Announces New $15 Million Stock Repurchase Program

DHI Group, Inc. (DHX) announced a new $15 million stock repurchase program, supplanting the prior $20 million buyback authorization that was recently completed. The new authorization is already effective and is slated to run through February 2023. Assuming the full amount is exhausted at current levels, DHI Group could reduce its share count by approximately 5% and would return approximately 65% of the free cash flow we project for FY ’22 to shareholders. As DHX trades at just 2.2x our revenue estimate for this year, we believe the stock is undervalued and consider the buyback an attractive use of capital. Valuation aside, DHI Group’s results of late should also have investors excited given robust bookings growth, an accelerating growth trajectory and solid margins, yet the response to last week’s beat and raise was rather muted, in our opinion. With favorable labor dynamics likely to persist, we see ample opportunity for DHI Group to continue its recent string of outperformance and would follow the company’s lead in buying shares. Our price target remains $8.00 based on a FY ’22 EV/Sales multiple of approximately 3x.

Our report with model and disclosures is available here.

Disclosure(s):

K. Liu & Company LLC (“the firm”) receives or intends to seek compensation from the companies covered in its research reports. The firm has received compensation from DHI Group, Inc. (DHX) in the past 12 months for “Sponsored Research.”

Sponsored Research produced by the firm is paid for by the subject company in the form of an initial retainer and a recurring monthly fee. The analysis and recommendations in our Sponsored Research reports are derived from the same process and methodologies utilized in all of our research reports whether sponsored or not. The subject company does not review any aspect of our Sponsored Research reports prior to publication.