DHI Group (DHX) AI Stock Analysis

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DHI Group

(NYSE:DHX)

Rating:62Neutral

Price Target:

$2.00

▲( 3.63% Upside)

DHI Group's overall stock score reflects strengths in technical analysis and financial management, particularly in cash flow and cost efficiency. However, significant challenges in profitability, declining revenues, and valuation concerns weigh on the score. The earnings call highlighted strategic initiatives and optimism for future growth, but current uncertainties in the tech hiring environment and specific segment challenges pose risks. Overall, the stock's appeal is mixed, with a need for demonstrable improvements in profitability and revenue growth.

Positive Factors

Cost Management

Results were positively impacted by restructurings that have removed over $20 million of operating costs, coupled with initiatives to improve product offerings and strengthen sales and marketing.

Financial Performance

Q4/24 results were better than expected, with adjusted EBITDA surpassing consensus expectations and generating a strong margin of 26.3%.

Operational Strategy

DHI has aligned its operations around each brand with dedicated leadership and go-to-market strategies for each business segment, driving greater focus and accountability.

Negative Factors

Bookings Decline

Total bookings are unlikely to return to growth throughout the year due to the tough macro environment affecting the Dice segment.

Demand Environment

The demand environment for technology talent acquisition tools remains challenging.

Market Challenges

The Dice business continues to struggle with softness in performance, attributed to a down part of the business cycle.

DHI Group (DHX) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$94.09M

Dividend YieldN/A

Average Volume (3M)126.97K

Price to Earnings (P/E)268.9

Beta (1Y)0.56

Revenue Growth-7.42%

EPS Growth-567.61%

CountryUS

Employees414

SectorTechnology

Sector Strength78

IndustryStaffing & Employment Services

Share Statistics

EPS (TTM)-0.21

Shares Outstanding48,751,220

10 Day Avg. Volume119,460

30 Day Avg. Volume126,974

Financial Highlights & Ratios

PEG Ratio-3.93

Price to Book (P/B)0.73

Price to Sales (P/S)0.00

P/FCF Ratio11.95

Enterprise Value/Market Cap1.32

Enterprise Value/Revenue0.21

Enterprise Value/Gross Profit1.06

Enterprise Value/Ebitda1.20

Forecast

1Y Price Target

$6.17

Price Target Upside219.69% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering3

DHI Group Business Overview & Revenue Model

Company DescriptionDHI Group, Inc. (NYSE: DHX) is a leading provider of data, insights, and employment connections for specialized professional communities. The company operates niche career websites that focus on specific industries, including technology, financial services, and healthcare. Through its flagship brands such as Dice and ClearanceJobs, DHI Group serves both job seekers and employers by offering a platform for talent acquisition and career advancement.

How the Company Makes MoneyDHI Group, Inc. generates revenue primarily through recruitment-related services and offerings. The company's key revenue streams include subscription fees from employers who post job listings and access resume databases on its platforms such as Dice and ClearanceJobs. Additionally, DHI Group offers talent management solutions and insights that allow recruiters to find, assess, and hire specialized professionals efficiently. Significant partnerships with industry leaders and technology providers enhance the company's offerings and expand its reach to a broader audience. By leveraging its extensive databases and industry insights, DHI Group helps businesses connect with qualified candidates while supporting professionals in advancing their careers.

DHI Group Financial Statement Overview

Summary

DHI Group shows moderate financial health with strong gross margins but challenges in profitability and revenue growth. The balance sheet is stable with manageable debt levels. Cash flow generation is improving but remains a concern relative to net income. The company needs to focus on improving net profitability and sustaining positive cash flow growth.

Income Statement

Positive

The income statement shows moderate performance with a gross profit margin of 82.60% for TTM, indicating strong cost control relative to revenue. However, the net profit margin is low at 0.18%, reflecting challenges in profitability. Revenue growth is negative at -6.56% compared to the previous period, which is a concern. The EBIT margin is 4.46% and EBITDA margin is 14.05%, indicating reasonable operating efficiency but potential issues with higher non-operating expenses or taxes affecting net income.

