Education
About Us
Working with TipRanks
Follow Us
HireQuest, Inc. (HQI)
NASDAQ:HQI
Top Page
HireQuest
(NASDAQ:HQI)
66Neutral
Positive Factors
Financial Performance
Q3/24 adjusted EBITDA increased 32% YOY to $4.9 million, which exceeded estimates and marked the highest quarterly adjusted EBITDA since Q3/22.
Revenue Growth
Total revenue (including service revenue) increased 1.6% YOY to $9.4 million, exceeding the estimate of $8.9 million and the consensus of $9.0 million.
Negative Factors
Net Loss
HireQuest reported a GAAP net loss per share of ($0.16) for Q3/24 due to a one-time non-cash impairment charge for the acquired MRINetwork assets.
HireQuest (HQI) vs. S&P 500 (SPY)
Market Cap
$171.08M
Dividend Yield1.96%
Average Volume (3M)17.86K
Price to Earnings (P/E)46.3
Beta (1Y)0.93
Revenue Growth-8.67%
EPS Growth-40.72%
CountryUS
Employees96
SectorIndustrials
Sector Strength65
IndustryStaffing & Employment Services
Share Statistics
EPS (TTM)0.26
Shares Outstanding14,000,000
10 Day Avg. Volume18,692
30 Day Avg. Volume17,863
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)5.09
Price to Cash Flow (P/CF)11.10
P/FCF Ratio10.70
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$16.00Price Target Upside34.45% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
HireQuest Business Overview & Revenue Model
Company DescriptionHireQuest, Inc. (HQI) is a publicly traded staffing and workforce solutions provider operating primarily in the temporary staffing sector. The company specializes in connecting businesses with a flexible workforce through its network of franchised offices across the United States. HireQuest offers a range of staffing services, including temporary labor, industrial staffing, and permanent placement solutions, catering to industries such as construction, hospitality, light industrial, and healthcare.
How the Company Makes MoneyHireQuest generates revenue primarily through its franchising model, where it licenses its brand and business systems to independent operators who run local staffing offices. The company earns money by receiving royalty fees from these franchisees, typically based on a percentage of the franchisee's gross billings. Additionally, HireQuest may earn revenue from providing back-office support services, such as payroll processing and risk management, to its franchisees. Significant growth in revenue can be attributed to strategic acquisitions and expanding its franchise network, which increases the company's geographical footprint and market reach.
HireQuest Financial Statement Overview
Summary
HireQuest demonstrates a solid financial foundation with strong cash flows and a healthy balance sheet. While the income statement shows some weaknesses with declining margins and inconsistent revenue growth, the company's low leverage and efficient cash management are notable strengths. Maintaining profitability and revenue growth will be key areas to focus on to enhance overall financial performance.Income Statement
The income statement shows a mixed performance. Gross profit margins are strong as gross profit equals total revenue, indicating no cost of goods sold. However, net profit margin has decreased from prior years, going from 43.3% in 2020 to 10.6% in 2024, suggesting rising operating costs or other expenses. Revenue growth has been inconsistent, with fluctuations over the years, notably decreasing by 8.7% from 2023 to 2024. EBIT and EBITDA margins have also seen a decline, reflecting challenges in maintaining operational efficiency.72
Positive
Balance Sheet
The balance sheet is relatively strong, with a healthy equity ratio of 68.9% in 2024, indicating a stable financial structure. The debt-to-equity ratio improved significantly from prior years, dropping to 0.11 in 2024 from higher levels, showing reduced financial leverage. However, the return on equity has decreased to 5.7% in 2024 from higher levels in previous years, signaling a decline in profitability efficiency.78
Positive
Cash Flow
Cash flow analysis reveals robust operating cash flow, with a significant free cash flow generation of $12.2 million in 2024. The operating cash flow to net income ratio is strong at 3.35, indicating efficient cash conversion. The free cash flow growth has been positive, although the pace has slowed, reflecting potential challenges in sustaining growth. Overall, cash flow management appears solid, providing a cushion for future investments or downturns.81
Very Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 36.28M | 34.60M | 37.88M | 30.95M | 22.76M | 13.81M | Gross Profit |
| 34.19M | 34.60M | 37.88M | 28.91M | 22.59M | 13.81M | EBIT |
| 7.17M | 4.37M | 10.64M | 16.04M | 7.66M | 4.98M | EBITDA |
| 4.90M | 5.76M | 11.65M | 16.28M | 9.20M | 6.71M | Net Income Common Stockholders |
| 1.47M | 3.67M | 6.13M | 12.46M | 11.85M | 5.36M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 53.56K | 2.22M | 1.34M | 3.05M | 1.26M | 13.67M | Total Assets |
| 9.16M | 94.01M | 103.83M | 103.28M | 77.35M | 49.10M | Total Debt |
| 913.15K | 6.83M | 14.77M | 16.54M | 3.24M | 0.00 | Net Debt |
| 859.58K | 4.61M | 13.42M | 13.49M | 1.98M | -13.67M | Total Liabilities |
| 10.75M | 29.21M | 41.09M | 45.03M | 30.62M | 12.73M | Stockholders Equity |
| -1.58M | 64.80M | 62.73M | 58.25M | 46.73M | 36.36M |
| Cash Flow | Free Cash Flow | ||||
| 11.78M | 12.22M | 10.13M | 15.40M | 15.41M | 9.12M | Operating Cash Flow |
| 12.22M | 12.29M | 10.62M | 16.88M | 17.38M | 10.88M | Investing Cash Flow |
| -6.84M | 44.00K | -7.08M | -23.57M | -29.45M | 36.37K | Financing Cash Flow |
| -4.87M | -11.21M | -5.24M | 8.49M | -347.17K | -1.44M |
HireQuest Technical Analysis
Negative
11.90
Price Trends
13.55
Negative
13.87
Negative
13.56
Negative
Market Momentum
-0.25
Positive
35.91
Neutral
40.67
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HQI, the sentiment is Negative. The current price of 11.9 is below the 20-day moving average (MA) of 13.45, below the 50-day MA of 13.55, and below the 200-day MA of 13.56, indicating a bearish trend. The MACD of -0.25 indicates Positive momentum. The RSI at 35.91 is Neutral, neither overbought nor oversold. The STOCH value of 40.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HQI.
