Korn Ferry (NYSE:KFY) versus Recruit (OTCMKTS:RCRUY) Critical Review

Korn Ferry (NYSE:KFY) and Recruit (OTCMKTS:RCRUY) are both business services companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, risk, earnings, profitability, valuation and dividends.

Valuation and Earnings

This table compares Korn Ferry and Recruit’s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Korn Ferry	$2.86 billion	0.88	$209.53 million	$3.39	14.11
Recruit	N/A	N/A	N/A	N/A	N/A

Korn Ferry has higher revenue and earnings than Recruit.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Korn Ferry and Recruit, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Korn Ferry	0	2	3	0	2.60
Recruit	1	1	1	0	2.00

Korn Ferry presently has a consensus price target of $60.25, suggesting a potential upside of 25.99%. Given Korn Ferry’s stronger consensus rating and higher probable upside, equities analysts clearly believe Korn Ferry is more favorable than Recruit.

Profitability

This table compares Korn Ferry and Recruit’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Korn Ferry	6.24%	14.29%	6.90%
Recruit	N/A	N/A	N/A

Institutional & Insider Ownership

92.2% of Korn Ferry shares are held by institutional investors. 1.5% of Korn Ferry shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Korn Ferry beats Recruit on 9 of the 9 factors compared between the two stocks.

About Korn Ferry

Korn Ferry, together with its subsidiaries, provides organizational consulting services worldwide. It operates through four segments: Consulting, Digital, Executive Search, and Recruitment Process Outsourcing (RPO) & Professional Search. The company provides executive search services to recruit board level, chief executive, other senior executive, and general management talent of organizations. It also offers organizational strategy, assessment and succession, leadership and professional development, and total reward services. In addition, the company provides RPO, business project, professional search, and outsource recruiting solutions. Further, the company offers tech-enabled solutions that identify structures, roles, capabilities, and behaviors to drive businesses. It serves public and private companies, and middle market and emerging growth companies, as well as government and non-profit organizations. The company was formerly known as Korn/Ferry International and changed its name to Korn Ferry in January 2019. Korn Ferry was founded in 1969 and is based in Los Angeles, California.

About Recruit

Recruit Holdings Co., Ltd. provides HR technology and business solutions in Japan, the United States, and internationally. It operates through three segments: HR Technology, Matching & Solutions, and Staffing. The HR Technology segment provides various technological solutions that help job seekers and employers in navigating hiring and recruitment. The Matching & Solutions segment offers marketing solutions that provide matching platforms for businesses in various industries, including housing and real estate, beauty, bridal, travel, dining, and others; and SaaS solutions, which are business and management support tools for small and medium-sized companies. It also provides HR solutions that support business clients' recruiting and hiring activities and individual users' job search activities through its job advertising services and placement services. The Staffing segment provides temporary staffing services in Japan, Europe, the United States, and Australia. The company was formerly known as Recruit Co., Ltd. and changed its name to Recruit Holdings Co., Ltd. in October 2012. Recruit Holdings Co., Ltd. was founded in 1960 and is headquartered in Tokyo, Japan.