ManpowerGroup - A Strong Buy Ahead Of Earnings

The ManpowerGroup (NYSE:MAN), one of the most recognized global brands in terms of staffing, recruiting and other workforce solutions, is expected to release its earnings report on April 20th before the market opens.

As a Wall Street darling, this company trades on the New York Stock Exchange, and we believe it should be considered a good strong buy ahead of earnings.

What Makes MAN So Attractive

To start off with, MAN has a long history of beating the earnings per share forecasts issued by analysts. For 32 consecutive quarters, MAN has managed to produce EPS figures higher than expectations, and a similar situation can be observed in terms of revenue, which the company has beaten over 21 of the last 32 quarters.

There is no question that seasoned traders anxiously await MAN earnings calls; shares of this company have moved upwards on the trading session immediately following the release of the report. Since this earnings call traditionally takes before the opening bell, morning traders tend to be fond of MAN.

Shares of MAN have a history of moving towards profit territory during the first trading day after the earnings call. This is a pattern that have been observed 19 times over the last 24 quarters.

The most recent estimate issued by the company suggests that its first quarter EPS could be expected in the range between $1.06 and $1.14 while the current analyst consensus is at $1.11. The current EPS surprise factor is 3.4 percent.

Recent Stock Performance

Value investors should take a closer look at MAN. Although the P/E ratio of 15.54 is attractive on its own, its persistent earnings growth (PEG) ratio of 0.75 looks even better. Use of the PEG ratio as an investment strategy is a tool used by legendary investors such as Peter Lynch.

The year-to-date price of MAN shares has gained 10 percent while the year-over-year gain stands at 25 percent as of early April.

It is worth mentioning that MAN is known among Wall Street analysts as a company that really knows how to get good return on investment for the benefit of shareholders. Over the last 12 months, ROI for MAN has been 11.33, more than half point higher than the industry average of 10.67.

Job Creation and the Future of the ManpowerGroup

MAN happens to be enjoying the flurry of positive job reports coming out since the early days of the Trump administration. The latest ADP survey indicates that private payrolls grew by 263,000 new jobs from February to March; this figure was considerably higher than the 185,000 estimate formulated by economist who follow the American job market.

As a premier staffing company, MAN stands to benefit from the current labor market. In fact, the company's own Employment Outlook Survey conducted among 11,000 American employers, 13 industrial sectors are expected to increase their hiring pace in the next few months.

Overall, MAN is certainly an attractive stock not only in terms of price action following its earnings report but also as a value investment.

 

Disclosure:  I am/we are long MAN.

Disclaimer: I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship ...

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