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Korn Ferry (KFY) Valuation Check After Recent Underperformance vs Longer-Term Shareholder Returns

Simply Wall St · 1d ago

Korn Ferry (KFY) shares have lagged the broader market over the past 3 months, even as the company continues to post steady revenue and earnings growth. This invites a closer look at its valuation.

See our latest analysis for Korn Ferry.

At around $66.07 per share, Korn Ferry’s 1 year total shareholder return of negative 5.25 percent contrasts with a robust 3 year total shareholder return of 37.61 percent. This suggests that longer term momentum remains intact even as near term sentiment cools.

If Korn Ferry’s recent drift has you reassessing your options, it could be worth exploring fast growing stocks with high insider ownership that might offer stronger momentum or fresher growth stories.

With earnings still growing and shares trading at a sizable discount to analyst targets and intrinsic value estimates, is Korn Ferry now quietly undervalued, or is the market already pricing in its next leg of growth?

Most Popular Narrative: 18.4% Undervalued

The most followed narrative values Korn Ferry at $81 per share compared to the last close of $66.07, framing a meaningful valuation gap that hinges on improving profitability and steady growth.

The company's strategy of diversifying and expanding into larger addressable markets with a wide range of organizational and talent solutions is expected to enhance revenue predictability and sustainability, potentially improving net margins. Korn Ferry is experiencing growth in new business, particularly in the Americas and EMEA regions, along with an increase in cross solution referrals, suggesting potential for revenue growth and a positive impact on earnings.

Read the complete narrative.

Want to see why modest growth assumptions still unlock a higher valuation? The narrative leans on rising margins, richer mix, and a future earnings multiple that may surprise you.

Result: Fair Value of $81 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, stubborn macro headwinds or slower conversion of large engagements into revenue could quickly challenge the margin recovery and valuation upside that is implied here.

Find out about the key risks to this Korn Ferry narrative.

Build Your Own Korn Ferry Narrative

If this view does not align with yours, or you would rather dig into the numbers yourself, you can build a custom narrative in minutes: Do it your way.

A great starting point for your Korn Ferry research is our analysis highlighting 6 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.