Key Takeaways
💸 Kforce delivers a 3.87% dividend yield with 11 consecutive years of increases and a 5-year CAGR of 14.14%, supported by a sustainable 60% payout ratio.
💼 Strong operating and free cash flow, with $73.95 million and $64.1 million respectively over the trailing twelve months, ensuring ample coverage for dividends and buybacks.
📊 Analysts maintain a hold rating with a consensus price target of $53.67, reflecting cautious optimism despite a softer earnings quarter and reduced revenue guidance.
Last Update 5/27/25
Kforce Inc. (NYSE: KFRC) is a professional staffing firm specializing in technology and finance talent solutions, with a long-standing focus on disciplined execution and returning capital to shareholders. Based in Tampa, the company has steadily built a track record of consistent dividend growth, strong free cash flow, and prudent financial management, even amid broader macroeconomic pressures.
With a dividend yield approaching 4% and a payout ratio of 60%, Kforce offers income stability backed by an efficient, shareholder-friendly approach. Despite a challenging year marked by revenue softness and cautious hiring trends, leadership remains focused on long-term strategy and maintaining operational strength.
Recent Events
Kforce Inc. has been quietly making moves that should catch the attention of dividend-focused investors. In early 2025, the company posted fourth-quarter revenue of $343.8 million, rounding out the full year with earnings per share at $2.68. Solid, dependable numbers. But what really stood out? For the sixth year in a row, Kforce raised its quarterly dividend. That kind of consistency speaks volumes about management’s confidence in the business. Even with a tough macro backdrop and a shifting labor market, Kforce stayed the course.
Key Dividend Metrics
💰 Dividend Yield: 3.87%
📈 Annual Dividend: $1.56 per share
🧮 Payout Ratio: 60%
📅 Ex-Dividend Date: June 13, 2025
💵 Next Payment Date: June 27, 2025
🔁 Dividend Growth Streak: 11 years
📊 5-Year Dividend CAGR: 14.14%
Dividend Overview
What sets Kforce apart in the dividend space is a blend of yield and reliability. Right now, the stock is yielding just under 4%. That’s no small feat, especially when you consider how compressed yields are across the broader market. It puts Kforce firmly in the sweet spot for investors hunting for steady income.
At $1.56 per share annually, the dividend is comfortably covered. With a payout ratio sitting at 60%, the company is leaving itself breathing room to manage its capital without putting too much strain on earnings. That balance—rewarding shareholders while still keeping the lights on for internal investment—is something dividend investors should always keep an eye on.
Dividend Growth and Safety
Growth investors and income seekers don’t always agree, but Kforce manages to appeal to both camps. Over the last five years, the dividend has grown at a compound annual rate north of 14%. That’s not just steady; it’s aggressive in a good way. It suggests a business with confidence in its cash flows and a commitment to shareholders that goes beyond just cutting a quarterly check.
What gives Kforce the ability to support this kind of dividend growth? Start with a strong return on equity, sitting at over 31%, which tells us the company is squeezing good returns out of its capital. Then add in free cash flow—$72 million over the trailing twelve months. That’s real, tangible money that can go toward dividends, buybacks, or whatever direction management believes will return the most value.
Even with short-term revenue headwinds and a few bumps in earnings, the company’s dividend looks secure. There’s no sign of stretch or strain. If anything, there’s still room for growth, particularly as business stabilizes and the hiring environment starts to shift back in favor of firms like Kforce. For those building a portfolio with income as a central pillar, this kind of setup is worth noting.
Cash Flow Statement
Kforce Inc. generated $73.95 million in operating cash flow over the trailing twelve months, a moderate decline from previous years but still strong relative to the company’s earnings. This cash flow comfortably covers the dividend and supports ongoing share repurchases. Capital expenditures were modest at $9.85 million, keeping free cash flow healthy at $64.1 million—plenty of cushion for a company with a consistent dividend track record.
The financing side tells a clearer story: Kforce continues to prioritize shareholder returns, repurchasing over $60 million in stock. Debt activity was notable as well, with $365 million issued and $340 million repaid, likely tied to short-term funding and liquidity management rather than long-term leverage. The result is a minimal end cash balance of $444,000, not unusual for a company that efficiently allocates capital and keeps cash lean. While the cash position appears low, the cash flow engine remains intact and well-tuned to support current financial obligations and dividend payouts.
Analyst Ratings
📉 Kforce Inc. has recently seen a shift in how analysts are sizing up the stock. After posting earnings per share of $0.45—just shy of the expected $0.48—and reporting a 6.2% decline in revenue year-over-year, a few firms decided it was time to adjust their outlooks. That modest earnings miss and the softness in top-line growth seem to have nudged some caution into the room.
🔻 UBS dropped its price target from $47 to $40, holding onto its neutral view of the stock. Similarly, Truist trimmed its target from $58 to $50, also maintaining a hold rating. These changes point to some skepticism about near-term momentum, especially with the hiring environment still working through its own post-pandemic hangover.
