Korn/Ferry International (NYSE: KFY) runs the largest executive recruitment firm in the world, working through more than eighty offices in thirty-nine countries. Executive Search, the firm's core business, focuses on board level, CEO, and other senior executive positions for clients in the consumer, financial, industrial, technology, and life sciences industries. Through the company's Futurestep service, job seekers use the Internet and videotaped job interviews to locate mid-level management positions.

The firm pleased investors last week, when it reported fiscal second quarter (Q2) earnings per share (EPS) of 37 cents and revenues of $206.8 million. Analysts had been looking for 33 cents and $190.1 million. Management also guided Q3 EPS to 34-39 cents, versus a Street consensus of 33 cents. KFY shares popped on the news and then moved into a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the issue with three "strong buys", five "holds" and a "sell". Analysts expect a 15% average annual earnings growth rate, through the next five years. The KFY P/E ratio (15.08), PEG ratio (1.01), Price to Sales ratio (1.25), Price to Book ratio (2.11), Price to Cash Flow ratio (13.94), Price to Free Cash Flow (15.11), Sales Growth rate (25.49%), EPS Growth rate (19.35%) and Return on Assets (8.50%) compare favorably with industry, sector, and S&P 500 averages. Institutional investors hold about 95% of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, it has traded between $15.35 and $27.13. A stop-loss of $16.60 looks good here if one were to invest in it.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.