May 4, 2009 (Baystreet.ca) --
Employer services company Administaff, Inc. (ASF) said Monday that its first quarter profit fell 38% year-over-year, but still beat estimates, sending its shares soaring.
The Kingwood, Texas-based company reported first quarter net income of $8.2 million, or 33 cents per share, down 38% from $13.2 million, or 51 cents per share, in the year-ago period. Revenue edged up 1% to $462 million from $456.1 million due to higher monthly service fees.
On average, Wall Street analysts expected profits of 29 cents per share on revenue of $466.9 million.
The company said that it placed 1.6% fewer workers during the quarter than last year, but was able to offset the effects because of a reduction in operating expenses.
Administaff shares rallied $3.98, or +15%, in late morning trading Monday.
The Bottom Line
We have been avoiding ASF since our June coverage began, when shares were trading at $27.69. The company now has a dividend yield of 1.97%, based on Friday’s closing price of $26.41. The stock has technical support in the $23 price area. If today's jump can sustain, we see the next level of overhead resistance around the $31-34 price levels. We would remain on the sidelines for now, but we did bump up our ratings a bit this morning.
Administaff, Inc. (ASF) is not recommended at this time, holding a Dividend.com DARS Rating of 3.3 out of 5 stars.
Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.
Newstex ID: 34636716
