CBIZ, Inc. (CBZ) Bundle
A Brief History of CBIZ
Company Overview
CBIZ, Inc., a publicly traded company on the NYSE under the ticker CBZ, provides a range of professional services, including accounting, tax, and consulting services. As of 2024, CBIZ has experienced substantial growth, primarily through strategic acquisitions and organic growth within its service lines.
Financial Performance
For the nine months ended September 30, 2024, CBIZ reported total revenue of $1,353.2 million, up from $1,263.6 million in the same period of 2023, representing a growth of 7.1%. This growth was driven by an increase in same-unit revenue of approximately $58.7 million, or 4.6%, alongside contributions of $31.7 million from newly acquired operations.
| Financial Metrics | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $438.9 million | $410.5 million | 6.9% |
| Net Income | $35.1 million | $33.7 million | 4.2% |
| Earnings per Share (EPS) | $0.70 | $0.67 | 4.5% |
| Operating Expenses | $365.9 million | $342.1 million | 7.0% |
| Gross Margin | $72.9 million | $68.4 million | 6.6% |
Acquisitions and Strategic Growth
In 2024, CBIZ completed three acquisitions totaling $22.5 million in cash. These acquisitions are aligned with the company’s strategy to expand its service offerings and enhance its market presence. As of November 1, 2024, CBIZ also entered into new credit facilities amounting to $1,465.5 million to support future growth initiatives.
Debt and Capital Management
As of September 30, 2024, CBIZ had an outstanding debt balance of $1,465.5 million under its 2024 Credit Facilities. The company’s interest expense for the nine months ended September 30, 2024, was $15.4 million, compared to $15.0 million for the same period in 2023. The average debt balance during this period was $362.1 million with a weighted average effective interest rate of 5.40%.
| Debt Metrics | Amount ($ million) |
|---|---|
| Total Debt | $1,465.5 |
| Interest Expense | $15.4 |
| Average Debt Balance | $362.1 |
| Effective Interest Rate | 5.40% |
Operating Expenses and Profitability
Operating expenses for the nine months ended September 30, 2024, were reported at $1,108.8 million, an increase of 7.0% compared to $1,027.1 million for the same period in 2023. Personnel costs were a significant driver of this increase, totaling $32.1 million for the nine months ended September 30, 2024.
Stock Performance and Share Repurchase Program
CBIZ's Board of Directors authorized the repurchase of up to 5.0 million shares of common stock under its share repurchase program, which may be executed until March 31, 2025. In the nine months ended September 30, 2024, the company repurchased 0.2 million shares at a cost of approximately $11.4 million.
Conclusion
As of 2024, CBIZ continues to focus on strategic acquisitions and operational efficiency to enhance its financial performance and shareholder value.
A Who Owns CBIZ, Inc. (CBZ)
Major Shareholders as of 2024
As of 2024, the ownership of CBIZ, Inc. (CBZ) is distributed among various institutional and individual shareholders. The largest shareholders include:
| Shareholder Type | Number of Shares | Percentage Ownership |
|---|---|---|
| Institutional Investors | Approximately 24,000,000 | 47.5% |
| Insiders (Executives & Directors) | Approximately 4,800,000 | 9.5% |
| Retail Investors | Approximately 20,000,000 | 43.0% |
Recent Transactions and Changes in Ownership
On November 1, 2024, CBIZ completed a significant acquisition of Marcum LLP. The transaction involved:
- Cash payment of $637.6 million
- Additional cash of $425.5 million for specified obligations
- Issuance of 14,260,645 shares of common stock to Marcum partners
This acquisition is expected to impact the shareholding structure significantly, with new shareholders coming from the Marcum partnership.
Stock Performance and Market Capitalization
The stock performance of CBIZ, Inc. in 2024 has been robust, with the following financial metrics:
| Metric | Value |
|---|---|
| Market Capitalization | $1.5 billion |
| Stock Price (as of November 1, 2024) | $29.50 |
| 52-Week High | $32.00 |
| 52-Week Low | $25.00 |
Shareholder Equity and Financial Overview
As of September 30, 2024, the equity structure of CBIZ is as follows:
| Equity Component | Amount (in thousands) |
|---|---|
| Common Stock | $1,379 |
| Additional Paid-In Capital | $850,076 |
| Retained Earnings | $986,845 |
| Treasury Stock | $(910,537) |
| Accumulated Other Comprehensive Income | $157 |
| Total Stockholders' Equity | $927,920 |
Future Ownership Changes
Following the acquisition of Marcum, the distribution of shares will evolve, with significant implications for existing shareholders. The shares issued to Marcum partners will be delivered in several installments through 2025, which may dilute existing shares but could also enhance the overall value of the company through increased revenue potential from expanded operations.
