Robert Half International, Dice Holdings rise after 3Q earnings surprise

Thursday, October 22, 2009

2 staffing firms up after 3Q earnings surprise

HARTFORD, Conn. — Shares of Robert Half International and Dice Holdings Inc. rose Thursday, after the staffing companies posted better-than-expected third-quarter earnings.

Credit Suisse analyst John Blackledge upgraded Dice Holdings to “Neutral” from “Underperform” and nearly tripled his price target to $8 from $3 based on “moderate improvements in business conditions.”

He said in a client note that it “may get a little worse before it gets better” for the New York-based company because he expects fourth-quarter revenue to decline.

“But overall, with contract renewals improving and new business activity picking up, DHX should see the benefits at some point in 2010,” Blackledge said.

The online recruiting and career development company beat Wall Street estimates by posting net income of $3 million, or 5 cents per share. That was down 53 percent from year-ago profit of $6.4 million, or 10 cents per share, but better than analysts had expected.

Stifel Nicolaus analyst James Janesky said in a client note Thursday that higher demand for audit and compliance work at Protiviti, a business of Robert Half International Inc., offset a miss in temporary staffing.

He reiterated his “Sell” rating.

Robert Half International said Wednesday its third-quarter profit fell 86 percent, though the Menlo Park, Calif., company still beat Wall Street estimates. Net income totaled $9 million, or 6 cents per share, down from $63.8 million, or 42 cents per share, in the same quarter last year.

Analysts surveyed by Thomson Reuters expected earnings of 4 cents per share.

BMO Capital Markets analyst Jeffrey M. Silber also maintained his “Underperform” rating, however.

“While we acknowledge we are fighting sentiment and believe the stock will rally today after yesterday’s 6.3 percent decline, we still believe the stock is a bit ahead of itself,” he said in a client note.

Shares of Robert Half rose $1.48, or 6 percent, to close at $26.21. Dice Holdings increased 18 cents, or nearly 3 percent, to finish at $6.95.

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