Breaking Down CBIZ, Inc. (CBZ) Financial Health: Key Insights for Investors

You're looking at CBIZ, Inc. (CBZ) and seeing a mixed picture after their late October earnings, and honestly, that's the market's current dilemma. The headline is a strong bottom-line beat: Q3 2025 Adjusted Earnings Per Share (EPS) came in at $1.01, comfortably topping the consensus estimate of $0.94, which points to solid margin management and synergy realization from the massive Marcum acquisition. But here's the catch: revenue for the quarter, while up a massive 58.1% year-over-year to $693.8 million, still fell short of Wall Street's $709.2 million expectation, a classic revenue miss despite huge growth. The company's full-year 2025 guidance remains firm, projecting Adjusted EPS at the midpoint of $3.63 and revenue around $2.88 billion, so the core business is defintely on track, but the slight revenue shortfall and the ongoing integration costs are the near-term risks to watch. We need to break down whether that revenue miss is a structural problem in their project-based advisory work or just a minor blip in a massive integration story.

Revenue Analysis

If you're looking at CBIZ, Inc. (CBZ), the headline is simple: the revenue picture for 2025 is one of massive, transformative growth, driven almost entirely by a strategic acquisition. The company is projecting full-year 2025 total revenue to land between $2.8 billion and $2.95 billion, which is a significant jump from the previous year.

To be fair, this isn't just organic growth; it's a structural shift. The year-to-date revenue through September 30, 2025, hit $2.2 billion, representing a huge 63.7% increase over the same period in 2024. This kind of jump defintely changes the risk-reward calculation for investors.

Understanding CBIZ, Inc. (CBZ)'s Revenue Streams

CBIZ, Inc. is a professional services advisor, so its revenue flows primarily from three distinct practice groups: Financial Services, Benefits and Insurance Services, and National Practices. The key takeaway for 2025 is that the Financial Services segment has become the undisputed heavyweight champion, largely due to the integration of the Marcum acquisition.

Here's the quick math on the segment contribution, based on the pro forma breakdown following that major deal:

• Financial Services: Accounts for approximately 84% of total revenue.
• Benefits and Insurance Services: Contributes about 14% of total revenue.
• National Practices: Represents the remaining 2% of total revenue.

The Financial Services segment, which covers core accounting, tax, and advisory services, saw revenue surge by approximately 92% in Q1 2025 alone. This is where the action is, but it also concentrates your risk.

Growth Drivers and Near-Term Risks

The year-over-year growth rate is staggering. For the third quarter of 2025, total revenue reached $693.8 million, marking a 58.1% increase compared to Q3 2024. The Marcum acquisition is the clear catalyst here, expanding CBIZ, Inc.'s client base and strengthening its presence in key U.S. markets, like New York, where it's now a major accounting service provider outside the Big 4.

Still, you need to look closer at the mix. A core strength is the high proportion of essential, recurring services-around 72% to 77% of revenue-which provides stability and predictability. This is a massive buffer.

However, the smaller, non-recurring, and more market-sensitive services, which make up about 23% of revenue, have faced headwinds. Management noted in Q1 2025 that diminished SPAC activity and softer capital markets were impacting these discretionary service lines. This is where the economic climate bites, and it's why the National Practices segment, which includes technology and healthcare consulting, saw a decline of 14.2% in Q1 2025.

For a deeper dive into the valuation and strategic frameworks, you should read the full analysis in Breaking Down CBIZ, Inc. (CBZ) Financial Health: Key Insights for Investors.

Profitability Metrics

You need to know if CBIZ, Inc. (CBZ) is turning its massive revenue growth into sustainable bottom-line profit, and the short answer is yes, but with a clear distinction between core and non-recurring services. CBIZ's profitability is currently strong, largely driven by the Marcum acquisition, with a trailing twelve-month (TTM) net margin around 3.89% as of late 2025, which is a solid result given the integration costs and a challenging project-based market.

