Equity Analysis /
United Kingdom

GB : Hays - Still a long way back to peak

    James Allen
    James Allen

    Analyst - Support Services & Special Situations

    Contributors
    Sanjay Vidyarthi
    Joe Brent
    CGS-CIMB
    19 April 2021
    Published by

    We increase our FY21E EBIT by 50% to £89.8m, 6% ahead of management’s £85m guidance. As with peers, stronger than expected net fee income in March, combined with lower y-o-y headcount, has led to high productivity and EBIT drop-through. Hays has put investment for longer-term growth ahead of shorter-term margins and this may mean that the return to peak EBIT is longer than for peers. The valuation is the highest in our peer group. We raise our TP from 155p to 175p. Maintain Hold.