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TriNet Group
(NYSE:TNET)
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Rating:68Neutral
Price Target:
$72.00
â–²(2.27% Upside)
Action:Reiterated
Date:08/03/26
TNET scores as moderately attractive: strong technical momentum and supportive guidance/cash generation help the outlook, but the overall score is held back by weakened profitability versus prior years and, most importantly, very high balance-sheet leverage (thin equity cushion). Valuation is reasonable with a modest dividend yield, but sustained revenue/WSE stabilization is a key requirement for a higher score.
Positive Factors
Cash generation
Consistent, sizable operating and free cash flow is a durable strength: it funds dividends, buybacks and strategic investments without relying solely on external financing. Strong cash conversion also supports credibility of earnings and provides a buffer while revenue/margin recovery is executed.
Negative Factors
Very high leverage
Extremely elevated debt relative to equity is a persistent constraint on financial flexibility. High leverage heightens refinancing and interest-rate sensitivity, limits ability to absorb adverse medical-cost or sales shocks, and reduces capacity for sizeable M&A or countercyclical investments.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Consistent, sizable operating and free cash flow is a durable strength: it funds dividends, buybacks and strategic investments without relying solely on external financing. Strong cash conversion also supports credibility of earnings and provides a buffer while revenue/margin recovery is executed.
Read all positive factors
TriNet Group (TNET) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.17B
Dividend Yield1.64%
Average Volume (3M)400.79K
Price to Earnings (P/E)18.5
Beta (1Y)0.89
Revenue Growth-2.83%
EPS Growth26.75%
CountryUS
Employees302,955
SectorIndustrials
Sector Strength72
IndustryStaffing & Employment Services
Share Statistics
EPS (TTM)3.74
Shares Outstanding45,904,740
10 Day Avg. Volume350,574
30 Day Avg. Volume400,792
Financial Highlights & Ratios
PEG Ratio-2.38
Price to Book (P/B)52.56
Price to Sales (P/S)0.57
P/FCF Ratio9.28
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$66.20Price Target Upside-5.97% Downside
Rating ConsensusHold
Number of Analyst Covering7
EPS Forecast (FY)4.84
Revenue Forecast (FY)$4.83B
TriNet Group Business Overview & Revenue Model
Company Description
TriNet Group, Inc. provides comprehensive human capital management services for small and medium-sized businesses in the United States. The company offers multi-state payroll processing and tax administration; employee benefits programs, including...
How the Company Makes Money
TriNet primarily makes money through its PEO model by charging clients fees tied to the employment and HR services it provides for the clients’ workforces. A key revenue stream is service revenue earned for administering payroll and HR functions a...
TriNet Group Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Positive
The call conveyed a cautiously optimistic tone: management highlighted meaningful operational improvements (notably insurance profitability, retention, margin expansion, AI-enabled service gains and raised earnings guidance) and strong cash generation, while acknowledging ongoing top-line pressure from significant WSE declines, flat sales in Q2 and reliance in part on one-time or prior-period items for some of the insurance favorability. Management laid out credible actions (ASCEND hiring, broker channel growth, pricing and product enhancements) to restore sustainable revenue growth, but execution risks and persistent high medical inflation remain near-term constraints.Positive Updates
Improved Insurance Profitability and ICR
Q2 insurance cost ratio (ICR) improved to 86%, a 4-point year-over-year improvement; insurance costs declined 8% YoY and insurance service revenues declined 4% YoY. Management cited stabilized health cost trends in the high single digits and raised full-year ICR guidance (updated range centered below prior guidance, reflecting first-half favorability).
Negative Updates
Decline in Total Revenue
Q2 total revenues were $1.2B, down 5% year-over-year, driven primarily by lower WSE volumes despite pricing gains.
Read all updates
Q2-2026 Updates
Positive
Negative
Improved Insurance Profitability and ICR
Q2 insurance cost ratio (ICR) improved to 86%, a 4-point year-over-year improvement; insurance costs declined 8% YoY and insurance service revenues declined 4% YoY. Management cited stabilized health cost trends in the high single digits and raised full-year ICR guidance (updated range centered below prior guidance, reflecting first-half favorability).
