Barrett Business Services (BBSI) AI Stock Analysis

• Market Cap: $1.08B
• Dividend Yield: 0.76%
• Average Volume (3M): 137.43K
• Price to Earnings (P/E): 21.1
• Beta (1Y): 0.75
• Revenue Growth: 8.41%
• EPS Growth: 7.93%
• Country: US
• Employees: 135,727
• Sector: Industrials
• Sector Strength: 87
• Industry: Staffing & Employment Services
• EPS (TTM): -0.04
• Shares Outstanding: 25,680,212
• 10 Day Avg. Volume: 127,626
• 30 Day Avg. Volume: 137,432
• PEG Ratio: 0.44
• Price to Book (P/B): 3.74
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 56.34
• Enterprise Value/Market Cap: 0.55
• Enterprise Value/Revenue: 0.13
• Enterprise Value/Gross Profit: 2.34
• Enterprise Value/Ebitda: 2.07
• 1Y Price Target: $45.67
• Price Target Upside: 10.61% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 75 Outperform
• Price Target: $47.00 ▲(13.83%Upside)

Barrett Business Services shows strong financial growth with a stable balance sheet and positive earnings call sentiment. However, negative cash flow and fair valuation metrics temper the score. The slight positive momentum from technical indicators and the strategic corporate events further support the stock's outlook, though challenges in staffing and macroeconomic uncertainties pose some risks.

Positive Factors

Financial Performance

The company's gross billings increased 9.5% YOY in Q1/25, driven by a 7.6% increase in average worksite employees and a strong number of new client additions.

Investment Rating

Analyst maintains an OUTPERFORM investment rating on BBSI shares with a 12-month price target of $45, suggesting a 14% upside.

Market Expansion

The company plans to grow through expanding in white space by adding sales teams to existing branches and expand through the asset light model in new geographies.

Negative Factors

Earnings Forecast

The company’s 2025 outlook includes gross billings growth of 7-9% and worksite employees growth of 4-6%, showing solid business performance despite economic uncertainty.

Economic Challenges

Management maintained prior guidance for 2025, but economic headwinds led to a reduction in non-GAAP EPS forecasts for 2025 and 2026.

Barrett Business Services Business Overview & Revenue Model

Company Description

Barrett Business Services, Inc. provides business management solutions for small and mid-sized companies in the United States. The company develops a management platform that integrates a knowledge-based approach from the management consulting industry with tools from the human resource outsourcing industry. It offers professional employer services under which it enters into a client services agreement to establish a co-employment relationship with each client company, assuming responsibility for payroll, payroll taxes, workers' compensation coverage, and other administration functions for the client's existing workforce. The company also provides staffing and recruiting services, such as on-demand or short-term staffing assignment, contract staffing, direct placement, and long-term or indefinite-term on-site management services. It serves electronics manufacturers, light-manufacturing industries, agriculture-based companies, transportation and shipping enterprises, food processors, telecommunications companies, public utilities, general contractors in various construction-related fields, and professional services firms. The company was incorporated in 1965 and is headquartered in Vancouver, Washington.

How the Company Makes Money

BBSI generates revenue primarily through its comprehensive suite of business management solutions. The company's key revenue streams include fees from payroll processing services, which involve managing payroll functions for client businesses. Additionally, BBSI earns money from its human resources consulting services, where it provides expertise in employee management, benefits administration, and compliance with labor regulations. Risk management and workers' compensation services also contribute significantly to the company's revenue, as BBSI helps clients reduce liability and manage claims. Partnerships with insurance carriers and other service providers play a critical role in enhancing BBSI's offerings and expanding its market reach, further boosting its earnings.

Barrett Business Services Financial Statement Overview

Summary

Barrett Business Services displays strong financial performance with consistent revenue growth and solid profitability margins. The balance sheet shows a stable financial position with low leverage and efficient equity utilization. However, challenges in cash flow generation, reflected by negative free cash flow in the TTM period, necessitate strategic focus for future improvements.

Income Statement

The income statement shows a strong overall performance with consistent revenue growth over the years. The TTM (Trailing-Twelve-Months) data indicates a gross profit margin of 21.71% and a net profit margin of 4.45%, reflecting robust profitability. The EBIT and EBITDA margins of 5.15% and 6.43%, respectively, also support a stable profit trajectory. However, the slight decline in EBIT compared to previous years suggests a need to monitor operational efficiency.

Balance Sheet

The balance sheet reflects a healthy financial position with a debt-to-equity ratio of 0.11, indicating low leverage. The equity ratio stands at 27.40%, demonstrating a solid equity base relative to total assets. Return on equity (ROE) is 24.42%, showcasing efficient utilization of shareholder funds. However, a slight decrease in stockholders' equity from the previous period might require attention to maintain equity stability.

