Barrett Business Services (BBSI) AI Stock Analysis

• Market Cap: $945.55M
• Dividend Yield: 0.87%
• Average Volume (3M): 253.93K
• Price to Earnings (P/E): 17.7
• Beta (1Y): 0.77
• Revenue Growth: 9.64%
• EPS Growth: 9.93%
• Country: US
• Employees: 135,727
• Sector: Industrials
• Sector Strength: 72
• Industry: Staffing & Employment Services
• EPS (TTM): 0.79
• Shares Outstanding: 25,624,622
• 10 Day Avg. Volume: 287,688
• 30 Day Avg. Volume: 253,932
• PEG Ratio: 2.68
• Price to Book (P/B): 5.12
• Price to Sales (P/S): 0.99
• P/FCF Ratio: -278.11
• Enterprise Value/Market Cap: 1.05
• Enterprise Value/Revenue: 0.81
• Enterprise Value/Gross Profit: 3.77
• Enterprise Value/Ebitda: 12.16
• 1Y Price Target: $50.00
• Price Target Upside: 35.54% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: $37.00 ▲(0.30% Upside)

Barrett Business Services' overall stock score is driven by strong financial performance and positive corporate events. However, bearish technical indicators and moderate valuation metrics weigh down the score. The optimistic outlook from the earnings call provides some support, but operational efficiency and cash flow challenges remain areas of concern.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective client acquisition, supporting long-term business expansion.

Geographic Expansion

Expanding geographic presence enhances market reach and client base, contributing to sustainable growth and competitive positioning.

Strong Balance Sheet

A strong balance sheet with low leverage provides financial stability and flexibility for future investments and growth initiatives.

Negative Factors

Cash Flow Challenges

Declining cash flow generation can limit the company's ability to invest in growth opportunities and manage operational expenses effectively.

Margin Pressure

Margin pressure from pricing trends and staffing volume can impact profitability, challenging the company's ability to maintain operational efficiency.

Staffing Business Decline

A decline in the staffing segment suggests potential challenges in a key revenue stream, affecting overall business performance and growth.

Barrett Business Services Business Overview & Revenue Model

Company Description

Barrett Business Services, Inc. (BBSI) is a leading provider of comprehensive business management solutions, specializing in human resource management, payroll processing, and risk management services. Operating primarily in the professional employer organization (PEO) sector, BBSI serves small to medium-sized businesses across various industries, including construction, manufacturing, and retail. The company aims to enhance operational efficiency and drive growth for its clients by offering tailored solutions that streamline HR functions, ensure compliance, and improve employee productivity.

How the Company Makes Money

BBSI generates revenue primarily through its PEO services, which involve co-employment agreements where BBSI assumes certain employer responsibilities for its clients. The company charges its clients a fee calculated as a percentage of payroll, which includes various HR services such as payroll processing, benefits administration, and risk management. Additionally, BBSI earns revenue from value-added services, including consulting and training programs designed to improve workforce management. Significant partnerships with insurance providers and benefits vendors also enhance its service offerings and contribute to its earnings by allowing BBSI to offer competitive rates and packages to its clients.

Barrett Business Services Financial Statement Overview

Summary

Barrett Business Services demonstrates solid financial health with consistent revenue growth and profitability. The balance sheet is strong with low leverage, enhancing financial stability. However, the decline in free cash flow growth poses a concern, indicating potential cash management challenges.

Income Statement

Barrett Business Services shows a steady revenue growth rate of 2.06% in the TTM, indicating positive momentum. The gross profit margin is healthy at 21.57%, though slightly lower than previous years. The net profit margin remains stable at 4.48%, reflecting consistent profitability. However, the EBIT and EBITDA margins have decreased, suggesting potential cost pressures or operational inefficiencies.

Balance Sheet

The company maintains a strong balance sheet with a low debt-to-equity ratio of 0.07, indicating low leverage and financial stability. The return on equity is robust at 21.65%, showcasing effective use of equity to generate profits. The equity ratio is solid, reflecting a strong capital structure and low financial risk.

