Strong Q1/25 Performance and Strategic Restructuring Support Buy Rating for Kelly Services

Barrington analyst Kevin Steinke maintained a Buy rating on Kelly Services (KELYA – Research Report) today and set a price target of $25.00.

Kevin Steinke’s rating is based on Kelly Services’ strong financial performance in Q1/25, where the company reported revenue of $1.165 billion, surpassing the consensus estimate. This growth was largely fueled by the acquisition of Motion Recruitment Partners, which contributed to an 11.5% year-over-year increase in revenue. Despite macroeconomic challenges, Kelly Services managed to achieve modest organic revenue growth, demonstrating resilience in a competitive industry.
Furthermore, the company’s strategic restructuring, including the creation of the Enterprise Talent Management segment, is expected to enhance service delivery and efficiency. The adjusted EBITDA showed a year-over-year increase, and gross margins improved, partly due to the acquisition of higher-margin businesses. These factors, combined with cost reduction efforts in underperforming segments, support the Buy rating as Kelly Services positions itself for future growth despite certain headwinds.

According to TipRanks, Steinke is a 5-star analyst with an average return of 13.3% and a 56.19% success rate. Steinke covers the Industrials sector, focusing on stocks such as Huron Consulting, Distribution Solutions Group, and Quad/Graphics.

In another report released on May 12, Noble Financial also maintained a Buy rating on the stock with a $27.00 price target.