Resources Connection (RGP) AI Stock Analysis

• Market Cap: $119.60M
• Dividend Yield: 6.74%
• Average Volume (3M): 439.87K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.29
• Revenue Growth: -10.83%
• EPS Growth: -1669.11%
• Country: US
• Employees: 722
• Sector: Industrials
• Sector Strength: 72
• Industry: Consulting Services
• EPS (TTM): 0.06
• Shares Outstanding: 33,502,155
• 10 Day Avg. Volume: 733,741
• 30 Day Avg. Volume: 439,873
• PEG Ratio: <0.01
• Price to Book (P/B): 0.83
• Price to Sales (P/S): 0.31
• P/FCF Ratio: 10.66
• Enterprise Value/Market Cap: 0.49
• Enterprise Value/Revenue: 0.12
• Enterprise Value/Gross Profit: 0.30
• Enterprise Value/Ebitda: -18.81
• 1Y Price Target: $10.00
• Price Target Upside: 180.11% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): 0.05
• Revenue Forecast (FY): $466.04M

• Rating: 47 Neutral
• Price Target: $3.50 ▼(-1.96% Downside)
• Action: Reiterated Date: 02/10/26
• Date: Action: Reiterated 02/10/26

The score is mainly held back by deteriorating operating performance (revenue contraction and material losses) and weak technical momentum (below key moving averages, negative MACD). Offsetting factors include positive free cash flow and a conservative balance sheet, plus earnings-call evidence of cost reductions and a high dividend yield, though near-term guidance still indicates ongoing pressure.

Positive Factors

Strong liquidity & no debt

A clean balance sheet with ~$90M cash and zero debt provides durable financial flexibility to fund restructuring, maintain dividends, execute the buyback program, and absorb near-term operating shortfalls without refinancing risk. This backing supports strategic options over the next several quarters.

Positive free cash flow generation

Consistent positive trailing‑12‑month operating and free cash flow indicates the business still generates cash from core operations. That cash generation can sustain working capital, support capital returns and fund investments in automation or restructuring while earnings recover, improving long‑term resilience.

Cost discipline and structural savings

Management has already cut run‑rate SG&A and targeted $6–8M in recurring savings, plus a broader 12‑month cost review and automation plans. Those structural expense reductions lower the break‑even revenue level and should sustainably improve margins when demand normalizes, enhancing long‑term profitability.

Negative Factors

Steep consolidated revenue decline

An ~18% YoY revenue drop signals durable demand weakness across core offerings. Sustained top‑line contraction reduces operating leverage, erodes scale benefits, and can lengthen recovery time as sales cycles and client budgeting normalize, pressuring margins and earnings over multiple quarters.

Sharp decline in core consulting segment

Consulting is a strategic, higher‑value business; a nearly 29% revenue drop and halving of segment EBITDA indicate structural loss of projects or pricing mix. Prolonged weakness here undermines long‑term growth prospects and makes margin recovery harder even if other segments stabilize.

Profitability turned deeply negative

A shift from prior positive earnings to a material net loss erodes equity and retained earnings, constraining reinvestment and limiting organic growth capacity. Even with cash on hand, continued operating losses risk capital depletion or forced tradeoffs between investment, dividends, and buybacks over coming quarters.

Resources Connection Business Overview & Revenue Model

Company Description

Resources Connection, Inc. provides consulting services to business customers under the Resources Global Professionals name in North America, Europe, and the Asia Pacific. The company offers services in the areas of transactions, including integration and divestitures, bankruptcy/restructuring, going public readiness and support, financial process optimization, and system implementation; and regulations, such as accounting regulations, internal audit and compliance, data privacy and security, healthcare compliance, and regulatory compliance. It also provides transformations services comprising finance transformation, digital transformation, supply chain management, cloud migration, and data design and analytics. The company has a strategic alliance with Kotter International, Inc. to accelerate joint business development initiatives. The company was formerly known as RC Transaction Corp. and changed its name to Resources Connection, Inc. in August 2000. Resources Connection, Inc. was founded in 1996 and is headquartered in Irvine, California.

How the Company Makes Money

RGP generates revenue primarily through the provision of consulting services, where the company charges clients on an hourly or project basis. Key revenue streams include fees from interim management roles, project consulting engagements, and advisory services. The company also benefits from long-term relationships with clients, leading to repeat business and referrals. Additionally, RGP has strategic partnerships with various firms and organizations, which can enhance its service offerings and expand its market reach. The emphasis on flexible workforce solutions allows RGP to adapt to changing client needs, contributing to consistent revenue generation.

Resources Connection Financial Statement Overview

Summary

Financials are mixed but pressured: the income statement trend is weak with shrinking revenue and a sharp swing to sizable losses, partially offset by a conservative balance sheet (zero/low leverage) and still-positive operating/free cash flow.

Income Statement

Operating performance has deteriorated sharply. Revenue has been shrinking (TTM (Trailing-Twelve-Months) down ~5.2% and annual revenue down materially versus 2023), while profitability flipped from positive in 2022–2024 to deeply negative in 2025, with TTM (Trailing-Twelve-Months) showing a sizable net loss and negative operating profitability. A modestly stable gross margin around the high-30% range is a relative bright spot, but it has not prevented significant bottom-line pressure.

