Kelly Services (KELYA) Stock Forecast & Price Target

Kelly Services Inc. has demonstrated strong financial growth in key segments, with Q4/24 adjusted EBITDA increasing 34% year-over-year to $43.5 million, outperforming both estimates and consensus. The company's Professional & Industrial segment revenue grew 4.4% year-over-year, supported by an effective omni-channel strategy that capitalizes on both mobile and traditional office networks. Additionally, the anticipated expansion of adjusted EBITDA margins to 3.6% in the first half of 2025, bolstered by high-margin outcome-based solutions and the recent MRP acquisition, further underscores a positive outlook for the company.

Kelly Services anticipates flat to slightly declining organic revenue across several segments during the first half of 2025, reflecting an uncertain demand environment. The company reported a modest organic revenue growth of only 0.5% in 2025, which remains below industry expectations, while Q3/24 revenue declined 7.1% year-over-year, primarily due to divestments and weakness in the staffing market. Additionally, downward revisions to the organic growth outlook and adjusted EBITDA margin expectations underscore prevailing financial challenges, particularly in the Science, Education, and Technology (SET) segment, which experienced a significant revenue decline.