Balance Sheet

Positive

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.37, indicating manageable leverage. The return on equity (ROE) is low at 0.22%, suggesting limited effectiveness in generating profits from shareholders' equity. The equity ratio is 51.64%, showing a healthy proportion of equity financing, which provides financial stability.

Cash Flow

Neutral

The cash flow statement reveals a decrease in free cash flow, with a growth rate of 551.20%, indicating improvement over the previous year but still relatively low. The operating cash flow to net income ratio is high at 83.20, showing strong cash earnings. However, the free cash flow to net income ratio is 28.11, indicating limited free cash flow relative to net earnings.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
141.93M	151.88M	149.68M	119.90M	136.88M
	Gross Profit
121.69M	132.09M	132.07M	104.81M	119.83M
	EBIT
6.33M	6.29M	5.56M	357.00K	9.22M
	EBITDA
24.12M	24.02M	20.99M	15.98M	-24.13M
	Net Income Common Stockholders
253.00K	3.49M	4.18M	-402.00K	-30.02M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.70M	4.21M	3.01M	1.54M	7.64M
	Total Assets
221.37M	225.20M	226.70M	221.58M	240.99M
	Total Debt
42.62M	46.55M	38.53M	32.10M	36.70M
	Net Debt
38.92M	42.34M	35.53M	30.56M	29.06M
	Total Liabilities
107.05M	117.66M	120.47M	105.22M	113.42M
	Stockholders Equity
114.33M	107.54M	106.24M	116.36M	127.57M
Cash Flow		Free Cash Flow
7.11M	1.09M	18.06M	14.27M	2.58M
	Operating Cash Flow
21.05M	21.34M	36.03M	28.58M	18.68M
	Investing Cash Flow
-13.93M	-15.31M	-17.66M	-19.30M	-15.90M
	Financing Cash Flow
-7.62M	-4.83M	-16.91M	-15.39M	-542.00K

DHI Group Technical Analysis

Technical Analysis Sentiment

Positive

Last Price1.93

Price Trends

50DMA

1.58

Positive

100DMA

2.00

Negative

200DMA

1.88

Positive

Market Momentum

MACD

0.11

Negative

RSI

58.49

Neutral

STOCH

45.71

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DHX, the sentiment is Positive. The current price of 1.93 is above the 20-day moving average (MA) of 1.68, above the 50-day MA of 1.58, and above the 200-day MA of 1.88, indicating a bullish trend. The MACD of 0.11 indicates Negative momentum. The RSI at 58.49 is Neutral, neither overbought nor oversold. The STOCH value of 45.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DHX.

DHI Group Risk Analysis

DHI Group disclosed 39 risk factors in its most recent earnings report. DHI Group 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 2 New Risks

We have adopted a Section 382 rights plan, which may discourage a corporate takeover. Q4, 2024

Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management. Q4, 2024

DHI Group Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
UPWK	82 Outperform	$2.07B	9.44	49.80%	―	7.21%	396.32%
DHX	62 Neutral	$94.09M	268.89	-7.21%	―	-7.42%	-567.61%
Sector *	61 Neutral	$11.28B	10.16	-6.88%	2.97%	7.41%	-8.93%
MHH	61 Neutral	$87.65M	42.64	2.52%	―	3.93%	―
JOB	51 Neutral	$21.43M	―	-70.70%	―	-17.38%	-1165.13%
HSON	50 Neutral	$24.76M	―	-8.66%	―	-9.28%	-244.22%
ZIP	46 Neutral	$504.47M	225.24	-2897.28%	―	-20.95%	-152.29%