🔍 That said, not all the news is downbeat. The average analyst consensus still lands at a price target of $53.67. That’s well above where shares are trading today, hinting that while analysts may be dialing down expectations in the short run, there’s still a belief in Kforce’s longer-term positioning. The overall tone is one of wait-and-see—not bullish, not bearish, just carefully watching how the next few quarters unfold.
Earning Report Summary
Slower Top-Line, Still Solid
Kforce wrapped up 2024 with fourth-quarter revenue coming in at $343.8 million. That’s a step down from $363.4 million the year before, and the full-year total landed at $1.41 billion compared to $1.53 billion in 2023. It’s clear that demand softness across the staffing industry continues to weigh on results, especially in the Technology and Finance & Accounting segments. Technology revenue slipped 6.6% year-over-year, while the Finance side saw a steeper drop of more than 23%.
Even with these top-line challenges, the company stayed profitable. Net income for Q4 was $11.1 million, or $0.60 per share, down from $0.82 a year ago. For the full year, earnings per share came in at $2.68, a modest decline from the $3.13 posted in 2023. Margins held up reasonably well despite the revenue pressure, with gross margins easing slightly due to changes in the revenue mix.
Steady Hands at the Helm
Leadership acknowledged the softness in client demand but struck a confident tone about Kforce’s strategic positioning. The focus remains on long-term client relationships and tech-driven talent solutions. Management emphasized their commitment to returning capital to shareholders, and that’s not just talk—Kforce returned $64.7 million in 2024 through a mix of dividends and share buybacks.
Looking ahead, guidance for Q1 2025 suggests revenue between $330 million and $338 million, with earnings per share expected to land somewhere between $0.44 and $0.52. While that’s not flashy, it’s a steady approach in a market that’s been anything but predictable. Leadership made it clear they’re playing the long game, keeping an eye on stability and future positioning rather than chasing short-term numbers.
Management Team
Kforce’s executive team is led by CEO Joseph Liberatore, who has been part of the organization since 2004 and took on the CEO role in 2022. His leadership has emphasized agility, modernization, and a strong alignment with client needs, steering the company through industry evolution and digital transformation. Liberatore continues to push the business toward delivering more value in tech-driven and finance-focused staffing.
Supporting him is CFO David Kelly, whose focus on financial strategy and discipline has helped maintain the company’s strong balance sheet and consistent cash generation. Denis Edwards, the Chief Information Officer, has played a key role in enhancing the company’s IT capabilities, ensuring Kforce stays competitive in a tech-first hiring environment. Michael Blackman leads corporate development and growth initiatives, while Manish Mohan, as Chief Global Talent Officer, is at the helm of Kforce’s recruiting operations and talent programs. This team collectively ensures that Kforce remains competitive, responsive, and built for long-term resilience.
Valuation and Stock Performance
Shares of Kforce are trading around $41 as of late May 2025, which reflects a significant retreat from earlier highs. The current market cap sits just under $934 million, and its price-to-earnings ratio is close to 19.6. That valuation puts it on par with many of its peers, particularly in a sector that has been under pressure from broader economic softness and uncertainty around corporate hiring trends.
The stock has declined more than 30% over the past year, a move that mirrors many cyclical staffing firms dealing with tighter client budgets. Despite this pullback, the average analyst price target hovers near $52, suggesting there’s still belief in a turnaround or at least a stabilization. With a dividend yield near 3.9%, Kforce continues to offer steady income, and its healthy return on equity above 30% suggests the business remains efficient even as revenue growth moderates. Operating cash flow, consistently positive, adds to the case that the fundamentals are still intact even if sentiment is cautious.
Risks and Considerations
Investing in Kforce means being aware of the broader economic picture. The staffing industry doesn’t move in isolation—it’s directly impacted by corporate hiring plans, which ebb and flow with economic cycles. When companies pause hiring or trim budgets, firms like Kforce feel it in real time. That sensitivity makes quarterly results volatile and tough to predict with precision.
There’s also real competition in the space. Traditional firms and tech-driven platforms alike are all chasing a limited number of client dollars. Price pressure and margin compression are ongoing concerns. Kforce also relies on a set of core clients for a meaningful share of revenue, so client concentration is a risk worth monitoring. Regulatory shifts, especially related to labor laws and worker classifications, could increase compliance costs or alter how business is done. Technology, while a strength, is also a moving target. Staying ahead means constant investment, and the risk of being outpaced by newer platforms is always present.
Final Thoughts
Kforce Inc. remains a steady hand in the professional staffing world, blending industry experience with a commitment to innovation. The leadership team’s focus on long-term strategy rather than just quarterly numbers gives the company a foundation for navigating a complicated and fast-changing employment landscape. While macro headwinds and sector-specific challenges continue to shape the short-term outlook, Kforce’s ability to generate free cash flow, reward shareholders, and remain efficient speaks to the underlying strength of its model.
As hiring trends begin to shift again and digital transformation continues to fuel demand for skilled talent, Kforce appears well-positioned to adapt. Investors looking for exposure to the staffing sector with a reliable dividend and experienced management might find this company fits the profile, especially if broader conditions stabilize or improve.