Barrington analyst Gary Prestopino maintained a Buy rating on DHI Group (DHX – Research Report) today and set a price target of $11.50.
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Gary Prestopino has given his Buy rating due to a combination of factors, primarily focusing on DHI Group’s strategic organizational restructuring aimed at reducing costs and improving profitability. The company announced a significant reduction in workforce by 25% within its Dice brand, which is expected to result in annual cost savings of $14-16 million. These savings are anticipated to begin immediately, enhancing the company’s financial health.
Additionally, the restructuring is intended to address the disparity in adjusted EBITDA margins between DHI’s Dice and ClearanceJobs brands, with the latter showing a much higher margin. This move is expected to increase operating leverage and drive sales growth. Furthermore, the stock is currently undervalued, trading at a discount when considering the sum of its parts, suggesting a potential value of $10-13 per share. These factors collectively underpin the OUTPERFORM investment rating for DHI Group’s stock.
According to TipRanks, Prestopino is a 5-star analyst with an average return of 13.6% and a 54.18% success rate. Prestopino covers the Consumer Cyclical sector, focusing on stocks such as Liquidity Services, Dorman Products, and OPENLANE.
In another report released yesterday, Lake Street also maintained a Buy rating on the stock with a $3.50 price target.