform that integrates into its customers' human capital management systems enabling workflows for workforce hiring, onboarding, and monitoring. It serves transportation, healthcare, technology, financial services, business and consumer services, manufacturing, education, and retail industries, as well as not-for-profit organizations. HireRight Holdings Corporation was incorporated in 1990 and is headquartered in Nashville, Tennessee.