For a seasoned investor, the key is separating the adjusted figures from the GAAP (Generally Accepted Accounting Principles) numbers, especially during a major integration like the one with Marcum. CBIZ's management is confident in its operational model, projecting full-year 2025 adjusted earnings per share (EPS) between $3.60 and $3.65, which is a significant jump and a better indicator of core business strength.

Gross, Operating, and Net Profit Margins (2025)

Looking at the most recent available data, the margins show a business with high personnel costs-typical for professional services-but excellent control over overhead, which is what operating margin tells you. The gross profit margin (LTM) is sitting at about 14.5%, reflecting the direct cost of delivering services. The TTM operating margin is currently at 6.45%, and the TTM net margin is 3.89%. Here's the quick math on the key profitability ratios:

What this estimate hides is the impact of non-cash charges like amortization of intangible assets and the one-time integration expenses from the Marcum deal, which drag down the GAAP net income. CBIZ is forecasting a GAAP diluted EPS of only $1.97 to $2.02 for the full year 2025, which is defintely lower than the adjusted figure, but it's the realistic accounting picture.

Profitability Trends and Operational Efficiency

The trend is one of significant growth, but also margin pressure in certain areas. CBIZ's Q2 2025 revenue surged 62.7% year-over-year to $683.5 million, with net income more than doubling to $41.9 million. This growth is almost entirely due to the strategic Marcum acquisition, which provides immense operating scale. The company is effectively managing variable costs to mitigate top-line pressures, especially as its non-recurring service lines (like project-based advisory work) remain soft due to economic uncertainty.

The operational efficiency story is centered on two points:

• Recurring Revenue Stability: About 77% of CBIZ's services are essential and recurring, providing a stable, high-margin base even when discretionary spending slows.
• Cost Management: Management has maintained its full-year 2025 Adjusted EBITDA guidance between $450 million and $456 million, despite widening the revenue range. This signals a strong belief in their ability to control costs and realize integration synergies.

Industry Comparison: A Relative View

When you compare CBIZ, Inc.'s margins to its peers in the professional services industry, you see a mixed picture. CBIZ's gross margin of 14.5% is lower than some competitors like Leidos Holdings Inc. at 17.6% or Korn Ferry at 24.8%. This suggests CBIZ's service mix or compensation structure has a higher direct cost component.

However, the operating margin is where efficiency shines through, as CBIZ has a higher proportion of recurring revenue than some project-based firms. For instance, while CBIZ's TTM operating margin is 6.45%, a tax services peer like H&R Block has a much higher operating margin of 21.11%, but a pure-play research company like Forrester Research is currently sitting at a negative -19.73%. CBIZ's middle-of-the-road margin reflects its diversified offerings-accounting, benefits, and insurance-which you can read more about in their Mission Statement, Vision, & Core Values of CBIZ, Inc. (CBZ).

Debt vs. Equity Structure

You're looking at CBIZ, Inc. (CBZ)'s balance sheet to understand its financing strategy, and the quick takeaway is this: the company is currently using a balanced mix of debt and equity to fuel its growth, especially following its largest-ever acquisition. CBIZ is not overly reliant on shareholder capital, but its leverage has increased to secure a major strategic move.

As of the third quarter of 2025, CBIZ, Inc. (CBZ) maintains a manageable debt structure, though it has grown significantly. The company's short-term debt and capital lease obligations stood at $66 million, while long-term debt and capital lease obligations were substantially higher at $1,503 million. This means the vast majority of its debt, about 96%, is long-term, giving the company predictable repayment schedules and less pressure from near-term liquidity demands.

Here's the quick math on their leverage, which is the Debt-to-Equity (D/E) ratio: CBIZ, Inc.'s D/E ratio is approximately 0.841 (or 84.1%). This is a healthy number for a company that is actively growing via acquisition, and it maps very closely to the industry average for 'Research & Consulting Services,' which is around 0.8356. A ratio below 1.0 means the company is financing its assets with more equity than debt, which is generally a sign of financial stability.

