Here's Why You Should Retain NSP Stock in Your Portfolio for Now

Shares of Insperity, Inc. NSP have surged  60.4% over the past three months compared with the industry’s 55.1% return.

NSP has a Growth Score of A. This style score condenses key financial metrics to reflect a fair sense of the quality and sustainability of its growth.

The company’s third-quarter 2026 earnings are expected to increase more than 100% year over year. Earnings for 2026 and 2027 are projected to rise more than 100% and 38.4% year over year, respectively. Revenues are expected to increase 1.4% in 2026 and 4.6% in 2027.

Factors That Bode Well for NSP

Expanding PEO Market: Insperity is benefiting from the rapidly growing global professional employer organization (PEO) market. This growth is driven by the proliferation of small and medium-sized businesses, increased costs related to workers’ compensation insurance coverage, workplace safety programs, employee-related complaints and litigation, and complex regulations governing payroll, payroll tax and employment issues. The company’s expertise as a leader in PEO services drives growth by meeting this growing demand.

Insperity, Inc. Revenue (TTM)

Insperity, Inc. revenue-ttm | Insperity, Inc. Quote

Margin Recovery Actions Should Sustain Momentum: NSP prioritizes margin recovery in the first year of its three-year plan. During the second quarter of 2026, the company’s Adjusted EBITDA rose 13% year over year to $36 million. Reported net income improved to $4 million from a loss of $5 million in the prior-year quarter. Recently, management stated that its recovery plan contributed to positive results, driven by strategic pricing and client retention actions, benefit plan and policy changes, and operating expense management. The company expects the collective impact of these measures to drive a significant profit recovery during 2026.

Consistent Dividends & Buybacks: The company has consistently demonstrated its commitment to rewarding shareholders through dividends and share buybacks. During 2023, 2024 and 2025, the company paid out dividends of $77 million, $89 million and $90 million while repurchasing shares worth $131.5 million, $63 million and $19 million, respectively. During the first six months of 2026, NSP paid $46 million in dividends and repurchased approximately 172,000 shares for $4 million. These policies make the stock more attractive to investors.

Robust Liquidity: Insperity held $700 million in cash and cash equivalents and marketable securities at the end of the second quarter of 2026, against zero current debt. This demonstrates that the company has sufficient liquidity to support growth. Moreover, NSP’s current ratio is at 1.11, almost in line with 1.12 from the preceding quarter. While it may not have surpassed the industry average of 1.31, it exceeds 1, which is a green flag for investors as it signals effective coverage of short-term obligations.

Watch Out for These Risks to NSP Stock

Stiff Rivalry: Insperity operates in a very competitive industry with companies like HireQuest, Kforce and TrueBlue. However, the competition is stiffer in the PEO industry. Competition in the PEO industry persists primarily in terms of the quality of services offered and benefits packaging and pricing. Moreover, PEOs are substantially dependent on climatic conditions and the target markets in which they operate. This puts pressure on the company to maintain cost efficiency and increases the challenge of balancing growth and profitability.

Elevated Debt: NSP’s high debt to fund operational needs is a concern for investors. The company had outstanding borrowings of $420 million under its credit facility during the second quarter of 2026. It signals cash flow pressure, lowering capital flexibility and raising a red flag for risk-sensitive investors.

Insperity has a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stocks to Consider

A couple of better-ranked stocks in the broader Business Services sector are Bright Horizons Family Solutions Inc. BFAM and CBIZ, Inc. CBZ.

Bright Horizons Family Solutions carries a Zacks Rank #2 (Buy) at present. It has a long-term earnings growth expectation of 13.9%.

BFAM delivered a trailing four-quarter earnings surprise of 7.6%, on average.

CBIZ also holds a Zacks Rank of 2 at present. It has a long-term earnings growth expectation of 11.6%.

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This article originally published on Zacks Investment Research (zacks.com).

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