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ASGN Incorporated (ASGN)
NYSE:ASGN
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ASGN
(NYSE:ASGN)
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Rating:66Neutral
Price Target:
$49.00
▼(-2.93% Downside)
ASGN's overall stock score reflects a company facing financial challenges with declining revenue and profitability, but with potential growth opportunities in IT consulting and AI. The technical analysis suggests caution, while the valuation remains reasonable. The earnings call provided a balanced outlook with both strengths and risks.
Positive Factors
IT Consulting Growth
The strong performance in IT consulting indicates a robust demand for ASGN's services, positioning the company well for sustained growth in this sector.
Federal Segment Strength
The strong bookings in the federal segment suggest a stable revenue stream and potential for future growth, enhancing ASGN's market position.
AI and Digital Transformation
The focus on AI and digital transformation projects positions ASGN to capitalize on industry trends, driving long-term growth and innovation.
Negative Factors
Revenue Decline
The decline in revenue indicates challenges in maintaining sales momentum, which could impact ASGN's ability to sustain growth.
Assignment Revenue Decrease
The significant drop in assignment revenues reflects vulnerabilities to economic cycles, potentially affecting ASGN's financial stability.
Free Cash Flow Decline
The decline in free cash flow growth raises concerns about ASGN's liquidity and its ability to fund operations and growth initiatives.
ASGN (ASGN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.07B
Dividend YieldN/A
Average Volume (3M)599.88K
Price to Earnings (P/E)17.0
Beta (1Y)0.68
Revenue Growth-4.86%
EPS Growth-25.15%
CountryUS
Employees3,200
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)1.31
Shares Outstanding42,700,000
10 Day Avg. Volume656,207
30 Day Avg. Volume599,885
Financial Highlights & Ratios
PEG Ratio-1.48
Price to Book (P/B)2.12
Price to Sales (P/S)0.92
P/FCF Ratio10.33
Enterprise Value/Market Cap1.53
Enterprise Value/Revenue0.79
Enterprise Value/Gross Profit2.74
Enterprise Value/Ebitda7.36
Forecast
1Y Price Target
$48.25Price Target Upside-4.42% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering5
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
ASGN Business Overview & Revenue Model
Company DescriptionASGN Incorporated provides information technology services and professional solutions in the technology, digital, and creative fields for commercial and government sectors in the United States. It operates through two segments: Commercial and Federal Government. The Commercial Segment provides consulting, creative digital marketing, and permanent placement services primarily to Fortune 1000 and mid-market clients. This segment also offers workforce mobilization, modern enterprise, and digital innovation IT consulting services; and cloud, data and analytics, and digital transformation solutions. The Federal Government Segment provides mission-critical solutions to the department of defense, intelligence agencies, and civilian agencies. This segment offers cloud, cybersecurity, artificial intelligence, machine learning, application and IT modernization, and science and engineering solutions. The company was formerly known as On Assignment, Inc. and changed its name to ASGN Incorporated in April 2018. ASGN Incorporated was incorporated in 1985 and is based in Glen Allen, Virginia.
How the Company Makes MoneyASGN generates revenue primarily through its staffing and consulting services, which are billed on a time-and-materials basis or through fixed-fee contracts. The company earns fees from placing skilled professionals in temporary, contract, and permanent positions across multiple sectors, with a significant focus on IT and creative talent. Key revenue streams include billable hours worked by consultants and the placement fees for permanent hires. Additionally, ASGN benefits from long-term contracts with government agencies and private sector clients, which provide stable income. Partnerships with technology firms and other service providers further enhance ASGN's capabilities, enabling the company to offer comprehensive solutions and drive additional revenue growth.
ASGN Earnings Call Summary
Earnings Call Date:Oct 22, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 11, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with solid performance in IT consulting and healthcare sectors, but challenges in revenue decline, assignment revenues, and the potential impact of the government shutdown. The highlights and lowlights reflect a balanced outlook with positive growth prospects tempered by existing challenges.Q3-2025 Updates
Positive Updates
Solid Revenue and EBITDA Performance
ASGN delivered solid performance in the third quarter, with revenues reaching $1.01 billion and an adjusted EBITDA margin of 11.1%, both at the high end of guidance ranges.
Growth in IT Consulting
The IT consulting business continues to be a key growth driver, representing approximately 63% of total revenues in the third quarter, up from 58% in the same period last year.
Increase in AI and Data Projects
ASGN has seen an increase in projects focused on data and AI, application development and engineering, customer experience, and cybersecurity, highlighting a significant commitment to digital advancement.
Healthcare Industry Performance
The healthcare industry saw the largest sequential growth, up high single digits as compared to the year ago, driven by healthcare provider, pharmaceutical, and biotech clients.
Strong Federal Segment Bookings
In the federal segment, new contract awards totaled $461 million for the third quarter, with a book-to-bill of 1.5 times for the quarter.
Negative Updates
Year-over-Year Revenue Decline
Revenues totaled $1.01 billion, a decrease of 1.9% year over year, with the commercial segment decreasing by 1% and the federal government segment by 3.9%.
Decrease in Assignment Revenues
Assignment revenues totaled $376.4 million, a decrease of 13.2% year over year, reflecting continued softness in portions of the commercial segment sensitive to macroeconomic cycles.
Challenges in Financial Services
Financial services experienced a year-over-year decline, although new wins for the industry outpaced renewals in Q3.
Impact of Government Shutdown
The government shutdown poses a potential headwind, slowing down the cycle of new awards and the ability to ramp up on awards just won.