• Short-Term Debt (Sep 2025): $66 million
• Long-Term Debt (Sep 2025): $1,503 million
• Debt-to-Equity Ratio: 0.841

The major shift in this structure came from the financing of the Marcum LLP acquisition, which closed in November 2024. To fund this, CBIZ, Inc. (CBZ) entered into a new $2.0 billion credit facility. This facility consists of a $1.4 billion term loan and a $600.0 million revolving credit facility. This new structure is a clear signal that the company is comfortable using debt financing to execute large, strategic growth initiatives, knowing that the acquired assets and expected synergies should cover the interest payments.

What this estimate hides is the interest rate risk on that large term loan, defintely something to watch in a higher-rate environment. The company's strategy is a classic capital allocation balancing act: using lower-cost debt (compared to issuing potentially dilutive equity) to acquire a major competitor, then relying on the combined entity's cash flow to service that debt. You can dive deeper into the market's reaction to this strategy in Exploring CBIZ, Inc. (CBZ) Investor Profile: Who's Buying and Why?

The choice to fund this growth primarily through a new credit facility, rather than a large equity issuance, shows management's confidence in their cash flow generation. They are prioritizing non-dilutive financing to maintain shareholder value, but this also means their debt coverage metrics, like Debt-to-EBITDA, are now a critical focus for lenders and investors alike.

Liquidity and Solvency

You want to know if CBIZ, Inc. (CBZ) has enough short-term cash to cover its bills, especially after its major acquisition activity. The short answer is yes, the liquidity position is solid, driven by strong accounts receivable and a business model that generates predictable cash flow. CBIZ's current and quick ratios, sitting near 1.60 as of the most recent reporting, are defintely reassuring.

For a professional services firm like CBIZ, which carries very little inventory, the Current Ratio (Current Assets / Current Liabilities) and the Quick Ratio (Acid-Test Ratio) are virtually identical. A ratio of 1.60 means the company has $1.60 in liquid assets for every dollar of short-term liability. This is a healthy buffer, showing the firm can easily meet its obligations over the next year without stress.

Working Capital and Cash Flow Overview

The company's working capital-the money left over if all current assets were used to pay all current liabilities-stood at approximately $368.24 million as of September 30, 2025. This is calculated from $1,010 million in Current Assets and $641.76 million in Current Liabilities. This positive balance is a strong indicator of operational efficiency, but you should remember that CBIZ's working capital is inherently lumpy.

The nature of their business means they pay out incentive compensation in the first quarter and accumulate significant accounts receivable during the tax season, which then gets collected later in the year. This seasonal pattern is normal, so a temporary dip earlier in the year is not a major liquidity concern-it's just how the accounting cycle works for an accounting and advisory firm.

The cash flow statement for the third quarter of 2025 shows the core business is working. CBIZ generated $48.85 million in cash from operating activities (CFO), which is the lifeblood of any healthy company. The cash used in investing activities (CFI) of ($16.91 million) is normal for a growing firm, covering capital expenditures and strategic acquisitions. The real action is in financing.

Near-Term Liquidity Strengths and Risks

The biggest near-term liquidity story is the post-acquisition balance sheet management. For the nine months ended September 30, 2025, CBIZ used $135.6 million for share repurchases, a significant capital return action, while also taking on $165.9 million in net proceeds from its 2024 Credit Facilities to fund the Marcum acquisition and other activities. This tells you they are actively managing their capital structure, using debt to fuel growth and acquisitions, while still returning value to shareholders.

• Maintain a 1.60 Current Ratio: Strong short-term solvency.
• Positive CFO: Core operations are profitable and cash-generative.
• Acquisition Debt: High debt load is a planned risk, tied to the Marcum deal.

