Should You Buy or Sell Barrett Business Services (BBSI) After Q1 Earnings?

Barrett Business Services (NASDAQ:BBSI) provides management solutions for small and mid-sized businesses. Analysts expect a 7.7% revenue growth over the next 12 months, which is commendable. The company's five-year average ROIC was 57.3%, showcasing its management team's ability to invest in profitable ventures. However, the breakeven free cash flow over the last five years limits its potential for shareholder returns. The current stock price is $46.08, with a forward P/E of 20.4.

Barrett Business Services, Inc. (NASDAQ: BBSI) has announced a conference call to discuss its second-quarter financial results, scheduled for Wednesday, August 6, 2025, at 5:00 p.m. Eastern time [1]. The company's CEO, Gary Kramer, and CFO, Anthony Harris, will lead the call, which will include a question and answer session. The conference call will be available for replay until September 6, 2025.

Analysts expect BBSI to report a 7.7% revenue growth over the next 12 months, reflecting the company's strong market position and effective management strategies [2]. Over the past five years, BBSI's average return on invested capital (ROIC) has been 57.3%, demonstrating the management team's ability to invest in profitable ventures. However, the company's breakeven free cash flow over the last five years has limited its potential for shareholder returns.

The current stock price of BBSI is $46.08, with a forward price-to-earnings (P/E) ratio of 20.4. Despite the recent expansion into the Dallas market, investors should remain cautious about the potential impact of ongoing margin pressure from softness in workers' compensation pricing and regional billings disparities [2].

References:
[1] https://www.nasdaq.com/articles/barrett-business-services-inc-announces-conference-call-discuss-q2-financial-results
[2] https://simplywall.st/stocks/us/commercial-services/nasdaq-bbsi/barrett-business-services/news/will-bbsis-dallas-expansion-reveal-the-true-strength-of-its