HireQuest Risk Analysis
HireQuest disclosed 43 risk factors in its most recent earnings report. HireQuest 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
HireQuest Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $2.74B | 19.53 | 6.67% | 5.25% | -5.61% | 77.92% | |
66 Neutral | $171.08M | 46.32 | 6.15% | 1.96% | -8.67% | -40.72% | |
62 Neutral | $8.05B | 13.60 | 4.04% | 3.11% | 3.70% | -14.19% | |
61 Neutral | $2.75B | 16.39 | 9.55% | ― | -7.88% | -14.39% | |
60 Neutral | $5.51B | 22.06 | 16.96% | 4.05% | -9.33% | -37.06% | |
56 Neutral | $464.49M | 11.43 | -0.05% | 2.26% | -10.42% | -101.51% | |
44 Neutral | $166.07M | ― | -32.53% | ― | -17.78% | -820.48% |
* Industrials Sector Average
Performance Comparison
HQI
HireQuest
11.90
-0.88
-6.89%
KELYA
Kelly Services
13.17
-10.81
-45.08%
MAN
ManpowerGroup
57.88
-14.30
-19.81%
ASGN
ASGN
63.02
-39.22
-38.36%
RHI
Robert Half
54.55
-21.06
-27.85%
TBI
Trueblue
5.31
-6.92
-56.58%
HireQuest Earnings Call Summary
Earnings Call Date: Mar 27, 2025 | % Change Since: -11.46% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a challenging year for HireQuest, with notable declines in revenue, system-wide sales, and franchise royalties. However, the company achieved profitability, improved SG&A cost management, and maintained a strong adjusted EBITDA margin. The continued strategic focus on M&A and operational improvements position the company well for recovery.Highlights
Profitability in Challenging Environment
HireQuest achieved profitability in the fourth quarter of 2024 with total revenues of $8.1 million. For the full year, the company recognized total revenue of $34.6 million and net income of $3.7 million.
SG&A Cost Reduction
There was a significant 22.7% decline in SG&A expenses in Q4 2024 compared to Q4 2023, and a 12.4% decline for the full year. This improvement was largely driven by a reduction in workers' compensation expenses.
Strategic M&A Activities
HireQuest continues to stay active on the M&A front, successfully completing an acquisition at the end of the year, which expanded its staffing footprint and scope of offerings.
Improved Adjusted EBITDA Margin
Adjusted EBITDA margin for the fourth quarter of 2024 was 47% compared to 44% in Q4 2023. For the full year, it was 47% compared to 44% in 2023.
Lowlights
Revenue Decline
Total revenue for the fourth quarter of 2024 was $8.1 million, a decrease of 17.2% compared to $9.8 million in the same quarter last year. Full year revenue was $34.6 million compared to $37.9 million in 2023.
Weak Performance in MRI Network
The MRI network experienced a decline of 18.6% compared to 2023, primarily due to a weak market for permanent placement and executive search solutions.
Decline in System-Wide Sales
System-wide sales for the fourth quarter were $134.8 million compared to $143.5 million in Q4 2023. Full year system-wide sales were $563.6 million compared to $605.1 million in 2023.
Decreased Franchise Royalties
Franchise royalties for Q4 2024 were $7.6 million compared to $8.9 million in the same quarter last year. For the full year, franchise royalties were $32.7 million compared with $35.8 million in 2023.
Company Guidance
During the HireQuest Inc. Fourth Quarter and Year-End 2024 Earnings Call, the company presented several key metrics and insights reflecting its performance and strategic initiatives. HireQuest achieved profitability in Q4 2024 with total revenues reaching $8.1 million, despite challenges in the staffing industry. For the full fiscal year, the company reported total revenue of $34.6 million and net income of $3.7 million. The permanent placement and executive search market underperformed, impacting the MRI network, while temporary staffing and day labor showed relative resilience. The company emphasized cost reduction, noting a 22.7% decline in SG&A expenses in Q4 compared to the previous year, and a 46% reduction in workers' compensation expenses, which are expected to decrease further in 2025. Additionally, adjusted EBITDA for Q4 was $3.8 million, with a margin of 47%. HireQuest remains active in mergers and acquisitions to expand its footprint, and it continues to pay a regular quarterly dividend, reflecting its commitment to shareholder value.HireQuest Corporate Events
Dividends
HireQuest Declares Quarterly Cash Dividend for 2025
Positive
Feb 18, 2025
On February 18, 2025, HireQuest, Inc. announced that its Board of Directors declared a quarterly cash dividend of $0.06 per share, payable on March 17, 2025, to shareholders recorded by March 3, 2025. This move reflects HireQuest’s commitment to returning value to shareholders, although the declaration of future dividends will depend on the company’s financial performance, cash flow, and compliance with legal and financial regulations.
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.