Balance Sheet

Leverage appears manageable, with low total debt relative to equity across the period, which provides balance-sheet flexibility. However, equity has stepped down meaningfully from 2023–2024 levels, and returns to shareholders have turned strongly negative in the most recent periods due to losses. Overall, the balance sheet is not overly levered, but declining equity and weak returns are key risks.

Cash Flow

Cash generation is a relative strength: TTM (Trailing-Twelve-Months) operating cash flow and free cash flow are positive, and TTM (Trailing-Twelve-Months) free cash flow growth is strong. That said, cash flow is not keeping pace with the scale of reported losses (free cash flow covers only part of net losses), and operating cash flow has been far stronger in prior years (notably 2023) than in the latest periods, indicating reduced cash earnings power.

Breakdown	TTM	May 2025	May 2024	May 2023	May 2022	May 2021
Income Statement
Total Revenue	506.74M	551.33M	632.80M	775.64M	805.02M	629.52M
Gross Profit	192.53M	207.42M	246.07M	313.14M	316.64M	241.40M
EBITDA	-3.11M	10.50M	41.30M	84.70M	91.92M	33.41M
Net Income	-132.42M	-191.78M	21.03M	54.36M	67.17M	25.23M
Balance Sheet
Total Assets	289.27M	304.69M	510.91M	532.00M	581.47M	520.64M
Cash, Cash Equivalents and Short-Term Investments	89.81M	86.15M	108.89M	116.78M	104.22M	74.39M
Total Debt	24.61M	25.30M	13.32M	17.73M	75.55M	73.95M
Total Liabilities	94.69M	97.61M	92.15M	117.48M	209.02M	191.10M
Stockholders Equity	194.59M	207.08M	418.76M	414.52M	372.45M	329.55M
Cash Flow
Free Cash Flow	24.00M	16.19M	20.78M	79.62M	46.48M	36.10M
Operating Cash Flow	25.15M	18.90M	21.92M	81.64M	49.44M	39.94M
Investing Cash Flow	-1.35M	-13.57M	-8.55M	3.94M	-2.96M	-3.84M
Financing Cash Flow	-13.96M	-27.73M	-20.71M	-71.91M	-13.37M	-59.46M

Resources Connection Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.57
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RGP, the sentiment is Negative. The current price of 3.57 is below the 20-day moving average (MA) of 4.03, below the 50-day MA of 4.51, and below the 200-day MA of 4.74, indicating a bearish trend. The MACD of -0.25 indicates Positive momentum. The RSI at 36.12 is Neutral, neither overbought nor oversold. The STOCH value of 23.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RGP.

Resources Connection Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FCN	76 Outperform	$4.84B	20.34	13.30%	―	-0.95%	-10.54%
ICFI	74 Outperform	$1.39B	14.16	9.88%	0.65%	-3.81%	-7.05%
HURN	70 Outperform	$2.18B	22.80	19.27%	―	12.50%	29.40%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
FC	51 Neutral	$157.46M	-115.35	-2.08%	―	-7.02%	-86.27%
RGP	47 Neutral	$119.60M	-0.92	-61.44%	6.74%	-10.83%	-1669.11%
FORR	42 Neutral	$104.90M	-0.88	-43.39%	―	-8.73%	-1168.15%

Resources Connection Corporate Events

Resources Connection Implements Executive Retention Incentive Agreement

On February 6, 2026, Resources Connection, Inc. entered into a retention agreement with executive Jennifer Ryu to reinforce leadership continuity and support the company’s ongoing success. The agreement offers three retention payments of $125,000 each in 2026, 2028 and 2029, contingent on her continued employment, with accelerated payout if she is terminated without cause or if a change in control occurs.

The arrangement includes provisions to optimize Ryu’s after-tax benefits if potential excise taxes are triggered, without obligating the company to provide a tax gross-up. The structure underscores Resources Connection’s effort to secure key leadership stability through multi-year financial incentives while managing its own tax exposure and compensation obligations in potential change-of-control scenarios.

The most recent analyst rating on (RGP) stock is a Hold with a $4.50 price target. To see the full list of analyst forecasts on Resources Connection stock, see the RGP Stock Forecast page.

Resources Connection launches cost-cutting plan and dividend

On January 22, 2026, Resources Connection authorized a reduction in its global management and administrative workforce aimed at cutting costs and improving operational efficiency, a move expected to generate annual savings of $6 million to $8 million, with about $3 million in restructuring charges recognized over the third and fourth quarters of fiscal 2026 and the bulk of the workforce reductions completed by the end of that fiscal year. On the same date, the board approved a cash dividend of $0.07 per share on the company’s common stock, payable March 20, 2026 to shareholders of record as of February 20, 2026, underscoring a continued return of capital to investors even as the firm undertakes cost-cutting measures.

The most recent analyst rating on (RGP) stock is a Hold with a $4.50 price target. To see the full list of analyst forecasts on Resources Connection stock, see the RGP Stock Forecast page.