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Adecco Group AG (CH:ADEN)
:ADEN
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Adecco Group AG
(ADEN)
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Rating:67Neutral
Price Target:
CHF24.50
▲(1.24% Upside)
Adecco Group AG's overall stock score is driven by a strong earnings call performance and reasonable valuation. However, financial performance challenges, particularly in revenue growth and profitability, along with bearish technical indicators, weigh on the score. The company's strategic initiatives and market share gains provide a cautiously optimistic outlook.
Positive Factors
Market Share Gains
Adecco's market share gains demonstrate competitive strength and effective strategies, positioning the company for sustained leadership in the staffing industry.
Strong U.S. Performance
The robust growth in the U.S. market highlights Adecco's successful execution of its turnaround strategy, contributing to long-term revenue stability.
Cash Flow and Operating Leverage
Strong cash flow and improved operating leverage enhance Adecco's financial flexibility, supporting future investments and shareholder returns.
Negative Factors
Revenue Growth Challenges
Negative revenue growth suggests difficulties in market expansion, which could hinder long-term profitability and competitive positioning.
Permanent Placement Revenue Decline
Declining permanent placement revenues indicate market uncertainty, potentially impacting Adecco's ability to capitalize on stable, high-margin services.
Akkodis Germany Challenges
Revenue declines in Akkodis Germany, driven by automotive sector headwinds, highlight regional and sector-specific vulnerabilities affecting growth.
Adecco Group AG (ADEN) vs. iShares MSCI Switzerland ETF (EWL)
Market Cap
CHF3.73B
Dividend Yield4.13%
Average Volume (3M)842.19K
Price to Earnings (P/E)13.7
Beta (1Y)1.12
Revenue Growth-4.68%
EPS Growth-5.79%
CountryCH
Employees33,597
SectorServices
Sector StrengthN/A
IndustryStaffing & Employment Services
Share Statistics
EPS (TTM)0.62
Shares Outstanding168,426,560
10 Day Avg. Volume653,147
30 Day Avg. Volume842,188
Financial Highlights & Ratios
PEG Ratio-1.96
Price to Book (P/B)1.12
Price to Sales (P/S)0.17
P/FCF Ratio7.08
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
CHF31.00Price Target Upside28.10% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Adecco Group AG Business Overview & Revenue Model
Company DescriptionAdecco Group AG, together with its subsidiaries, provides human resource services to businesses and organizations in Europe, North America, Asia Pacific, South America, and North Africa. It offers flexible placement, permanent placement, outsourcing, training, upskilling and reskilling, career transition and workforce transformation, technology consulting and talent, tech academy, digital staffing services, and talent advisory and solutions under the Adecco, Adia, General Assembly, Badenoch + Clark, LHH, pontoon, Spring, and Modis. The company also operates Hired, a talent recruitment platform. As of December 31, 2021, it operated approximately 4,300 branches in 59 countries and territories. The company was formerly known as Adecco S.A. Adecco Group AG was founded in 1957 and is based in Zurich, Switzerland.
How the Company Makes MoneyAdecco Group AG generates revenue primarily through its staffing and recruitment services. The company charges clients a fee based on a percentage of the employee's salary or a fixed amount for placing candidates in temporary or permanent roles. Key revenue streams include temporary staffing services, which account for a significant portion of earnings, as well as permanent placements and outsourcing services. Additionally, Adecco offers consulting services related to workforce management and employee training, further diversifying its income sources. Strategic partnerships with various organizations enhance its service offerings, while economic factors and labor market trends significantly impact its earnings.
Adecco Group AG Earnings Call Summary
Earnings Call Date:Nov 06, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 26, 2026
Earnings Call Sentiment Positive
The earnings call reflected a strong overall performance with significant market share gains and impressive growth in the U.S. market. However, challenges remain in specific areas such as Akkodis Germany and permanent placement revenues. The group's strategic initiatives and cost management efforts are yielding positive results, suggesting a cautiously optimistic outlook.Q3-2025 Updates
Positive Updates
Revenue Growth and Market Share Gains
The Adecco Group delivered EUR 5.8 billion in revenues, a 3.4% year-on-year increase on an organic trading days adjusted basis. The group gained significant market share, with the group and Adecco leading key competitors by 375 and 300 basis points, respectively.
Strong U.S. Performance
Adecco U.S. reported a remarkable 20% year-on-year revenue increase, demonstrating significant progress in its turnaround plan.
Cash Flow and Operating Leverage
Cash conversion was strong at 110%, with the group generating a solid operating cash flow of EUR 200 million, up EUR 79 million from the prior year period. Productivity increased by 8% year-on-year.
G&A Savings and EBITA Margin Improvement
The group achieved EUR 174 million in G&A savings, with the EBITA margin improving to 3.4%, evidencing good operating leverage.
Training and Upskilling Growth
Training, upskilling, and reskilling services saw underlying growth of 28%, with EZRA and General Assembly reporting outstanding growth of 59% and 48%, respectively.
