Recent Data Portends Improving Demand Environment for Dice
In a press release yesterday, DHI Group (DHX) highlighted CompTIA’s analysis of the U.S. Bureau of Labor Statistics (BLS) latest employment data, which noted that employers added 191,000 new technology job postings in March. The number of new job postings increased by 8,000 from February and reached the highest level since August 2023. In addition, Dice’s own analysis of Q1 ’24 data from Lightcast revealed a 16% sequential increase in job postings for both tech positions and tech recruiters. The uptick in tech job postings was attributable to a 23% Q/Q increase in postings from staffing companies, which we would expect to lead the way out of a downturn, and a 15% Q/Q increase in postings from non-staffing companies. Taken together, these recent data points suggest the demand environment for Dice should improve moving forward as employers look to fill open technology roles. Also worth noting, ManpowerGroup’s (MAN) Employment Outlook Survey for Q2 ’24 shows the strongest Net Employment Outlook (NEO), defined as the percentage of employers planning to hire less the percentage anticipating staffing reductions, in North America at +31% with the IT industry being the strongest contributor in the region with a NEO of +51%.
Our estimates for Q1 and FY ’24 reflect steady sequential improvement in Dice bookings growth, culminating in a return to positive growth exiting the year. Considering the aforementioned data points, we remain comfortable with our current assumptions for the year and are cautiously optimistic that Dice growth could inflect sooner than we anticipate. That said, we maintain our estimates and price target of $7.00, which represents an unchanged FY ’24 EV/Sales multiple of 2.5x.
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.”
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