The risk here is not an immediate lack of liquidity, but rather the increased debt load and the execution of the deleveraging plan. CBIZ's plan is to reduce its pro forma net leverage ratio from approximately 3.25x-3.50x to 2.00x-2.25x within 24 months, relying on that strong free cash flow. So, while the immediate liquidity is fine, the long-term solvency hinges on successful integration and cash flow generation to pay down that debt.

For a deeper dive into the company's strategic direction, check out the full post on Breaking Down CBIZ, Inc. (CBZ) Financial Health: Key Insights for Investors.

Valuation Analysis

You want to know if CBIZ, Inc. (CBZ) is a buy, a hold, or a sell right now. Based on a blend of current valuation multiples and recent stock performance, the stock is defintely trading at a premium to its historical average, but analysts are currently split, leading to a consensus of Hold.

The core issue is a high Price-to-Earnings (P/E) ratio, which suggests investors are baking in significant future growth. As of November 2025, the trailing twelve-month (TTM) P/E ratio sits around 34.25. This is notably higher than its five-year average P/E of 28.77, indicating a richer valuation than its recent history.

Here's the quick math on key valuation multiples for the 2025 fiscal year, using projected data where available:

• Price-to-Earnings (P/E): TTM P/E of 34.25x, with a projected 2025 P/E of 26.6x.
• Price-to-Book (P/B): The projected 2025 P/B is 1.84x.
• Enterprise Value-to-EBITDA (EV/EBITDA): The projected 2025 EV/EBITDA is a very reasonable 6.16x, which is a key metric for service firms.

The contrast between the high P/E and the lower EV/EBITDA is interesting. It suggests that while the market is paying a high price for earnings, the company's core operating profitability (EBITDA) relative to its total value (Enterprise Value) is not drastically overstretched. The Enterprise Value is currently around $3.26 Billion.

The stock price trend over the last 12 months shows significant volatility. CBIZ, Inc. (CBZ) hit an all-time high closing price of $88.65 in February 2025, but the stock has since pulled back sharply. The 52-week high was $90.13, and the 52-week low was $49.42. As of mid-November 2025, the stock is trading near its 52-week low, with a recent close around $49.80. This price drop, which included hitting a new 52-week low, shows the market has significantly repriced the stock following its early-year peak.

A major factor in your investment decision should be that CBIZ, Inc. (CBZ) is not a dividend-paying stock. The TTM dividend payout is $0.00, and consequently, the dividend yield and payout ratio are 0.00%. This means your return will come solely from capital appreciation, not income. If you are an income investor, this one is a pass. For a deeper dive into the company's long-term strategy, you can check their Mission Statement, Vision, & Core Values of CBIZ, Inc. (CBZ).

The analyst community reflects this complex picture. The current consensus is Hold, but this hides a split view: one analyst rates it a Buy, while another rates it a Sell. For example, Weiss Ratings downgraded the stock to a 'sell (d+)' in late October 2025. This mixed sentiment, coupled with a high P/E but a reasonable EV/EBITDA, suggests the stock is in a wait-and-see period, justifying the consensus Hold rating.

Risk Factors

You're looking at CBIZ, Inc. (CBZ) and seeing strong growth, largely powered by the Marcum acquisition, but you need to know what could trip them up. The direct takeaway is that while their core business is rock-solid-about 77% of their services are recurring-the near-term risks center on economic sensitivity in their advisory work and the sheer cost of integrating a massive acquisition. You defintely need to watch the pressure on their project-based revenue and their debt load.

The biggest external risk is the persistent market headwinds. This isn't just a vague macro-economic worry; it hits their top line directly. Management expects revenue to land at the low end of their full-year 2025 guidance of $2.8 billion to $2.95 billion because of this pressure. Plus, client pushback on rate increases is creating a projected $75 million headwind for the full year, which is a significant drag on organic growth.

The other major external risk is the volatility of their non-recurring, project-based work, which makes up roughly 23% of total revenue. Slowdowns in capital markets and deal-related services, like the planned wind-down of legacy Marcum special-purpose acquisition company (SPAC) practice, directly reduce this revenue.

