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Barrett Business Services (BBSI) AI Stock Analysis
Barrett Business Services
(NASDAQ:BBSI)
The score is driven primarily by solid underlying financial strength (notably a conservative balance sheet) and favorable technical trend/momentum. It is tempered by recently weaker margins and inconsistent cash-flow conversion, plus a valuation that is not especially cheap and an earnings outlook that remains cautious as 2026 is guided as a transition year for margins.
Barrett Business Services (BBSI) vs. SPDR S&P 500 ETF (SPY)
- Market Cap
- $809.46M
- Dividend Yield
- 0.96%
- Average Volume (3M)
- 215.85K
- Price to Earnings (P/E)
- 24.0
- Beta (1Y)
- 0.50
- Revenue Growth
- 5.59%
- EPS Growth
- -33.45%
- Country
- US
- Employees
- 141,802
- Sector
- General
- Sector Strength
- 55
- Industry
- Staffing & Employment Services
Barrett Business Services Business Overview & Revenue Model
Company Description
Barrett Business Services, Inc. (BBSI) delivers a range of business management solutions specifically designed for small and mid-sized enterprises across the United States. The company has developed a proprietary management platform that seamlessly i...
How the Company Makes Money
BBSI makes money primarily by providing PEO services in which it becomes a co-employer with its client and delivers a bundled set of employment-related services. The core revenue stream is PEO service revenue, which is typically tied to the client’s...
Barrett Business Services Earnings Call Summary
The call presented a mixed picture: clear commercial momentum (new client growth, product rollout, regional wins, benefits traction and disciplined expenses) offset by margin headwinds driven primarily by rising workers' compensation claim costs and the timing lag for pricing to take effect, an 18% decline in staffing revenue, and a meaningful drop in EPS. Management expects 2026 to be a transition year with margins improving in 2027 as pricing actions fully roll through, while maintaining a conservative near-term outlook and continued investment in products and go-to-market capabilities.
Q2-2026 Updates
Positive Updates
Negative Updates
Company Guidance
BBSI narrowed full‑year guidance, now expecting gross billings growth of 3–4% (vs. prior 3–5%), average WSE growth of 2–3% (vs. prior 2–4%), gross margin of 2.70%–2.75% of gross billings (vs. prior 2.70%–2.85%), and a normalized effective tax rate of 26%–27%; management called 2026 a transition/“low‑watermark” year for margins with improvement expected in 2027 as monthly workers’‑comp pricing rolls through. For context and drivers cited on the call: Q2 gross billings were $2.29B (+2.6% YoY), PEO gross billings +2.8%, staffing revenues down 18% to $14M, PEO WSEs +1%, average billing per WSE/day +2.2%, new client acquisitions +17% YoY, ~4,500 WSEs added from net new clients Y/Y, asset‑light markets +73% (added ~400 WSEs in Q2), East Coast +16%, Mountain +2%, PNW +3%, benefits added ~70 clients and >2,000 participants in Q2, Q2 net income per diluted share $0.52 (vs. $0.70 prior), investment income $1.9M, SG&A down ~2% in Q2 (full‑year SG&A growth expected below gross billings growth), $68M unrestricted cash and investments, no debt, $15M repurchased in Q2 under a $100M program ($40M remaining) and $1.9M paid in dividends this quarter.
Barrett Business Services Financial Statement Overview
Summary
Financial quality is solid but uneven: the balance sheet is a clear strength (low leverage and strong equity/ROE history), while profitability has recently stepped down with TTM margin compression. Cash flow is the main drag due to multi-year variability and weaker recent free-cash-flow conversion versus net income.