Cash Flow

Cash flow analysis reveals some challenges with a negative free cash flow in the TTM period, indicating potential issues in cash generation post-capital expenditures. The operating cash flow to net income ratio is 0.12, suggesting limited cash flow from operations relative to net income. Despite this, the company has managed a positive operating cash flow trend over previous years, which is promising for future cash flow improvements.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.17B	1.14B	1.07B	1.05B	955.17M	880.82M
	Gross Profit
254.40M	253.25M	242.53M	234.84M	204.51M	182.91M
	EBIT
60.31M	59.78M	60.65M	58.98M	43.92M	36.15M
	EBITDA
75.30M	78.25M	76.26M	78.63M	64.40M	55.93M
	Net Income Common Stockholders
52.11M	52.99M	50.61M	47.27M	38.08M	33.77M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
99.14M	153.06M	152.19M	159.75M	166.17M	169.93M
	Total Assets
778.57M	745.51M	721.54M	686.94M	746.95M	774.95M
	Total Debt
23.16M	21.45M	21.21M	21.18M	25.30M	27.69M
	Net Debt
-8.82M	-33.92M	-49.95M	-70.24M	-44.11M	-41.00M
	Total Liabilities
565.22M	524.10M	522.40M	509.10M	538.42M	576.72M
	Stockholders Equity
213.35M	221.40M	199.14M	177.84M	208.53M	198.24M
Cash Flow		Free Cash Flow
-9.58M	-4.07M	55.40M	11.80M	-22.26M	-36.52M
	Operating Cash Flow
6.32M	10.09M	67.22M	27.78M	-15.46M	-27.91M
	Investing Cash Flow
-7.31M	38.78M	-55.19M	61.15M	-112.86M	4.14M
	Financing Cash Flow
-43.82M	-41.13M	-44.57M	-60.18M	-26.89M	-15.73M

Barrett Business Services Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 41.29
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BBSI, the sentiment is Neutral. The current price of 41.29 is below the 20-day moving average (MA) of 41.80, above the 50-day MA of 40.98, and above the 200-day MA of 40.32, indicating a neutral trend. The MACD of 0.17 indicates Positive momentum. The RSI at 47.16 is Neutral, neither overbought nor oversold. The STOCH value of 36.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for BBSI.

Barrett Business Services Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KFY	77 Outperform	$3.55B	14.31	13.92%	2.79%	-3.27%	62.57%
BBSI	75 Outperform	$1.08B	21.15	25.86%	0.76%	8.41%	7.93%
KFRC	71 Outperform	$768.86M	15.57	31.45%	3.78%	-6.38%	-12.32%
Sector *	66 Neutral	$4.51B	12.22	5.40%	3.63%	4.14%	-12.01%
TNET	63 Neutral	$3.81B	22.65	162.14%	1.40%	1.50%	-44.95%
NSP	53 Neutral	$2.31B	36.62	48.65%	3.91%	1.90%	-60.33%
KELYA	51 Neutral	$419.95M	11.43	-1.60%	2.50%	-3.49%	-140.04%

Barrett Business Services Corporate Events

Barrett Business Services Holds Annual Stockholder Meeting

On June 2, 2025, Barrett Business Services held its Annual Meeting of stockholders, where several key proposals were voted on. Nine directors were elected to serve until the 2026 meeting, and the compensation for executive officers was approved in a non-binding vote. Additionally, the selection of Deloitte and Touche LLP as the independent registered public accounting firm for 2025 was ratified.

The most recent analyst rating on (BBSI) stock is a Buy with a $43.00 price target. To see the full list of analyst forecasts on Barrett Business Services stock, see the BBSI Stock Forecast page.

Barrett Business Services Appoints New Chairman of the Board

On June 4, 2025, Barrett Business Services, Inc. announced the appointment of Joseph S. Clabby as the new Chairman of the Board, effective June 2, 2025, succeeding Anthony Meeker, who will remain as a board member. Clabby, who joined the board in September 2022 and became Vice Chairman in December 2024, brings extensive industry experience from his previous roles at ACE Limited and Chubb. This leadership transition is expected to guide BBSI forward, building on its strong foundation and momentum.

The most recent analyst rating on (BBSI) stock is a Buy with a $43.00 price target. To see the full list of analyst forecasts on Barrett Business Services stock, see the BBSI Stock Forecast page.

Barrett Business Services Announces Quarterly Dividend

On May 7, 2025, Barrett Business Services, Inc. (BBSI) announced a quarterly cash dividend of $0.08 per share, payable on June 6, 2025. The company reported strong financial results for the first quarter of 2025, with revenues increasing by 10% to $292.6 million and gross billings rising by 9% to $2.09 billion. Despite a net loss of $1.0 million, BBSI experienced record gross and net worksite employee additions and maintained high client retention. The company remains optimistic about navigating macroeconomic uncertainties and continues to focus on sustainable growth and long-term value.

Barrett Business Services Appoints New Board Member

On April 7, 2025, Barrett Business Services, Inc. appointed Mark S. Finn to its Board of Directors, with his tenure effective immediately. Finn, who has an extensive background in finance from his 30-year career at T. Rowe Price Group, is expected to bring valuable strategic insights to BBSI as it navigates its next phase of growth and innovation. His appointment is seen as a positive step towards strengthening the company’s leadership and ensuring long-term success.