Here's a quick look at the core risks and their financial impact for the 2025 fiscal year:

The integration of the Marcum acquisition is a huge strategic opportunity, but it's also an operational risk. Integration costs alone are budgeted at $75 million for 2025. On the financial side, the higher debt taken on for the cash portion of the acquisition has pushed net debt to approximately $1.6 billion as of the third quarter of 2025, which is why Q3 interest expense was $28 million.

But management is not sitting still; they are realists. They are mitigating the market risks by leaning into their core recurring businesses and implementing aggressive cost controls. They've already expedited workforce integration, cutting nearly 450 fewer full-time equivalent employees in core businesses. Plus, they are confident in realizing and potentially exceeding $25 million in synergies from the Marcum deal. To tackle the debt, the plan is to use most free cash flow to reduce leverage back below 2.5 times by the end of 2026.

• Focus on core recurring revenue (77%) for stability.
• Use variable cost controls to quickly adjust to revenue shortfalls.
• Target leverage reduction to below 2.5 times by 2026.

For a deeper dive into the company's long-term vision, you can check out their strategic direction here: Mission Statement, Vision, & Core Values of CBIZ, Inc. (CBZ).

Next Step: Finance should model the impact of a sustained $75 million revenue headwind on the full-year adjusted EBITDA margin.

Growth Opportunities

You're looking at CBIZ, Inc. (CBZ) and wondering if the growth story has legs beyond the big Marcum acquisition. Honestly, the answer is yes, but the growth drivers are shifting from a massive one-time jump to disciplined integration and strategic bolt-ons. The core of their near-term opportunity is realizing the full potential of their new scale in the high-growth U.S. middle market.

The company's full-year 2025 outlook is a solid anchor, projecting total revenue between $2.8 billion and $2.95 billion. This isn't just top-line fluff; the operational leverage is clear. Adjusted Earnings Per Share (EPS) is expected to land in the range of $3.60 to $3.65, with Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) forecast between $450 million and $456 million. Here's the quick math: they're expecting earnings to grow faster than revenue, which is a sign of successful integration and margin expansion.

Key Growth Drivers: Acquisition and Integration

The biggest immediate driver is the November 2024 Marcum acquisition, which was the largest in CBIZ, Inc.'s history and instantly made them one of the nation's largest professional services providers to the middle market. The integration is defintely on track, which is crucial, and they're already seeing better-than-expected synergies. The second phase of this integration alone is projected to yield an estimated $15 million in annualized savings.

Looking ahead, the strategy remains a blend of organic growth and M&A. The company maintains a healthy pipeline of new acquisition opportunities for the remainder of 2025, continuing its long-term strategy of using strategic deals to supplement its core business growth. For an in-depth look at who's betting on this strategy, you should check out Exploring CBIZ, Inc. (CBZ) Investor Profile: Who's Buying and Why?

• Marcum Integration: Realizing cost and revenue synergies.
• M&A Pipeline: Continuing strategic, smaller acquisitions in 2025.
• Organic Initiatives: Driving growth through pricing, yield, and new advisory projects.
• Cross-selling: Leveraging the expanded platform to sell services across accounting, tax, benefits, and insurance.

Competitive Edge and Resilience

CBIZ, Inc. is well-positioned for sustained growth because its competitive advantages are structural, not fleeting. The massive increase in scale from the Marcum deal makes the combined entity the seventh largest accounting firm in the U.S., giving them a distinct advantage in serving the middle-market. What this estimate hides is the power of their business model: approximately 72% of their revenue is recurring, coming from essential services like annual accounting and tax.

This high proportion of recurring revenue provides stability and predictability, which is a significant buffer against economic uncertainty, especially when demand for non-recurring advisory services slows. Plus, their client retention rate hovers around 90%, showing high customer satisfaction in a relationship-driven industry. Their people are the key differentiator.