Adecco shares: Price analysis before buying or selling

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Yes

ISIN code: CH0012138605

Ticker: SWX: ADEN

Index or market: SMI

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Elements to consider before selling or buying Adecco shares

Analysis N°1

Demand from labour markets, particularly the growing shortage of executives who could benefit the Adecco group.

Analysis N°2

The digital market, which is currently growing strongly, must also be closely followed due to the business development opportunities of Adecco that it represents.

Analysis N°3

The development of Adecco's activities outside of France and the European Union is also an important element and you should particularly follow the takeover operations of foreign companies and the opening of branches in certain countries of the world.

Analysis N°4

The Adecco Group communicates its strategic plans and objectives a great deal so you can rely on these elements to get signals of a rise or drop.

Analysis N°5

Finally, keep an eye on the direct and indirect competition of this sector and on the evolution of its market shares as well as the news of its main players.

Analysis before buying or selling Adecco shares

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General presentation of Adecco

The Adecco group is a company based in Switzerland which offers human resources services all over the world. It is also the international leader in this sector of activity. However, the activities of the Adecco Company can be divided into three major hubs according to the share of turnover they generate:

Temporary employment activities in companies represent the largest part of turnover with more than 87.7% of the group's overall turnover.
Full-time employment of personnel in companies represents around 2% of the turnover achieved by the group.
Finally, the remaining 10% of turnover is generated by ancillary activities such as reintegration and career support services, management training services, organizational consulting and personal development.

If we were to break down the turnover of this group according to the sectors of activity regarding its client companies, there is a predominance of the industrial services sector which generates 50.6% of total turnover, followed by administrative services with 24.2 % of overall turnover. Next come information technology with 11.3% of turnover, engineering with 4.9% of turnover, finance and accounting with 4.1% of turnover and finally the health sector with 2% of turnover.

Adecco's activities are spread all over the world thanks to a network of over 5,100 branches in various countries. However, it is in France that Adecco achieves the greatest part of its turnover with 22.1%. Next comes the United States with 20.1% of turnover, the United Kingdom with 9.7%, Germany with 7.3%, Italy with 6.5%, Japan with 5.6% of turnover and Switzerland with only 2% of turnover. The remaining 26.7% is made in the rest of the world.

Photo credits: ©neydt/123RF.COM

The factors in favour of a rise in the Adecco share price:

We'll begin this study of the strengths and weaknesses of the Adecco group with a summary of the main assets available to the company ergo the elements in favour of supporting its growth over the long term.

Among the main strengths of the Adecco group, of course, is the fact that the company has been able to implement a particularly effective international expansion strategy. Thanks to this strategy, the group is now positioned on a global scale and owns and operates temporary employment agencies in a large number of countries. This allows it to generate more income, but also benefit from better protection against the risk of localized recession in the activity.
Another undeniable asset of the Adecco group is its brand image, which has of course been the subject of a well-thought-out strategy. The group has set up marketing campaigns and advertising campaigns that have helped it to make itself known to the general public and make its brand a brand recognized around the world.
The positioning of the Adecco group in its sector of activity is another of its strengths. The group today enjoys a certain leadership and is positioned among the largest companies in this sector not only in Europe but throughout the world. This allows it to have a head start over its main competitors.
Finally, another advantage available to the Adecco group and which allows it to reassure investors and shareholders this time is its recruitment quota. By successfully recruiting a large number of temporary employees, Adecco has strong negotiating power with large groups, many of which are part of its client portfolio.

The factors in favour of a drop in the Adecco share price:

As we mentioned above, the Adecco group also has weak points that you must absolutely take into account before any analysis of this value and before any position is to be made on this share. Here are the main weaknesses that the company currently suffers from and which could affect its future results and growth:

First of all, among them is the growing weakness of certain sectors of activity which are part of its core target. This is particularly the case with the construction sector, which represents the major part of the group's income and has been in decline for several years. This decline could ultimately weigh on the profitability of the group, which specializes, in part, in this segment.
Competition is also one of the major weaknesses of the Adecco group. Although it is still the leader of the temporary employment sector in many economies, it has to face serious competition from other large groups as well as more discreet competition who are actually very present as smaller players of this market.
Still regarding the disadvantages of this value and the weaknesses of the company, bear in mind that the Adecco group has been suffering for some time from the weak economic recovery. The health crisis linked to Covid-19 and which caused the employment figures to drop is of course for something, but even before this crisis, the world was experiencing a certain economic slowdown which must be taken into account here as part of a long-term vision of the activities of the company.
Finally, the last weak point of the Adecco group this time relates to its difficulties in keeping up to date with the digitization and dematerialization of its services, its activity still functioning largely thanks to the network of physical agencies.

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions or a solicitation to buy or sell an asset.

Frequently Asked Questions

How is the Adecco group positioned in its sector of activity?

As you probably already know, the Adecco group is currently one of the global giants of the human resources and temporary employment sector worldwide. It's therefore one of the leaders in this sector of activity throughout the world and is currently the largest company in this sector in France and in Europe. Due to its positioning, Adecco holds a large part of the market share, but its positioning is also threatened by competition and it could lose its leadership position.

Who are the major private shareholders of the Adecco group?

Currently, the shareholding of the Adecco group consists of certain private shareholders that you can see here: Harris Associates with 11.6%, Silchester International Investors with 5.12%, Philippe Foriel Destezet with 5.01%, Marathon Asset Management with 3.05%, Norges bank Investment Management with 2.98%, The Vanguard Group with 2.62%, Henderson Global Investors with 2.38%, DWS Investment with 2.13%, Invesco Asset Management with 2.01% or even Fiduciary Management with 1.89%.

Where can I find the financial data of the Adecco group online?

Although the annual or quarterly financial results of the group are published and taken up by many stock exchange and economic sites, you can find a lot of other interesting information about the group's finances by visiting the investors and shareholders section of the Adecco group's official website. You'll find details of the balance sheets as well as the group's strategic development plans.

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Analysis before buying or selling Adecco shares

How to buy and sell Adecco shares with eToro?

Elements to consider before selling or buying Adecco shares

General presentation of Adecco

Frequently Asked Questions