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RWBairds, Mark Marcon Raising Price Target on Robert Half.

RWBairds, Mark Marcon Raising Price Target on Robert Half.

Increasing our price target to $33 reflecting recent improvement in
trends. Temp labor market data and competitor results suggest that
temp staffing improved in January and February. More importantly,
appears long-term secular trend toward usage of flexible staffing may
be improving. Reflecting increased confidence in estimates and
positive longer-term outlook, we are increasing our price target to
reflect a multiple closer to midpoint of the historical range at this
point in the cycle.

* Temp help employment data improving.

* Since RHI reported Q4 results in January, several other
staffing firms have reported improving January/February trends
(most recently Adecco, on March 3).

* We recently hosted 21 HCS firms at Baird's Business Solutions
Conference -- virtually every staffing company noted that it
is seeing signs that the economy is improving.

* Temp help employment has now increased by 16.5% over the last
five months (on a seasonally adjusted basis) according to the
BLS, the largest increase in the history of the data.

* ADP data suggests that employment trends at small companies
are improving.

* Early signs of a positive secular trend toward increasing usage of
flexible staffing are emerging. Trend reflects increasing desire
for flexibility among employers and high quality of available temp
professionals.

* Our estimates are unchanged at this time however, we have
increased confidence that RHI can achieve estimates.

* Raising our price target to $33.

* Reflects 33x our '11 EPS estimate and 17.5x prior peak EPS of
$1.89.

*

Historically, RHI has traded in a wide range (roughly 25-50X
NTM EPS) following the first full-year of a labor market
expansion. We are raising our price target closer to the
midpoint of the historical range at this point in the cycle
given the recent improvement in data.

*

Believe it is probable that RHI will surpass prior EPS of
$1.89 within the next three to five years assuming continued
GDP growth.

*

Recommend disciplined accumulation to long-term investors.

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