<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Shares of global staffing and outsourcing services company ManpowerGroup Inc. (NYSE:MAN) plunged nearly 6% on Friday morning following the announcement of its most recent quarterly results. This is a massive single-session movement in the company’s stock price based on historical volatility.” data-reactid=”11″>Shares of global staffing and outsourcing services company ManpowerGroup Inc. (NYSE:MAN) plunged nearly 6% on Friday morning following the announcement of its most recent quarterly results. This is a massive single-session movement in the company’s stock price based on historical volatility.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The stock was trading at about $91.60 per share at the time of writing on, down from $97.48 at 9:30 a.m. Eastern on Jan. 31. ManpowerGroup closed at $93.94 on Thursday ahead of Friday’s pre-market earnings release. The fall comes despite the company delivering earnings that beat analyst expectations.” data-reactid=”26″>The stock was trading at about $91.60 per share at the time of writing on, down from $97.48 at 9:30 a.m. Eastern on Jan. 31. ManpowerGroup closed at $93.94 on Thursday ahead of Friday’s pre-market earnings release. The fall comes despite the company delivering earnings that beat analyst expectations.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Highlights from the recent quarter” data-reactid=”27″>Highlights from the recent quarter
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="ManpowerGroup posted significant declines in fourth-quarter revenue and earnings compared to the prior year. Earnings of $2.15 per share were down from $2.44 in fourth-quarter 2018. Analysts were expecting earnings of $2.04 per share. Revenue fell 4% from the year-ago quarter to $5.2 billion.” data-reactid=”28″>ManpowerGroup posted significant declines in fourth-quarter revenue and earnings compared to the prior year. Earnings of $2.15 per share were down from $2.44 in fourth-quarter 2018. Analysts were expecting earnings of $2.04 per share. Revenue fell 4% from the year-ago quarter to $5.2 billion.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="ManpowerGroup’s annual net income also declined to $7.72 per share from $8.56 in 2018, while revenue edged 5% lower to $20.9 billion. The company’s annual earnings were affected by changes in foreign exchange to the tune of 28 cents per share.” data-reactid=”29″>ManpowerGroup’s annual net income also declined to $7.72 per share from $8.56 in 2018, while revenue edged 5% lower to $20.9 billion. The company’s annual earnings were affected by changes in foreign exchange to the tune of 28 cents per share.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="During the year, Manpower repurchased 2.4 million shares of common stock for a total of $203 million, which boosted the stock price performance. ” data-reactid=”30″>During the year, Manpower repurchased 2.4 million shares of common stock for a total of $203 million, which boosted the stock price performance.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="ManpowerGroup has been growing earnings consistently over the last five years, but that streak could end following the 2019 results. ” data-reactid=”31″>ManpowerGroup has been growing earnings consistently over the last five years, but that streak could end following the 2019 results.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The company pays dividends at just 26.5% of earnings, which leaves enough room for dividend growth. Its current annual dividend rate of $2.18 per share equates to a decent yield of 2.38%.” data-reactid=”32″>The company pays dividends at just 26.5% of earnings, which leaves enough room for dividend growth. Its current annual dividend rate of $2.18 per share equates to a decent yield of 2.38%.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="In comparison, Robert Half International Inc. (NYSE:RHI), one of ManpowerGroup’s closest peers, trades at a dividend yield of 2.11% while Kforce Inc. (NASDAQ:KFRC) is paying shareholders dividends at a yield of 1.93%. ” data-reactid=”33″>In comparison, Robert Half International Inc. (NYSE:RHI), one of ManpowerGroup’s closest peers, trades at a dividend yield of 2.11% while Kforce Inc. (NASDAQ:KFRC) is paying shareholders dividends at a yield of 1.93%.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Should you buy Manpower?” data-reactid=”34″>Should you buy Manpower?
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Despite Friday’s plunge, Manpower still looks like an interesting option for short-term investors who target stock price rebounds. The company’s 12-month forward price-earnings ratio also looks relatively attractive at 11.99 compared to Robert Half’s 13.24 and Kforce’s 13.48. ” data-reactid=”35″>Despite Friday’s plunge, Manpower still looks like an interesting option for short-term investors who target stock price rebounds. The company’s 12-month forward price-earnings ratio also looks relatively attractive at 11.99 compared to Robert Half’s 13.24 and Kforce’s 13.48.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="However, when we factor in five-year expected earnings growth, Manpower becomes significantly expensive compared to its peers with a price-earnings to growth ratio of 8.46. On the other hand, Kforce’s PEG ratio stands at 0.53 and Robert Half’s is 2.48.” data-reactid=”36″>However, when we factor in five-year expected earnings growth, Manpower becomes significantly expensive compared to its peers with a price-earnings to growth ratio of 8.46. On the other hand, Kforce’s PEG ratio stands at 0.53 and Robert Half’s is 2.48.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="In regard to its industry outlook, Manpower published a report that found global talent shortages doubled over the last decade. In hindsight, this provides the company with a huge opportunity to grow its wholly-owned subsidiary, Right Management, which focuses on talent identification, training and nurturing.” data-reactid=”37″>In regard to its industry outlook, Manpower published a report that found global talent shortages doubled over the last decade. In hindsight, this provides the company with a huge opportunity to grow its wholly-owned subsidiary, Right Management, which focuses on talent identification, training and nurturing.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="However, the company will have to battle a growing list of staffing and outsourcing companies, as well as alternative hiring platforms, to take full advantage of the opportunity. Robert Half will be the primary rival globally, while Microsoft Corp.’s (NASDAQ:MSFT) LinkedIn will provide an interesting alternative.” data-reactid=”38″>However, the company will have to battle a growing list of staffing and outsourcing companies, as well as alternative hiring platforms, to take full advantage of the opportunity. Robert Half will be the primary rival globally, while Microsoft Corp.’s (NASDAQ:MSFT) LinkedIn will provide an interesting alternative.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Disclosure: No positions in the stocks mentioned.” data-reactid=”39″>Disclosure: No positions in the stocks mentioned.
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