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ManpowerGroup Hits New 52-Week High on Strategic Initiatives


Shares of business services provider ManpowerGroup Inc. MAN hit a new 52-week high of $117.81 on Jul 14, before closing the trading session a tad lower at $117.47, for a healthy year-to-date return of 32.2%.

In the last one month, the stock has witnessed an uptrend. Owing to the upward movement in its price, the stock sports a Zacks Rank #1 (Strong Buy). It currently has a long-term earnings growth expectation of 12.00%.

Growth Drivers

The company has restructured its senior management with the strategic appointment of Becky Frankiewicz as the President of its North American business. Frankiewicz has a rich history of working with some of the top names in the industry. Before joining ManpowerGroup, she was leading Innovation & Strategy, Finance and Marketing across the Pepsico, Inc. PEP portfolio. Her expertise in the field will help ManpowerGroup enhance its client offerings.

On Jun 13, 2017, Manpower collaborated with Rockwell Automation Inc. ROK 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 a higher skill level automation will increase the headcount. This will, in turn, help the company expand foothold and augment its top line.

The company has outperformed the Zacks categorized Staffing Firms industry with an average gain of 18.3% in the last three months compared with 8.2% rally 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 and it is poised to grow on the back of productive workforce and sound restructuring initiatives. Also, it is likely to benefit from its cost recalibration and simplification plan. All these positives make ManpowerGroup a good bet for growth and yield-seeking investors.

Its wide range of services makes the company a true global staffing firm. It 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.

A Stock Worth Considering

Another stock in the industry worth considering is Randstad Holding NV RANJY, which carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Randstad has a long-term earnings growth expectation of 8% and is currently trading at a forward P/E of 12.4x.

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