Robert Half Shares Signal Potential Sector Recovery

After an extended period of stagnation across the staffing services industry, Robert Half International is showing clear signs of a pulse. The company has reported sequential growth for the first time since early 2022, a development market participants are interpreting as a potential bottoming signal. The critical question remains whether this initial glimmer of hope is sufficient to put the stock on a sustained upward trajectory.

Key Q4 2025 Figures:
* Revenue: $1.302 billion
* Earnings Per Share: $0.32 (expected: $0.30)
* Operating Cash Flow: $183 million (an 18% year-over-year increase)
* Q1 2026 Revenue Guidance: $1.26 billion to $1.36 billion

The financial community's response to the earnings report was swift. BMO Capital raised its price target on the stock to $35.00 from $31.00, noting a discernible improvement in the macroeconomic backdrop for professional staffing services. Truist Securities reaffirmed its buy rating, maintaining a $40.00 price target.

Increased trading volume observed in late January suggests investors are acknowledging the positive weekly sales trends, which have continued into the opening month of the new year. This activity appears to reflect a growing market belief that the worst may finally be over for the company.

Should investors sell immediately? Or is it worth buying Robert Half?

Underlying Momentum Shows Improvement

While total revenue for the fourth quarter of 2025 still declined approximately 6% compared to the prior-year period, the results surpassed analyst expectations. The crucial detail lies in the quarter-to-quarter comparison: both the core permanent placement business and the company as a whole returned to sequential growth.

The Protiviti division, which focuses on business consulting, provided significant support to the overall result, posting quarterly revenue of $479 million. The concurrent 18% jump in operating cash flow to $183 million underscores the firm's resilient financial health despite the previously challenging market conditions.

Temporary Tax Headwinds Impact Near-Term Profit

For the current first quarter of 2026, management anticipates revenue in the range of $1.26 billion to $1.36 billion. However, the forecast for earnings per share is comparatively modest, projected between $0.08 and $0.18. This is not due to an operational setback but rather an unusually high expected effective tax rate of up to 58%, stemming from the accounting treatment of expiring stock-based compensation programs.

If the current recovery in demand persists, the company is targeting a return to genuine year-over-year revenue growth by the third quarter of 2026. Capital expenditures for cloud infrastructure and property are planned to remain stable for the full year, estimated between $70 million and $90 million.