CBIZ (CBZ) Q4 2024 earnings summary

Executive summary

• Achieved 14% revenue growth in 2024, driven by the Marcum acquisition, which solidified a leading position in middle-market professional services and expanded service offerings.

• Integration of Marcum is progressing well, with strong team retention, early cross-selling successes, and expected to be accretive to adjusted EPS by ~10% in 2025.

• The company offers essential, recurring services with high client retention (~90%) and a diverse client base across 22 major markets.

• Additional strategic and tuck-in acquisitions, including Erickson, Brown & Kloster and CompuData, expanded geographic and service capabilities.

• CBIZ emphasizes operational leverage, strong cash flows, and a proven ability to grow earnings faster than revenue, with a 2019–2023 revenue CAGR of 13.8% and adjusted EPS CAGR of 17.6%.

Financial highlights

• 2024 total revenue grew 14% to $2.8B, with Q4 revenue up 40.5% year-over-year to $460.3M, including $108.9M from Marcum; same-unit revenue up 4.8%.

• 2024 adjusted EPS was $2.67, up 10.8% from $2.41 in 2023, within guidance; GAAP EPS was $0.78, reflecting significant acquisition and integration costs.

• Adjusted EBITDA for 2024 (excluding Marcum) increased approximately 9%-10% year-over-year.

• 2024 recurring revenue represented 77% of total revenue.

• Gross margin for 2024 was 10.1%, down from 14.0% in 2023.

Outlook and guidance

• 2025 revenue guidance: $2.90B–$2.95B, with growth primarily organic as integration is prioritized.

• 2025 adjusted EPS projected at $3.60–$3.65; GAAP EPS expected at $1.97–$2.02.

• Adjusted EBITDA for 2025 forecasted at $450M–$456M.

• Tax rate for 2025 anticipated at ~29%; diluted share count estimated at 64.5–65 million.

• $25M+ in synergy opportunities expected over three years, with most realized in 2026 and beyond.