Now trading at a price of $10.23, HireRight has moved 16.9% so far today.
HireRight returned losses of -38.0% last year, with its stock price reaching a high of $17.25 and a low of $6.88. Over the same period, the stock underperformed the S&P 500 index by -53.0%. As of April 2023, the company's 50-day average price was $10.53. HireRight Holdings Corporation provides technology-driven workforce risk management and compliance solutions worldwide. Based in Nashville, TN, the small-cap Consumer Discretionary company has 3,078 full time employees. HireRight has not offered a dividend during the last year.
The Company May Be Profitable, but Its Balance Sheet Is Highly Leveraged:
| 2022-02-05 | 2023-03-10 | |
|---|---|---|
| Revenue (k) | $730,056 | $806,668 |
| Gross Margins | 44.0% | 46.0% |
| Operating Margins | 8% | 12% |
| Net Margins | -3.0% | 18.0% |
| Net Income (k) | -$21,303 | $144,574 |
| Net Interest Expense (k) | -$74,815 | -$32,122 |
| Depreciation & Amort. (k) | -$78,357 | -$71,959 |
| Earnings Per Share | -$0.35 | $1.82 |
| EPS Growth | n/a | 620.0% |
| Diluted Shares (k) | 60,821 | 79,443 |
| Free Cash Flow (k) | $53,702 | $112,184 |
| Capital Expenditures | -$6,228 | -$4,456 |
| Net Current Assets (k) | -$800,775 | -$718,626 |
| Long Term Debt (k) | $688,683 | $683,206 |
| Net Debt / EBITDA | 4.34 | 3.11 |
HireRight has exceptional EPS growth and an excellent current ratio. Additionally, the company's financial statements display wider gross margins than its peer group and average operating margins with a positive growth rate. However, the firm has a highly leveraged balance sheet. Finally, we note that HireRight has weak revenue growth and a flat capital expenditure trend and irregular cash flows.
The Market May Be Undervaluing HireRight's Assets and Equity:
HireRight has a trailing twelve month P/E ratio of 8.2, compared to an average of 22.33 for the Consumer Discretionary sector. Based on its EPS guidance of $1.33, the company has a forward P/E ratio of 7.9. The company doesn't provide forward earnings guidance, and the compound average growth rate of its last 2 years of reported EPS is 116.5%. On this basis, HireRight's PEG ratio is 0.07. Using instead the 11.7% weighted average of HireRight's earnings CAGR and the broader market's anticipated 5-year EPS growth rate, the company's PEG ratio is 0.7, which implies that its shares may be underpriced. Additionally, the market is possibly undervaluing HireRight in terms of its equity because its P/B ratio is 1.48 whereas the sector average is 3.12. The company's shares are currently trading -40.2% below their Graham number.
HireRight Has an Average Rating of Buy:
The 9 analysts following HireRight have set target prices ranging from $10.0 to $15.0 per share, for an average of $12.16 with a buy rating. As of April 2023, the company is trading -13.4% away from its average target price, indicating that there is an analyst consensus of some upside potential.
HireRight has an above average percentage of its shares sold short because 12.4% of the company's shares are sold short. Institutions own 92.8% of the company's shares, and the insider ownership rate stands at 9.94%, suggesting a decent amount of insider shareholders. The largest shareholder is General Atlantic, L.P., whose 46% stake in the company is worth $328,484,241.