Cash Flow

Cash flow performance is mixed, with a significant decline in free cash flow growth at -331.83% in the TTM. However, the operating cash flow to net income ratio is positive, indicating that the company generates sufficient cash from operations. The free cash flow to net income ratio is healthy at 0.62, suggesting adequate cash generation relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.22B	1.14B	1.07B	1.05B	955.17M	880.82M
Gross Profit	264.02M	253.25M	242.53M	234.84M	204.51M	182.91M
EBITDA	81.81M	78.25M	76.26M	71.67M	56.36M	48.68M
Net Income	54.85M	52.99M	50.61M	47.27M	38.08M	33.77M
Balance Sheet
Total Assets	777.92M	745.51M	721.54M	686.94M	746.95M	774.95M
Cash, Cash Equivalents and Short-Term Investments	109.75M	121.86M	152.19M	159.75M	166.17M	169.93M
Total Debt	25.17M	21.45M	21.21M	21.18M	25.30M	27.69M
Total Liabilities	537.78M	524.10M	522.40M	509.10M	538.42M	576.72M
Stockholders Equity	240.15M	221.40M	199.14M	177.84M	208.53M	198.24M
Cash Flow
Free Cash Flow	26.76M	-4.07M	55.40M	11.80M	-22.26M	-36.52M
Operating Cash Flow	43.20M	10.09M	67.22M	27.78M	-15.46M	-27.91M
Investing Cash Flow	37.15M	38.78M	-55.19M	61.15M	-112.86M	4.14M
Financing Cash Flow	-43.02M	-41.13M	-44.57M	-60.18M	-26.89M	-15.73M

Barrett Business Services Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 36.89
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BBSI, the sentiment is Negative. The current price of 36.89 is above the 20-day moving average (MA) of 35.32, below the 50-day MA of 37.91, and below the 200-day MA of 41.69, indicating a neutral trend. The MACD of -0.28 indicates Negative momentum. The RSI at 54.71 is Neutral, neither overbought nor oversold. The STOCH value of 85.19 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BBSI.

Barrett Business Services Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HSII	67 Neutral	―	―	7.47%	1.02%	11.53%	-6.32%
BBSI	66 Neutral	$945.55M	17.71	24.08%	0.87%	9.64%	9.93%
KFRC	66 Neutral	$567.63M	13.98	27.19%	4.99%	-5.91%	-23.01%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
NSP	50 Neutral	$1.47B	87.90	16.04%	6.09%	3.19%	-86.21%
MAN	48 Neutral	$1.36B	-62.91	-1.00%	4.88%	-2.44%	-156.01%
KELYA	46 Neutral	$315.74M	-2.03	-13.11%	3.37%	0.46%	-477.90%

Barrett Business Services Corporate Events

Barrett Business Services Announces Quarterly Cash Dividend

On November 5, 2025, Barrett Business Services announced a quarterly cash dividend of $0.08 per share, payable on December 5, 2025. The company reported strong financial results for the third quarter of 2025, with revenues increasing by 8% to $318.9 million and gross billings rising by 9% to $2.32 billion. The growth was attributed to new client additions and an increase in worksite employees. BBSI also repurchased $7.5 million of its stock and maintained a debt-free status with $109.8 million in cash and investments. The company remains focused on disciplined execution and investment in its people and technology to support long-term growth.

Barrett Business Services Amends Credit Facility with Wells Fargo

On September 22, 2025, Barrett Business Services, Inc. amended its credit facility with Wells Fargo Bank. The amendment extends the company’s $50 million revolving credit line from July 1, 2026, to August 1, 2028, and reduces the unused commitment fee from 0.35% to 0.30% per annum. This change reflects a strategic financial adjustment, potentially enhancing the company’s liquidity and operational flexibility, while all other material terms remain unchanged.