Analyst Heather Balsky of Bank of America Securities reiterated a Sell rating on ManpowerGroup (MAN – Research Report), with a price target of $55.00.
Heather Balsky’s Sell rating for ManpowerGroup is rooted in a confluence of economic difficulties and sector-specific conditions. The company faces substantial challenges in its most significant markets, the United States and Europe, which collectively constitute a majority of its sales. With economic growth in these regions remaining sluggish, there’s an anticipation of continued reduction in permanent staffing demand that is likely to exert additional pressure on the company’s profit margins. As a result, Balsky has downgraded earnings estimates while maintaining the Underperform rating and a price objective of $55, even after factoring in an increased P/E multiple to align with peer re-ratings.
Specifically, in Europe, which is central to ManpowerGroup’s business, there are persistent headwinds. France, which represents a significant portion of sales, has shown a deceleration in temporary employment, indicating a tough quarter ahead. Moreover, supply chain disruptions due to events in the Red Sea and canal regions could further affect the company’s sales, given its substantial customer base in the manufacturing and transportation sectors. The projected earnings per share for the fourth quarter are also a tad below the consensus, contributing to the rationale behind the Sell rating.
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ManpowerGroup (MAN) Company Description:
ManpowerGroup, Inc. engages in the provision of workforce solutions and services. It operates through the following segments: Americas, Southern Europe, Northern Europe, Asia Pacific Middle East, and Right Management. The Americas segment offers services as Manpower, Experis, and ManpowerGroup Solutions through both branch and franchise offices. The Southern Europe segment provides permanent, temporary and contract recruitment, assessment and selection, training and outsourcing services. The Northern Europe includes comprehensive suite of workforce solutions and services through Manpower, Experis, ManpowerGroup Solutions in the United Kingdom, the Nordics, Germany, and the Netherlands. The Asia Pacific Middle East segment operates in Japan, Australia, Korea, China, and India. The Right Management segment delivers talent and career management workforce solutions. The company was founded by Elmer Winter and Aaron Scheinfeld in 1948 and is headquartered in Milwaukee, WI.
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