RHI: Sequential Contract Stabilization Will Offset Softer Guidance And Consulting Weakness

Analysts have moderately reduced their price target on Robert Half, trimming fair value by about $1.70 to approximately $30.80 per share as they factor in softer guidance, margin pressure from weaker Protiviti trends, and a still muted rebound in staffing demand.

Analyst Commentary

Street research reflects a mixed but generally cautious stance on Robert Half, with lower price targets anchored in tempered expectations for near term growth and profitability.

Bullish Takeaways

• Bullish analysts highlight that the Buy rated calls and still premium targets assume the company can benefit from eventual normalization in staffing and project demand, which in turn could support a valuation re rating over time.
• Sequential improvement in weekly contract talent revenues exiting the quarter is viewed as an early sign that core staffing trends may be stabilizing, which could underpin gradual revenue growth and operating leverage.
• Commentary around stable demand in private IT staffing channels is being interpreted as a floor under technology related volumes, limiting downside risk to growth assumptions in that segment.
• The decision to avoid adding leverage for buybacks is seen by some as disciplined capital allocation that preserves balance sheet flexibility for strategic investments and potential cyclical recovery.

Bearish Takeaways

• Bearish analysts are cutting price targets in response to disappointing guidance, suggesting that prior earnings and cash flow expectations were too optimistic and warrant a lower fair value range.
• First year over year revenue declines at Protiviti since 2024 and associated margin pressure are raising concerns about the durability of this higher margin consulting engine within the broader portfolio.
• A still muted rebound in staffing demand, with no clear evidence of a material upcycle, is driving skepticism that the company can quickly re accelerate top line growth or expand margins back to prior peaks.
• The more cautious stance on share repurchases is interpreted by some as management signaling limited near term confidence in visibility, which may cap upside to earnings per share and constrain multiple expansion.

What's in the News

• Updated share repurchase activity indicates Robert Half bought back 573,650 shares, or about 0.57 percent of shares outstanding, for 20.21 million dollars in the third quarter of 2025. This brings total repurchases under the 2018 authorization to 24,422,565 shares, or 22.24 percent, for 1,688.72 million dollars (Key Developments).
• The company issued fourth quarter 2025 guidance, calling for revenues between 1.245 billion and 1.345 billion dollars and earnings per share of 0.25 to 0.35 dollars, which frames expectations for near term performance amid softer demand trends (Key Developments).

Valuation Changes

• Fair value has fallen modestly, from about $32.44 per share to approximately $30.78 per share.
• The discount rate has risen slightly, moving from roughly 7.30 percent to about 7.31 percent, implying a marginally higher required return.
• Revenue growth assumptions have increased slightly, from around 2.05 percent to roughly 2.08 percent.
• Net profit margin expectations have inched higher, from about 3.80 percent to approximately 3.84 percent.
• The future P/E multiple has declined, from roughly 17.8x to about 16.7x, indicating a lower valuation placed on forward earnings.