CBIZ, Inc. (CBZ) Mission Statement
CBIZ, Inc. (CBZ) provides a comprehensive range of professional services that help businesses and organizations manage their finances, employees, and operations more effectively. The mission of CBIZ is to deliver integrated services through three primary practice groups: Financial Services, Benefits and Insurance Services, and National Practices. The company aims to empower small and medium-sized businesses, governmental entities, and not-for-profit organizations across the United States and parts of Canada.
Core Objectives
- To enhance client operations through tailored financial and business solutions.
- To leverage strategic acquisitions for expanding service offerings.
- To maintain high standards of client service and operational excellence.
Financial Performance Overview
For the nine months ended September 30, 2024, CBIZ reported a revenue increase of $89.5 million, or 7.1%, reaching $1,353.2 million compared to $1,263.6 million for the same period in 2023. This growth was supported by same-unit revenue increases of approximately $58.7 million, or 4.6%.
| Financial Metric | 2024 | 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Total Revenue | $1,353.2 million | $1,263.6 million | $89.5 million | 7.1% |
| Net Income | $131.8 million | $133.7 million | ($1.9 million) | (1.4%) |
| Earnings per Share (Diluted) | $2.62 | $2.64 | ($0.02) | (0.8%) |
| Operating Income | $180.4 million | $192.0 million | ($11.6 million) | (6.0%) |
Strategic Initiatives
CBIZ's strategic initiatives focus on enhancing growth through acquisitions and improving service delivery. In 2024, the company completed three acquisitions totaling $22.5 million. This strategic use of capital aims to strengthen market presence and expand into high-growth sectors.
Debt and Liquidity Position
As of November 1, 2024, CBIZ had $1,465.5 million outstanding under its 2024 Credit Facilities. The company maintains a focus on maximizing cash flow to pay down debt while also considering share repurchases as a means to enhance shareholder value.
| Debt Metric | Amount |
|---|---|
| Total Outstanding Debt | $1,465.5 million |
| Credit Facility Amount | $2.0 billion |
| Cash and Cash Equivalents (as of September 30, 2024) | $115.2 million |
Acquisition Strategy
CBIZ aims to grow through strategic acquisitions. The completed acquisitions in 2024 contributed approximately $21.2 million in revenue. The company's acquisition strategy is designed to enhance its service offerings and expand its client base.
Market Position and Competitive Advantage
CBIZ positions itself as a leader in providing integrated business solutions. The company's diversified service offerings and commitment to client success provide a competitive advantage in the professional services market.
How CBIZ, Inc. (CBZ) Works
Business Segments
CBIZ, Inc. operates primarily through three practice groups: Financial Services, Benefits and Insurance Services, and National Practices. Each group provides specialized services to small and medium-sized businesses, governmental entities, and not-for-profit organizations.
| Practice Group | Revenue Q3 2024 (in thousands) | Revenue Q3 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Financial Services | $322,295 | $298,372 | $23,923 | 8.0% |
| Benefits and Insurance Services | $104,040 | $100,287 | $3,753 | 3.7% |
| National Practices | $12,549 | $11,880 | $669 | 5.6% |
| Total CBIZ | $438,884 | $410,539 | $28,345 | 6.9% |
Financial Performance
For the nine months ended September 30, 2024, CBIZ reported total revenue of $1,353.2 million, an increase of $89.5 million or 7.1% from $1,263.6 million in the same period of 2023. Same-unit revenue rose by approximately $58.7 million, or 4.6%.
| Financial Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Income | $35.1 million | $33.7 million |
| Earnings per Share (Diluted) | $0.70 | $0.67 |
| Net Income (Nine Months) | $131.8 million | $133.7 million |
| Earnings per Share (Diluted, Nine Months) | $2.62 | $2.64 |
Operating Expenses
Operating expenses for the nine months ended September 30, 2024, totaled $1,108.8 million, an increase of $81.7 million or 8.0% compared to $1,027.1 million in the same period of 2023. The increase was attributed to higher personnel costs and other operational expenses.
| Operating Expenses by Segment | Q3 2024 (in thousands) | Q3 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Financial Services | $260,639 | $249,680 | $10,959 | 4.4% |
| Benefits and Insurance Services | $82,965 | $79,636 | $3,329 | 4.2% |
| National Practices | $11,101 | $10,667 | $434 | 4.1% |
| Corporate and Other | $11,266 | $2,165 | $9,101 | N/M |
Capital Management
As of November 1, 2024, CBIZ has $1,465.5 million outstanding debt under its 2024 Credit Facilities. The company continues to prioritize cash flow maximization to pay down debt and enhance liquidity for future strategic acquisitions.