Company Guidance
During the ASGN Incorporated Third Quarter 2025 Earnings Call, the company provided guidance highlighting strong performance and growth in various sectors. ASGN reported revenues of $1.01 billion with an adjusted EBITDA margin of 11.1%, both at the high end of their guidance ranges. The IT consulting business was a significant growth driver, accounting for 63% of total revenues, with commercial consulting bookings at $324 million and a book-to-bill ratio of 1.2 times. In the federal segment, new contract awards totaled $461 million, with a book-to-bill ratio of 1.5 times for the quarter. The company also emphasized the growing demand for AI and digital transformation, indicating that AI spending is becoming a core aspect of enterprise technology. Despite challenges such as organizational readiness and a shortage of technical talent, ASGN is well-positioned to leverage its capabilities, particularly with the potential positive impact from changes to the H-1B visa process. Looking forward, ASGN projected fourth-quarter revenues between $960 million and $980 million, with an adjusted EBITDA margin of 10.6% to 10.9%.ASGN Financial Statement Overview
Summary
ASGN's financial performance shows challenges with declining revenue and profit margins, and reduced cash flow growth. The balance sheet remains stable with manageable leverage, but the reduced return on equity and cash flow concerns highlight potential risks.Income Statement
ASGN's income statement shows a declining revenue trend with a negative revenue growth rate of -48.9% TTM, indicating potential challenges in maintaining sales momentum. The gross profit margin remains stable around 28.9%, but the net profit margin has decreased to 3.3% TTM, reflecting reduced profitability. EBIT and EBITDA margins have also declined, suggesting operational inefficiencies. Overall, the income statement reflects moderate financial health with concerns about revenue and profit declines.Balance Sheet
The balance sheet indicates a moderate debt-to-equity ratio of 0.64 TTM, showing manageable leverage. Return on equity has decreased to 7.2% TTM, which is lower than previous years, indicating reduced efficiency in generating profits from equity. The equity ratio stands at 49.5% TTM, suggesting a stable capital structure. While the balance sheet remains relatively strong, the declining ROE is a concern.Cash Flow
ASGN's cash flow statement shows a decline in free cash flow growth by -19.7% TTM, indicating potential cash generation issues. The operating cash flow to net income ratio is not available TTM, but the free cash flow to net income ratio is healthy at 87%. Despite a strong free cash flow to net income ratio, the negative growth in free cash flow raises concerns about future liquidity.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.99B | 4.10B | 4.45B | 4.58B | 4.01B | 3.50B |
| Gross Profit | 1.15B | 1.18B | 1.28B | 1.37B | 1.14B | 947.20M |
| EBITDA | 428.00M | 400.70M | 464.40M | 500.90M | 440.50M | 370.90M |
| Net Income | 130.70M | 175.20M | 219.30M | 268.10M | 409.90M | 200.30M |
Balance Sheet | ||||||
| Total Assets | 3.70B | 3.43B | 3.54B | 3.59B | 3.50B | 3.28B |
| Cash, Cash Equivalents and Short-Term Investments | 126.50M | 205.20M | 175.90M | 70.30M | 529.60M | 274.40M |
| Total Debt | 1.24B | 1.10B | 1.11B | 1.12B | 1.10B | 1.11B |
| Total Liabilities | 1.87B | 1.65B | 1.65B | 1.68B | 1.64B | 1.69B |
| Stockholders Equity | 1.83B | 1.78B | 1.89B | 1.90B | 1.87B | 1.59B |
Cash Flow | ||||||
| Free Cash Flow | 283.30M | 364.70M | 417.00M | 270.30M | 159.00M | 392.20M |
| Operating Cash Flow | 325.80M | 400.00M | 456.90M | 307.80M | 193.70M | 424.80M |
| Investing Cash Flow | -348.60M | -35.30M | -40.50M | -510.00M | 246.50M | -219.00M |
| Financing Cash Flow | -17.80M | -333.20M | -310.90M | -256.50M | -184.40M | -29.00M |
ASGN Technical Analysis
Positive
50.48
Price Trends
45.92
Positive
47.84
Positive
50.82
Negative
Market Momentum
0.78
Positive
64.12
Neutral
67.30
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ASGN, the sentiment is Positive. The current price of 50.48 is above the 20-day moving average (MA) of 48.56, above the 50-day MA of 45.92, and below the 200-day MA of 50.82, indicating a neutral trend. The MACD of 0.78 indicates Positive momentum. The RSI at 64.12 is Neutral, neither overbought nor oversold. The STOCH value of 67.30 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ASGN.
ASGN Risk Analysis
ASGN disclosed 29 risk factors in its most recent earnings report. ASGN reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
ASGN Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $2.55B | 35.63 | 8.18% | 0.80% | 6.98% | -4.56% | |
67 Neutral | $3.10B | 30.60 | 4.91% | ― | 5.56% | -42.38% | |
66 Neutral | $2.07B | 17.02 | 7.25% | ― | -4.86% | -25.15% | |
62 Neutral | $2.60B | 7.44 | 12.33% | ― | -4.13% | 2143.48% | |
62 Neutral | $1.06B | 13.56 | 15.40% | ― | 19.88% | 51.03% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
47 Neutral | $1.92B | -4.89 | -46.77% | ― | 1.84% | -27.74% |
* Technology Sector Average
ASGN
ASGN
50.48
-35.53
-41.31%
FORTY
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167.93
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105.41%
GLOB
Globant SA
69.18
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DXC
DXC Technology
15.06
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-22.65%
AI
C3ai
13.83
-18.59
-57.34%
TASK
TaskUs
11.86
-3.36
-22.08%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.