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ManpowerGroup Hits New 52-Week High on Strong Growth Drivers

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Shares of business services provider ManpowerGroup Inc. (MAN - Free Report) hit a new 52-week high of $110.53 on Jun 29, before closing the trading session a notch lower at $110.37, for a healthy year-to-date return of 25.34%.

In the last one month, the stock has been volatile. Due to the fluctuations in its price, the stock carries a Zacks Rank #3 (Hold). It currently has a long-term earnings growth expectation of 12.00%.

Growth Drivers

On Jun 13, 2017, Manpower collaborated with Rockwell Automation Inc. (ROK - Free Report) to train 1,000 military veterans for advanced manufacturing jobs. Both the companies are working closely together, utilizing existing programs to train veterans in advanced digital manufacturing jobs and other higher-tech roles in the industry. Per a survey conducted by ManpowerGroup, most U.S. employers anticipate that at a higher skill level automation will increase the headcount. This will, in turn, help the company expand its foothold and augment its top line.

The company has outperformed the Zacks categorized  Staffing Firms industry with an average gain of 7.2% in the last three months as against 0.2% decline for the latter. ManpowerGroup is continuously making significant investments to expand permanent recruitment solutions offerings. Management continues to believe that global recovery is on track but at a slow and uneven pace. As a result, it is focusing on internal drivers like disciplined pricing and tough control on productivity to ensure uninterrupted profitability.

The company believes that its European business would strengthen in the quarters ahead. It is poised to grow on the back of productive workforce and sound restructuring initiatives. ManpowerGroup remains a good bet for growth and yield-seeking investors. The company is likely to benefit from its cost recalibration and simplification plan.

Its wide range of services makes the company a true global staffing firm. The company provides services for the entire employment and business cycle including permanent, temporary and contract recruitment, employee assessment and selection, training, outplacement, outsourcing and consulting. The company’s brand value and strong global network provide it a competitive advantage and reinforces its dominant position in the market. The company leverages a well-established network of approximately 2,900 offices across 80 countries and serves approximately 400,000 clients.

Stocks to Consider

A couple better-ranked stocks in the industry include BG Staffing, Inc. (BGSF - Free Report) and Randstad Holding NV (RANJY - Free Report) . Both the stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

BG Staffing is currently trading at a forward P/E of 16.8x.

Randstad has a long-term earnings growth expectation of 8% and is currently trading at a forward P/E of 12.5x.

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