* Technology Sector Average

Performance Comparison

DHX

DHI Group

1.93

-0.27

-12.27%

JOB

GEE Group

0.20

-0.16

-44.44%

HSON

Hudson Global

9.00

-6.72

-42.75%

MHH

Mastech Holdings

7.45

-0.53

-6.64%

UPWK

Upwork

15.75

4.95

45.83%

ZIP

ZipRecruiter

5.43

-4.72

-46.50%

DHI Group Earnings Call Summary

Earnings Call Date:May 07, 2025

(Q1-2025)

% Change Since: 41.91%|

Next Earnings Date:Jul 30, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed picture with significant strengths in cost management, profitability of ClearanceJobs, and positive tech job growth indicators. However, these were offset by challenges such as overall revenue decline, difficulties in the Dice segment, and uncertainties affecting tech hiring. The company's strategic innovations and share repurchase program indicate confidence, but the tech hiring environment and external uncertainties pose challenges.

Q1-2025 Updates

Positive Updates

ClearanceJobs Strong Profitability

ClearanceJobs delivered adjusted EBITDA of $5.7 million, with an adjusted EBITDA margin of 43%. Despite a minor 1% decline in bookings, larger CJ customers remain confident.

AI and Tech Job Growth Indicators

There is a 16% increase in new tech job postings year-over-year, and tech recruiter job postings increased by 36%, signaling a potential rise in tech hiring demand.

Successful Cost Management

DHI Group removed over $20 million of operating costs through three restructurings since May 2023, enhancing profitability and positioning for profitable growth.

Innovation and Recognition

ClearanceJobs received recognition from the White House as a vital partner in national cybersecurity, and Dice launched new product features and improvements.

Share Repurchase Program

DHI Group announced a $5 million share repurchase program, reflecting confidence in the company's strength and resilience.

Negative Updates

Overall Revenue Decline

Total revenue decreased by 10% year-over-year, with total bookings down by 14%.

Dice Segment Challenges

Dice faced a challenging environment with bookings down 20% year-over-year, primarily due to adjusted consumption in a lower demand environment.

Impact of Doge-Related Uncertainty

Doge-related uncertainty affected ClearanceJobs' new bookings and renewals, particularly impacting smaller military contractors and delaying new business relationships.

Goodwill Impairment and Restructuring Charges

The quarter was impacted by a $7.4 million Dice goodwill impairment charge and a $2.3 million restructuring charge.

Tech Hiring Environment

The tech hiring environment remains uncertain, with hiring levels still only around 70% of normal levels compared to 2019.

Company Guidance

During the call, DHI Group provided guidance for fiscal year 2025, projecting full-year revenue between $131 million and $135 million. For the second quarter, the company expects revenue to be between $32 million and $33 million. The company aims for an adjusted EBITDA margin of 24% for the full year, with a strong emphasis on free cash flow conversion. DHI Group has also implemented a $5 million share repurchase program and achieved a leverage ratio of 1x. The company highlighted its strategic focus on two brands, ClearanceJobs and Dice, with ClearanceJobs maintaining a robust adjusted EBITDA margin of 43% and Dice at 18%. Despite a 10% decline in total revenue in the first quarter, DHI Group reported company-wide adjusted EBITDA of $7 million, representing a margin of 22%. The tech hiring environment remains uncertain, but the company remains optimistic about a return to profitable growth as hiring demand normalizes.

DHI Group Corporate Events

Executive/Board ChangesBusiness Operations and Strategy

DHI Group Appoints New CFO and CLO

Positive

Jan 30, 2025

On January 28, 2025, DHI Group, Inc. appointed Gregory Schippers as Chief Financial Officer and E. Jack Connolly as Chief Legal Officer. Schippers, who joined the company in 2014 and served as Interim CFO since November 2024, will oversee financial operations, while Connolly, who joined in 2018 and served as General Counsel since May 2023, will manage legal affairs. Their appointments aim to strengthen the company’s leadership and align legal and financial strategies with its operational goals.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.