Here’s Why Kelly Services (KELYA) Slid in Q3

Core Insights - Palm Valley Capital Fund's performance in Q4 2025 showed a 0.66% appreciation, underperforming the S&P SmallCap 600's 1.70% gain and the Morningstar Small Cap Total Return Index's 3.12% rise [1] - The Fund increased its allocation to Treasury bills from 74.1% to 76.3% during the quarter, while equity holdings rose by 1.12% [1] - Precious metals, particularly silver, significantly contributed to the Fund's equity performance [1] Company-Specific Insights - Kelly Services, Inc. (NASDAQ:KELYA) was highlighted as a key stock in the Fund's Q4 2025 letter, with a one-month return of -1.70% and a 52-week loss of 37.12% [2] - As of January 5, 2026, Kelly Services' stock closed at $8.69, with a market capitalization of $307.096 million [2] - Kelly Services was one of the top three detractors from the Fund's performance, primarily due to failing to meet third-quarter guidance and providing a weak outlook [3] - The staffing industry is showing signs of stabilization, with the ASA Staffing Index reporting year-over-year gains in hours, despite Kelly's recent struggles [3] - There is a belief that AI is often used as a scapegoat for workforce reductions, as seen in Amazon's recent announcement of 30,000 corporate job cuts [3]