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1. Company Snapshot

1.a. Company Description

GEE Group, Inc.provides permanent and temporary professional and industrial staffing and placement services in the United States.The company operates through two segments, Industrial Staffing Services and Professional Staffing Services.


It offers placement of information technology, accounting, finance, office, engineering, and medical professionals for direct hire and contract staffing services; and temporary staffing services for light industrial clients.The company also provides medical scribes, who offer electronic medical record services for emergency departments, specialty physician practices, and clinics.It offers professional and commercial staffing services under the names of Access Data Consulting, Agile Resources, Ashley Ellis, GEE Group, Omni One, Paladin Consulting, and Triad; medical staffing services under the Scribe Solutions brand; and contract and direct hire professional staffing services under the Accounting Now, Staffing Now, SNI Banking, SNI Certes, SNI Energy, SNI Financial, and SNI Technology brands.


The company was formerly known as General Employment Enterprises, Inc.and changed its name to GEE Group, Inc.in July 2016.


GEE Group, Inc.was founded in 1893 and is based in Jacksonville, Florida.

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1.b. Last Insights on JOB

GEE Group's recent performance was driven by the company's ability to adapt to changing market conditions. The announcement of its fiscal 2026 first quarter results, which showed a strong start to the year, is a positive development. Additionally, the company's receipt of an Indication of Interest from Star Equity Holdings, a potential acquirer, suggests that GEE Group's assets are attractive to other companies. Furthermore, the company's decision to hold investor conference calls to discuss its quarterly results demonstrates its commitment to transparency and communication with stakeholders.

1.c. Company Highlights

2. GEE Group's Challenging Fiscal 2025: A Path to Restoration

GEE Group reported a challenging fiscal 2025 with consolidated revenues of $96.5 million and $23.5 million for the full-year and fourth-quarter, respectively, down 10% from the prior year. The Professional segment's contract staffing services revenues were $84.7 million and $20.4 million, respectively, down 11% from the prior year. Gross profits and gross margins were $33.4 million and 34.6% for the fiscal year and $8.4 million and 35.8% for the quarter. The company reported a loss from continuing operations of $34.7 million or $0.32 per diluted share for the fiscal year and $613,000 or $0.01 per diluted share for the quarter. The actual EPS for the quarter came out at -$0.01 relative to estimates at $0.03.

Publication Date: Dec -23

📋 Highlights
  • Revenue Decline:: FY2025 and Q4 revenues fell 10% ($96.5M) and 11% ($23.5M) YoY, driven by hiring challenges.
  • Losses and Margins:: FY2025 reported a $34.7M net loss ($0.32/share) and $1.2M non-GAAP EBITDA loss; Q4 showed a $613K loss ($0.01/share) and $306K EBITDA loss.
  • Strategic Adjustments:: Reduced SG&A by $3.8M annually and acquired Hornet Staffing in March 2025 to revive profitability, targeting FY2026 turnaround.
  • Liquidity:: $21.4M cash, $4.8M undrawn ABL facility, and $24M net working capital maintain strong short-term financial stability.
  • Ownership Alignment:: Senior management owns 25% of shares, with $1.3M forfeited in unvested stock options due to performance, signaling stakeholder commitment.

Strategic Adjustments and Cost Management

The company is taking actions to adjust and enhance its strategic focus, growth plans, and financial performance. It completed the acquisition of Hornet Staffing in March 2025 and reduced SG&A expenses by an estimated annual amount of $3.8 million. Management believes that AI and automation will play an important role in restoring profitability, targeting to become profitable again in fiscal 2026. As the senior management team collectively owns around 5-6 million shares, with over 25% of the company's outstanding stock, they have a vested interest in the company's performance.

Liquidity Position and Capital Allocation

The company's liquidity position remains strong, with $21.4 million in cash, an undrawn ABL credit facility with availability of $4.8 million, and net working capital of $24.0 million. The company evaluates share buyback options at every Board meeting but prioritizes restoring profitability. They consider buying back shares as an option to grow per-share value but focus on investing in growth opportunities through acquisitions, particularly in AI, cybersecurity, and high-end IT consulting.

