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One day I read about some investment opportunities in the staffing services industry segment and while doing some research and comparative analysis I come upon CDI Corporation (NYSE:CDI). A diversified company with a 60-year history of excellence that has recently completed a successful restructuring.

CDI Corporation delivers engineering and technology solutions, recruitment, and staffing services to clients with operations around the globe. Industry segments served include Oil, Gas and Chemicals; Aerospace and Industrial Equipment; High Technology; and the Government.

Recent developments at the beginning of this year provide a glimpse of the successes that have followed the recent restructuring and client services approach; allowing for a picture of the company's diversification of services.

A business model, to me, that is very attractive.

CDI has teamed up with Nucor (NYSE:NUE) and Tenova to develop the world's largest direct reduced iron facility. The company was also awarded a contract to provide facilities standardization specifications for Access Midstream Partners to develop natural gas compressor stations across the natural gas rich areas in Louisiana, Ohio, Oklahoma, Pennsylvania, Texas, West Virginia and Wyoming.

In addition, CDI also has been awarded a new Seaport task order from the U. S. Navy to continue to provide watercraft and marine engineering services for Naval Surface Warfare Center.

CDI was named the HDI outsourcer of the year for service management excellence. CDI was selected from among a global group of companies.

The company's annual report summarizes the 2012 year this way;

We aim to gradually increase our higher margin business in both staffing and solutions, which, over time, will be reflected in gross margins. In 2012, we successfully restructured the company and created a unified sales force dedicated to providing solutions to our clients.

We also reduced operating and administrative expenses, which decreased as a percentage of total revenue to 16.9 percent in 2012 from 18.6 percent in 2011. Our new cost structure not only allowed us to report an operating profit margin of 2.9 percent, it also enhances our ability to bid competitively for new clients and new projects.

We also generated $37 million in operating cash flow in 2012, $9 million more than we generated in

2011, and continued to strengthen our balance sheet with a year-end cash position of $44 million and a new credit facility.

Note the CDI: Revenue Mix by Reporting Segment (six months ended June 30, 2013)

GETS - Global Engineering and Technology Solutions

Revenue $158M - GPM 28.0%

MRI - Management Recruiters International

Revenue $29M - GPM 45.8%

PSS - Professional Services Staffing

Revenue $346M - GPM 12.8%

Below are additional financial ratios and information in relation to a peer group. We can note positive P/E ratios, and Dividend Yield (for those of us that are growth and dividend investors) for CDI versus peers GP Strategies Corp. (NYSE:GPX) and Kforce Inc. (NASDAQ:KFRC).

Valuation

CDI

GPX

KFRC

Price/Earnings

19.70

23.24

24.63

Dividend Yield (%)

3.21

--

--

Profitability

Description

CDIGPXKFRC

Gross Profit Margin (%)

19.38

17.46

32.45

Operating Profit
Margin (%)

2.51

8.34

3.92

Net Profit Margin (%)

1.52

5.46

2.32

Cash Flow Margin (%)

2.54

7.63

-0.26

Cash Flow per Share

$1.40

$1.58

$1.03

Per Share Data

Description

CDIGPXKFRC

Cash as Percent of Total Assets (%) (MRQ)

8.77

5.05

1.05

Cash/Share (MRQ)

$1.20

$0.27

$0.03

Book Value/Share (MRQ)

$14.37

$9.23

$4.79

Tangible Book Value/Share (MRQ)

$10.41

$2.28

$2.73

CDI also has a positive cash and value position to peers as shown with the above per share data.

Taking a look at the industry outlook for human resources and employment staffing services, we would expect that as the U. S. economy continues to recover, the labor market would see an upturn from the most recent three years beginning in 2008-09.

The U. S. economy has added a combined 5.3 million workers in the years 2010 through 2012, and another 1.4 million in 2013.

Human resources and employment services companies should see a continued gain in global markets as well as the recovery continues.

There also appears to be a growth trend toward temporary hiring, which are often provided by staffing services firms.

What about the various risks associated with an organization like CDI? These various risks should also be noted; the CDI business is somewhat dependent on capital spending by clients the industries served and cuts in capital spending and economic downturns may result in loss of revenue and profits.

The CDI revenues may also be subject to cycles in certain industries, and the contracting cycles for renewals. This would also be true for the government contracting part of the business that is subject to cycles and government funding.

Conclusion

There is a lot to like about CDI Corporation, the long history, the place in the global market, and successful client strategies . The P/E ratio of 19.7 and the Dividend Yield of 3.21% would make it a good fit in my portfolio. As a result, CDI now becomes a likely candidate to be added in my portfolio.

Disclosure: Securities prices and yields quoted are current as of October 25, 2013. I have no positions in any stocks mentioned, but may initiate a long position in CDI over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Source: CDI Corp. - A Jewel Discovered For Your Portfolio

Additional disclosure: These are only personal opinions and all readers should do their own research. Readers are accountable for investment decisions and trades. I do not know the circumstances, risk tolerance or investment objectives of the readers. There is no guarantee that any investment mentioned in this article will be profitable or appropriate for readers.