Shares of organizational consulting firm Korn/Ferry (KF) have dropped sharply following the company's report of its first-quarter results Thursday night.

RESULTS: Korn/Ferry reported fee revenue of $465.6M in Q1, which it said was a 16.0% increase from the same period of last year, driven by organic growth in all solutions. Adjusted diluted EPS of 78c in Q1 were up from adjusted EPS of 55c in the same quarter of last year and topped the consensus analyst forecast of 71c. CEO Gary Burnison said, "I am pleased to report fee revenue of approximately $466M and strong profits, with adjusted EBITDA of approximately $71M during our recently completed first quarter." He added: "As disclosed last quarter, we are sunsetting our legacy logos and migrating to one unified brand -- Korn Ferry. Over the next 15 months, we will continue to move our organization towards an industry, solution and geographic orientation to capture the substantial opportunity we have as an organizational consulting firm." For the second quarter, the company expects EPS of 76c-84c, compared to a consensus forecast of 80c. Korn/Ferry sees Q2 fee revenue of $470M-$490M, compared to a consensus forecast of $476.7M.

CREDIT SUISSE SAYS SELL: In a note to investors following the quarterly report, Credit Suisse analyst Kevin McVeigh said that Korn/Ferry shares "should slip" 1-7% "if markets are efficient," given the likelihood of decelerating revenue growth in Q2 and what he views as elevated expectations. Last night's report was the first in five quarters where the company did not produce a "meaningful" beat and raise, added McVeigh. Executive search consultant headcount decelerated for a fourth consecutive quarter while Korn/Ferry consulting headcount slipped for the third consecutive quarter sequentially, added the analyst in a note titled "Slowing revenue + peak margins = sell KFY." McVeigh kept an Underperform rating on the stock, though he raised his price target to $58 from $55.

PRICE ACTION: In afternoon trading, Korn/Ferry shares are down $15.06, or 23.5%, to $49.05.