Kelly Services (NASDAQ: KELYA) and STHREE (OTCMKTS:STREF) are both small-cap business services companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, dividends, analyst recommendations, institutional ownership, valuation and profitability.

Profitability

This table compares Kelly Services and STHREE’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Kelly Services 1.33% 7.92% 3.86%
STHREE N/A N/A N/A

Institutional and Insider Ownership

68.1% of Kelly Services shares are owned by institutional investors. 12.1% of Kelly Services shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings and price targets for Kelly Services and STHREE, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Kelly Services 0 1 0 0 2.00
STHREE 0 0 0 0 N/A

Risk and Volatility

Kelly Services has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500. Comparatively, STHREE has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500.

Valuation & Earnings

This table compares Kelly Services and STHREE’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Kelly Services $5.37 billion 0.22 $71.59 million $2.20 13.85
STHREE $1.32 billion 0.45 N/A N/A N/A

Kelly Services has higher revenue and earnings than STHREE.

Dividends

Kelly Services pays an annual dividend of $0.30 per share and has a dividend yield of 1.0%. STHREE does not pay a dividend. Kelly Services pays out 13.6% of its earnings in the form of a dividend.

Summary

Kelly Services beats STHREE on 8 of the 10 factors compared between the two stocks.

Kelly Services Company Profile

Kelly Services, Inc., together with its subsidiaries, provides workforce solutions to various industries worldwide. The company operates through three segments: Americas Staffing, Global Talent Solutions (GTS), and International Staffing. It provides trained employees for data entry, clerical, and administrative support roles across various industries; schools with instructional and non-instructional employees; support staff for seminars, sales, and trade shows; assemblers, quality control inspectors, and technicians for electronic assembly; maintenance workers, material handlers, and assemblers for light industrial works; scientists, and scientific and clinical research workforce solutions; engineering professionals across various disciplines, including aeronautical, chemical, civil/structural, electrical/instrumentation, environmental, industrial, mechanical, petroleum, pharmaceutical, quality, and telecommunications. The company also provides IT specialists across various disciplines; creative talent in the spectrum of creative services positions; corporate finance departments, accounting firms, and financial institutions with various levels of financial professionals; and legal professionals, including attorneys, paralegals, contract administrators, compliance specialists, and legal administrators. In addition, it provides chefs, porters, and hospitality representatives; and manual workers and semi-skilled professionals in various trade, non-trade, and operational positions. Further, the company provides centrally delivered staffing for large accounts; contingent workforce outsourcing, recruitment process outsourcing, business process outsourcing, and payroll process outsourcing services; contact center staffing solutions; and legal managed services, as well as executive placement, career transition/outplacement, and talent advisory services. Kelly Services, Inc. was founded in 1946 and is headquartered in Troy, Michigan.

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