Income Statement
72PositiveBalance Sheet
84Very PositiveCash Flow
55Neutral| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.27B | 1.24B | 1.14B | 1.07B | 1.05B | 955.17M |
| Gross Profit | 250.90M | 260.91M | 253.25M | 242.53M | 234.84M | 204.51M |
| EBITDA | 69.27M | 80.09M | 78.25M | 76.26M | 71.67M | 56.36M |
| Net Income | 35.08M | 54.45M | 52.99M | 50.61M | 47.27M | 38.08M |
Balance Sheet | ||||||
| Total Assets | 711.28M | 779.07M | 745.51M | 721.54M | 686.94M | 746.95M |
| Cash, Cash Equivalents and Short-Term Investments | 67.89M | 157.19M | 121.86M | 152.19M | 159.75M | 166.17M |
| Total Debt | 24.50M | 24.45M | 21.45M | 21.21M | 21.18M | 25.30M |
| Total Liabilities | 507.50M | 538.07M | 524.10M | 522.40M | 509.10M | 538.42M |
| Stockholders Equity | 203.78M | 241.00M | 221.40M | 199.14M | 177.84M | 208.53M |
Cash Flow | ||||||
| Free Cash Flow | 15.52M | 47.18M | -4.07M | 55.40M | 11.80M | -22.26M |
| Operating Cash Flow | 36.61M | 65.95M | 10.09M | 67.22M | 27.78M | -15.46M |
| Investing Cash Flow | 27.30M | 30.76M | 38.78M | -55.19M | 61.15M | -112.86M |
| Financing Cash Flow | -70.23M | -52.97M | -41.13M | -44.57M | -60.18M | -26.89M |
Barrett Business Services Technical Analysis
Price Trends
Market Momentum
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BBSI, the sentiment is Positive. The current price of 33.39 is above the 20-day moving average (MA) of 32.27, above the 50-day MA of 32.59, and above the 200-day MA of 32.80, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 58.63 is Neutral, neither overbought nor oversold. The STOCH value of 62.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BBSI.
Barrett Business Services Risk Analysis
Barrett Business Services disclosed 42 risk factors in its most recent earnings report. Barrett Business Services reported the most risks in the "Production" category.
Latest Risks Added
0 New RisksBarrett Business Services Peers Comparison
Overall Rating
- BBSI70Outperform
KFY65Neutral
TNET62Neutral
KELYA56Neutral
TBI52Neutral
NSP48Neutral
Financial Indicators
| Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| BBSI | 70Outperform | $788.37M | 24.03 | 15.76% | 0.96% | 5.59% | -33.45% |
| KFY | 65Neutral | $4.18B | 14.38 | 14.14% | 3.35% | 6.94% | 12.91% |
| TNET | 62Neutral | $2.94B | 18.31 | 174.18% | 1.70% | -3.86% | 34.32% |
| KELYA | 56Neutral | $610.19M | -2.16 | -27.06% | 1.78% | -9.63% | -4468.44% |
| Sector * | 55Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% |
| TBI | 52Neutral | $297.44M | -5.21 | -20.78% | ― | 10.17% | -65.10% |
| NSP | 48Neutral | $1.85B | 635.36 | 5.50% | 4.51% | 2.12% | -83.72% |
* General Sector Average
Performance Comparison
| Show on chart | Ticker | Company Name | Price | Change | % Change |
|---|---|---|---|---|---|
| BBSI | Barrett Business Services | 33.40 | -6.90 | -17.13% | |
| NSP | Insperity | 53.18 | 19.70 | 58.86% | |
| KELYA | Kelly Services | 16.84 | 5.76 | 52.00% | |
| KFY | Korn Ferry | 77.97 | 13.61 | 21.14% | |
| TBI | Trueblue | 9.87 | 4.80 | 94.67% | |
| TNET | TriNet Group | 67.55 | 10.73 | 18.89% |
Barrett Business Services Corporate Events
Barrett Business Services Posts Mixed Q2 2026 Results
NeutralOn August 5, 2026, Barrett Business Services reported second-quarter 2026 results showing modest top-line growth but weaker profitability, as revenues rose 4% to $319.3 million and gross billings increased 3% to $2.29 billion, while net income fell t...
Barrett Business Services Shareholders Expand Stock Incentive Plan
PositiveAt its June 1, 2026 annual meeting, Barrett Business Services, Inc. shareholders approved the Second Amended and Restated 2020 Stock Incentive Plan, raising the share pool for stock-based awards from 2,900,000 to 4,100,000, with no other substantive...
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.
Date of analysis: Aug 06, 2026