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ManpowerGroup (MAN) is one of the largest companies in the global staffing industry. It serves each main staffing category--temporary, permanent, and project-based, and offers a suite of HR outsourcing and outplacement services.

The company has an established network of 2,500 offices in 75 countries and territories. It provides its staffing solutions through its four major brands – Manpower, which includes contingent staffing and permanent recruitment; ManpowerGroup Solutions, outsourcing services for large-scale recruiting; and Experis, professional resourcing and project-based workforce solutions.

We all know there is a massive labor shortage right now. That's excellent news for staffing companies such as MAN that get hired to find workers. In addition to the labor shortage, the company also benefits from the shift toward outsourcing recruitment as employers look to optimize labor efficiency and manage expenses.

The company has been looking to increase productivity and efficiency through investments in technology. For instance, it is implementing front office systems and cloud-based and mobile applications.

MAN is also making enhancements to its global technology infrastructure across several of its markets and investing in the digitalization of its workforce solutions. The company has also benefited from acquisitions.

Acquisitions have helped support its revenue growth. For instance, the company acquired the Switzerland Manpower franchise in 2019, LearnUp in 2017, and CIBER, Inc, a global information technology consulting company, in 2016. These buyouts help strengthen its portfolio.

MAN had a solid second quarter as global vaccination rates continued to increase. This led to accelerating hiring activity in many of the markets where MAN operates. In fact, most of the company's largest markets have vaccination rates at or above 40%, with some above 50%.

Second-quarter revenue rose 41% year over year and 7% sequentially. The Southern Europe region had the best growth as revenue rose 64% year over year. France was especially strong, as sales rose 83% year over year and 13% sequentially. France's economy saw a strong rebound, and this is expected to continue.

MAN also provided third-quarter guidance, where it forecasted revenue to rise between 14% and 18% and earnings between $1.86 and $1.94. The global recovery is expected to continue to drive hiring demand, and the company is in a strong position to capitalize on both temporary and permanent placements.

The tight labor markets also allow the company to reskill and upskill candidates, which makes it easier for them to get placed on assignments. Plus, hiring activity should remain strong in the near term with vaccination rates increasing.

The company has an overall grade of B, translating into a Buy rating in our POWR Ratings system. MAN has a Growth Grade of A due to growth in the most recent quarter and forecasted growth. Analysts expect earnings to rise 58.3% in the current quarter and 92.1% for the year.

The company also has a Value Grade of A due to MAN's attractive valuation metrics. For instance, the stock has a forward P/E of 17.24, and its price-to-sales ratio of 0.3 is well below the industry average of 2.2.

We also provide Momentum, Stability, Sentiment, and Quality grades for MAN, which you can find here. MAN is ranked #5 in the A-rated Outsourcing – Staffing Services industry. You can find more top stocks in this top-rated industry by clicking here.  

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MAN shares were trading at $120.31 per share on Wednesday morning, down $1.11 (-0.91%). Year-to-date, MAN has gained 34.79%, versus a 21.79% rise in the benchmark S&P 500 index during the same period.

David Cohne has 20 years of experience as an investment analyst and writer. He is the Chief Value Strategist for StockNews.com and the editor of POWR Value newsletter. Prior to StockNews, David spent eleven years as a consultant providing outsourced investment research and content to financial services companies, hedge funds, and online publications. David enjoys researching and writing about stocks and the markets. He takes a fundamental quantitative approach in evaluating stocks for readers.

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