Roth Capital Comments On BBSI Following An Update Call With Management
In a research report issued today, Roth Capital analyst Jeff Martin maintained a Buy rating on Barrett Business Services (NASDAQ:BBSI) with a price target of $80.
Martin said, “We spoke with BBSI management and continue to have conviction in the resumption of growth acceleration in the coming quarters. We believe the reserve study (which was not prompted by ACE) is nearing completion, which in the light of yesterday’s short report, should prove a key data point for investors.” The analyst continued, “We have a high degree of conviction in BBSI management, which has been undergoing a reserve strengthening program over the course of the past several years, as evidenced by workers’ compensation expense rising from 3.3% of gross payroll to 4.6%. We believe BBSI’s workers’ compensation claims experience is materially better than the industry. Therefore, its reserves are materially lower than the industry. We believe this better experience is due to its branch proximity to clients, active involvement in and monitoring of client safety programs and safety incentive model.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Jeff Martin has a total average return of 6.0% and a 33.3% success rate. Martin has a -42.8% average return when recommending BBSI, and is ranked #1676 out of 3286 analysts.