Judgment: HOLD Steady execution (2024 revenue ~$1.15B, net income ~$53M; Q3’25 net income ~$20.6M) and a clean balance sheet (net cash, no LOC borrowings) support the story, and the high-touch model with captive insurance provides stickiness. However, risk/reward looks balanced: P/E ~16.7 is reasonable but EV/EBITDA ~30.6 is rich for thin-margin PEO economics, free cash flow is variable, and geographic concentration is high (≈72% of 2024 revenue from California), keeping regulatory and workers’ comp exposure elevated. WATCH ITEMS: • Workers’ compensation loss experience and reserve development: sustained improvement that expands margins and reduces volatility would tilt to BUY; adverse development would push to SELL. • Worksite employee/payroll growth and admin-fee/pricing: accelerating volumes with stable pricing/margins would justify a BUY; stagnation or pricing pressure would argue for a more cautious stance. • California regulatory/insurance backdrop: favorable WC rate environment or diversification away from CA would de-risk and support a BUY; adverse CA policy changes or claim severity spikes would drive a SELL/REDUCE.