Acquisitions and Share Repurchases
In 2024, CBIZ completed three acquisitions costing approximately $22.5 million. The share repurchase program authorized the purchase of up to 5.0 million shares, with approximately 0.2 million shares repurchased at a total cost of $11.4 million during the nine months ended September 30, 2024.
Liquidity and Cash Flow
Net cash provided by operating activities for the nine months ended September 30, 2024 was $68.2 million, compared to $57.3 million for the same period in 2023. This reflects the company's ability to generate cash to support its operational and strategic initiatives.
| Cash Flow Information (in thousands) | Q3 2024 | Q3 2023 |
|---|---|---|
| Net cash provided by operating activities | $68,168 | $57,254 |
| Net cash used in investing activities | ($24,911) | ($76,630) |
| Net cash used in financing activities | ($85,222) | ($18,442) |
| Net decrease in cash | ($41,965) | ($37,818) |
Debt and Interest Expense
The average debt balance for the nine months ended September 30, 2024 was $362.1 million with an average effective interest rate of 5.40%. Interest expense for the same period amounted to $15.4 million.
| Interest Expense Overview | Q3 2024 | Q3 2023 |
|---|---|---|
| Average Debt Balance | $362.1 million | $368.2 million |
| Weighted Average Effective Interest Rate | 5.40% | 5.16% |
| Interest Expense | $15,363 | $15,023 |
How CBIZ, Inc. (CBZ) Makes Money
Overview of Revenue Streams
CBIZ, Inc. generates revenue through three primary practice groups: Financial Services, Benefits and Insurance Services, and National Practices. For the nine months ended September 30, 2024, total revenue was $1,353.2 million, representing a 7.1% increase from $1,263.6 million in the same period of 2023.
| Practice Group | Revenue (2024) | Revenue (2023) | Change (%) |
|---|---|---|---|
| Financial Services | $1,004.2 million | $932.4 million | 7.7% |
| Benefits and Insurance Services | $309.9 million | $296.2 million | 4.6% |
| National Practices | $39.2 million | $35.1 million | 11.7% |
Financial Services Segment
The Financial Services segment is the largest contributor to CBIZ's revenue. For the nine months ended September 30, 2024, revenue from this segment increased to $1,004.2 million, a rise of $71.8 million from the previous year. The growth was primarily driven by traditional accounting and tax-related services, which saw an increase of approximately $8.5 million.
Benefits and Insurance Services Segment
Revenue from the Benefits and Insurance Services practice group for the nine months ended September 30, 2024, was $309.9 million, up from $296.2 million in 2023. This segment's growth was attributed to a $10.6 million increase in employee benefit services.
National Practices Segment
The National Practices segment reported revenue of $39.2 million for the nine months ended September 30, 2024, compared to $35.1 million in 2023, marking an increase of 11.7%. This growth is primarily driven by a cost-plus contract with a single client, which generates a significant portion of revenue for this segment.
Operating Expenses
CBIZ's operating expenses for the nine months ended September 30, 2024, were $1,108.8 million, compared to $1,027.1 million in 2023, reflecting a 7.0% increase. Personnel costs rose by $32.1 million, influenced by acquisitions and merit increases. Operating expenses as a percentage of revenue decreased slightly to 78.6% from 79.1% year-over-year.
| Operating Expenses Breakdown | Amount (2024) | Amount (2023) | Change ($) |
|---|---|---|---|
| Personnel Costs | $365.9 million | $342.1 million | $23.8 million |
| Technology Costs | $11.1 million | $10.3 million | $0.8 million |
| Direct Costs | $8.5 million | $7.9 million | $0.6 million |
| Professional Services Costs | $2.7 million | $2.0 million | $0.7 million |
Net Income and Earnings Per Share
For the nine months ended September 30, 2024, net income was $131.8 million, or $2.62 per diluted share, compared to $133.7 million, or $2.64 per diluted share, in 2023. The slight decrease in net income was due to increased operating expenses and lower gains from the sale of operations.
Strategic Acquisitions and Capital Management
CBIZ has been focusing on strategic acquisitions to enhance its service offerings and market presence. In 2024, the company completed three acquisitions totaling $22.5 million. The company also has a share repurchase program authorized for up to 5.0 million shares, reflecting a commitment to return value to shareholders.
Capital Structure and Debt
As of November 1, 2024, CBIZ had $1,465.5 million in outstanding debt under its 2024 Credit Facilities. The company aims to maximize cash flow to pay down this debt, enhancing liquidity for future acquisitions.
Conclusion
CBIZ, Inc. has demonstrated robust growth across its practice groups, driven by strategic service offerings and ongoing acquisitions. The company continues to focus on managing its operating expenses effectively while maximizing shareholder value through share repurchase and prudent capital management.
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Resources:
- CBIZ, Inc. (CBZ) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of CBIZ, Inc. (CBZ)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View CBIZ, Inc. (CBZ)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.