Valuation and Growth Prospects

Analysts estimate next year's revenue growth at 18.6%. The current valuation metrics show a P/S Ratio of 0.21 and an EV/EBITDA of -2.84. With a strong liquidity position and a focus on restoring profitability, the company's prospects for growth are promising. The management's alignment with shareholders, as evident from their significant shareholding and forfeited stock options worth $1.3 million due to performance issues, indicates a strong commitment to creating shareholder value.

Operational Efficiency and Future Plans

The company is moving towards a hybrid work model, leveraging technology to reduce their brick-and-mortar footprint, having closed or consolidated about half a dozen offices over the past 2-3 years. They leverage offshore teams in India for sales and recruiting and plan to increase utilization and expand into nearshore opportunities in Latin America, aiming to achieve positive cash flow and free cash flow.

3. NewsRoom

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GEE Group Inc. (JOB) Q1 2026 Earnings Call Transcript

Feb -13

Source: seekingalpha.com

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GEE Group Announces Results for the Fiscal 2026 First Quarter Ended December 31, 2025

Feb -12

Source: accessnewswire.com

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GEE Group to Hold Investor Conference Call to Discuss 2026 Fiscal First Quarter Results

Feb -11

Source: accessnewswire.com

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GEE Group Addresses Star Equity's Public Commentary Regarding Indication of Interest

Jan -22

Source: accessnewswire.com

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GEE Group Inc. (JOB) Q4 2025 Earnings Call Transcript

Dec -18

Source: seekingalpha.com

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GEE Group Announces Results for the Fiscal Fourth Quarter and Full Year Ended September 30, 2025

Dec -17

Source: accessnewswire.com

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GEE Group to Hold Investor Conference Call to Discuss 2025 Fiscal Year and Fourth Quarter Results

Dec -15

Source: accessnewswire.com

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GEE Group Inc. (JOB) 2025 Annual Meeting Of Shareholders Call (Transcript)

Sep -04

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.00%)

6. Segments

Professional Staffing Services

Expected Growth: 2.0%

GEE Group's Professional Staffing Services growth is driven by increasing demand for skilled labor, particularly in IT, healthcare, and finance. The rise of the gig economy and remote work also fuels growth. Additionally, the company's strategic expansion into new markets, investments in digital platforms, and strong client relationships contribute to its 2.0% growth.

Industrial Staffing Services

Expected Growth: 2.0%

GEE Group's Industrial Staffing Services segment growth is driven by increasing demand for skilled labor in manufacturing and logistics, coupled with a tight labor market. Additionally, the company's strategic expansion into new markets and investments in digital recruitment platforms have enhanced its ability to attract and place candidates, contributing to the 2.0% growth rate.

7. Detailed Products

Contract Staffing

GEE Group provides temporary staffing solutions to clients across various industries, offering skilled professionals on a project-by-project basis.

Direct Hire

GEE Group offers direct hire services, providing clients with permanent employees who can fill critical positions within their organizations.

Executive Search

GEE Group's executive search services focus on identifying and recruiting top-level talent for senior-level positions.

Temporary-to-Direct

GEE Group's temporary-to-direct services allow clients to evaluate temporary employees before converting them to permanent staff.

Vendor Management System (VMS)

GEE Group's VMS provides clients with a centralized platform to manage their contingent workforce, including temporary staff, contractors, and freelancers.

Recruitment Process Outsourcing (RPO)

GEE Group's RPO services provide clients with a comprehensive recruitment solution, managing the entire hiring process from job posting to onboarding.

8. GEE Group, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for GEE Group, Inc. is moderate due to the presence of alternative staffing services and the ease of switching costs.

Bargaining Power Of Customers

The bargaining power of customers is high due to the concentration of clients in the industry and their ability to negotiate prices.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the availability of multiple suppliers and the lack of differentiation in their products.

Threat Of New Entrants

The threat of new entrants is moderate due to the moderate barriers to entry and the availability of resources.

Intensity Of Rivalry

The intensity of rivalry is high due to the high competition in the industry and the presence of multiple players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 3.48%
Debt Cost 3.95%
Equity Weight 96.52%
Equity Cost 6.67%
WACC 6.58%
Leverage 3.61%

11. Quality Control: GEE Group, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

0.24$

Current Price

0.24$

Potential

-0.00%

Expected Cash-Flows