Read all positive updates
Company Guidance
TriNet raised its 2026 earnings outlook, guiding total revenues of $4.75–$4.90B, professional services revenue of $647–$663M, an insurance cost ratio (ICR) roughly in the high‑80s (about 88.5%–89.5%), an adjusted EBITDA margin of 8.5%–9%, GAAP EPS of $2.85–$3.35 and adjusted EPS of $4.50–$5.10. The revision follows Q2 results of $1.2B revenue (‑5% YoY), adjusted EBITDA $128M (10.9% margin), GAAP EPS $1.15 and adjusted EPS $1.55; insurance service revenues down 4% with insurance costs down 8% and a Q2 ICR of 86% (a 4‑point YoY improvement); professional services revenue of $159M (‑8%); interest revenue $12M (‑33%); total WSEs ~300k (‑12% YoY, flat sequential) and co‑employed WSEs ~274k (‑11%); plus $88M net cash from operations, $67M free cash flow (+18%), and $31M returned to shareholders (≈500k shares repurchased for $18M and a $0.29 dividend). Management noted second‑half ICR seasonality (higher H2 ICR), expects to target the high end of its long‑term ICR range, and will accelerate incremental 2026 investments in distribution, benefits and service (including AI).TriNet Group Financial Statement Overview
Summary
Income Statement
54
Neutral
Balance Sheet
33
Negative
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.88B | 5.01B | 5.05B | 4.92B | 4.88B | 4.54B |
| Gross Profit | 933.00M | 886.00M | 952.00M | 1.10B | 1.12B | 937.00M |
| EBITDA | 379.00M | 346.00M | 374.00M | 662.00M | 610.00M | 520.00M |
| Net Income | 175.00M | 155.00M | 173.00M | 375.00M | 355.00M | 338.00M |
Balance Sheet | ||||||
| Total Assets | 3.35B | 3.80B | 4.12B | 3.69B | 3.44B | 3.31B |
| Cash, Cash Equivalents and Short-Term Investments | 358.00M | 287.00M | 360.00M | 352.00M | 430.00M | 747.00M |
| Total Debt | 950.00M | 942.00M | 1.02B | 1.14B | 552.00M | 547.00M |
| Total Liabilities | 3.22B | 3.74B | 4.05B | 3.62B | 2.67B | 2.43B |
| Stockholders Equity | 125.00M | 54.00M | 69.00M | 78.00M | 775.00M | 881.00M |
Cash Flow | ||||||
| Free Cash Flow | 344.00M | 306.00M | 201.00M | 470.00M | 506.00M | 178.00M |
| Operating Cash Flow | 370.00M | 303.00M | 279.00M | 545.00M | 562.00M | 218.00M |
| Investing Cash Flow | -120.00M | -43.00M | 153.00M | -70.00M | -226.00M | -135.00M |
| Financing Cash Flow | -378.00M | -49.00M | -207.00M | -546.00M | -536.00M | 12.00M |
TriNet Group Risk Analysis
TriNet Group disclosed 2 risk factors in its most recent earnings report. TriNet Group reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 1 New Risks
1.
We may incur losses related to Employee Retention Tax Credit claims filed on behalf of our clients. Q2, 2026
TriNet Group Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $43.29B | 24.79 | 45.13% | 3.73% | 16.88% | 6.56% | |
78 Outperform | $110.29B | 25.31 | 70.20% | 2.39% | 6.74% | 9.46% | |
70 Outperform | $821.81M | 24.40 | 15.76% | 0.94% | 5.59% | -33.45% | |
68 Neutral | $3.17B | 18.47 | 188.17% | 1.64% | -2.83% | 26.75% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
58 Neutral | $1.98B | -123.71 | -24.52% | 4.62% | 2.64% | -140.86% | |
58 Neutral | $4.36B | 37.03 | 9.18% | 5.54% | -4.95% | -34.47% |
* Industrials Sector Average
TNET
TriNet Group
65.91
-0.82
-1.23%
ADP
Automatic Data Processing
267.96
-21.24
-7.35%
BBSI
Barrett Business Services
32.55
-14.00
-30.07%
NSP
Insperity
49.63
<0.01
0.01%
PAYX
Paychex
116.93
-11.81
-9.17%
RHI
Robert Half
39.21
6.19
18.75%
TriNet Group Corporate Events
Dividends
TriNet Group Declares Quarterly Cash Dividend to Shareholders
Positive
Jun 17, 2026
On June 17, 2026, TriNet Group, Inc. announced that its board of directors approved a quarterly cash dividend of $0.29 per share on its common stock. The dividend will be paid on July 27, 2026, to shareholders of record as of July 1, 2026, which i...
Executive/Board ChangesShareholder Meetings
TriNet Stockholders Approve Directors, Executive Pay and Auditor
Positive
May 27, 2026
On May 27, 2026, TriNet Group, Inc. held its 2026 Annual Meeting of Stockholders, where investors elected four directors, including Michael J. Angelakis, David C. Hodgson, Jacqueline Kosecoff and Michael Q. Simonds, to serve until the 2029 Annual ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
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.