Negative Updates
Challenges in Akkodis Germany
Akkodis' revenues were 3% lower year-on-year on an organic constant currency basis, with Germany's revenues down 9%, driven by market headwinds in the automotive sector.
Perm Placement Revenue Decline
Permanent placement revenues declined by 7% in Adecco and 8% in LHH, reflecting broader market hesitancy in permanent hiring due to geopolitical uncertainties.
Logistics Sector Challenges
The logistics sector presented challenges, with revenues down year-on-year, impacting growth particularly in France, Germany, and Spain.
Company Guidance
During the Adecco Group's Q3 2025 earnings call, the company provided strong financial guidance backed by several key metrics. Revenues reached EUR 5.8 billion, representing a 3.4% increase year-on-year on an organic trading days adjusted basis, with a notable 20% revenue surge in Adecco U.S. Gross profit stood at EUR 1.1 billion, maintaining a gross margin of 19.2%, which, despite a modest year-on-year decrease, showed a sequential improvement of 30 basis points, aligning with Q3 guidance. The EBITA margin, excluding one-offs, was reported at 3.4%, with EBITA itself at EUR 195 million. Productivity rose by 8% year-on-year, enhancing operating leverage. The adjusted EPS was EUR 0.67, and the company reported robust cash conversion at 110%, generating operating cash flow of EUR 200 million, a EUR 79 million increase from the previous year. The group highlighted its progress in market share growth, with Adecco gaining 300 basis points. Moving forward, Adecco aims to maintain this trajectory, targeting a 3% EBITA margin floor for the full year and focusing on delivering sustainable growth, improving margins, and creating long-term shareholder value.Adecco Group AG Financial Statement Overview
Summary
Adecco Group AG demonstrates stable core operations with consistent gross margins but faces challenges in revenue growth and profitability. The balance sheet is moderately leveraged, providing a stable financial base. Cash flow generation shows some weaknesses, particularly in free cash flow growth. Overall, the company maintains a stable financial position but needs to address growth and profitability challenges to improve its financial health.Income Statement
Adecco Group AG's income statement shows a mixed performance. The gross profit margin is stable around 19-21%, indicating consistent profitability from core operations. However, the net profit margin has declined to 1.26% in TTM, reflecting reduced overall profitability. Revenue growth is negative in recent periods, indicating challenges in expanding sales. EBIT and EBITDA margins have also decreased, suggesting pressure on operational efficiency.65
Positive
Balance Sheet
The balance sheet reflects a moderate financial position. The debt-to-equity ratio is slightly above 1, indicating a balanced but slightly leveraged capital structure. Return on equity is around 8.4% in TTM, showing moderate efficiency in generating returns for shareholders. The equity ratio is not directly provided, but the overall asset base supports a stable financial structure.70
Positive
Cash Flow
Cash flow analysis reveals some concerns. Free cash flow growth is negative in TTM, indicating potential challenges in generating cash. The operating cash flow to net income ratio is low, suggesting limited cash generation relative to net income. However, the free cash flow to net income ratio remains healthy at 77.9%, indicating decent cash conversion from profits.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 22.93B | 23.14B | 23.96B | 23.64B | 20.95B | 19.56B |
| Gross Profit | 4.41B | 4.50B | 4.97B | 4.97B | 4.28B | 3.79B |
| EBITDA | 718.00M | 760.00M | 841.00M | 770.00M | 971.00M | 307.00M |
| Net Income | 290.00M | 303.00M | 325.00M | 342.00M | 586.00M | -97.00M |
Balance Sheet | ||||||
| Total Assets | 11.85B | 12.10B | 12.43B | 13.26B | 11.87B | 9.79B |
| Cash, Cash Equivalents and Short-Term Investments | 270.00M | 482.00M | 556.00M | 782.00M | 3.05B | 1.49B |
| Total Debt | 3.65B | 3.48B | 3.67B | 3.70B | 3.48B | 2.29B |
| Total Liabilities | 8.64B | 8.51B | 8.83B | 9.36B | 8.06B | 6.57B |
| Stockholders Equity | 3.20B | 3.58B | 3.60B | 3.88B | 3.79B | 3.21B |
Cash Flow | ||||||
| Free Cash Flow | 415.00M | 563.00M | 347.00M | 328.00M | 590.00M | 563.00M |
| Operating Cash Flow | 549.00M | 707.00M | 563.00M | 543.00M | 722.00M | 720.00M |
| Investing Cash Flow | -144.00M | -157.00M | -209.00M | -1.45B | -206.00M | -162.00M |
| Financing Cash Flow | -416.00M | -634.00M | -620.00M | -1.38B | 980.00M | -290.00M |
Adecco Group AG Technical Analysis
Positive
24.20
Price Trends
22.93
Positive
24.13
Positive
23.55
Positive
Market Momentum
>-0.01
Negative
61.23
Neutral
65.85
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:ADEN, the sentiment is Positive. The current price of 24.2 is above the 20-day moving average (MA) of 23.06, above the 50-day MA of 22.93, and above the 200-day MA of 23.55, indicating a bullish trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 61.23 is Neutral, neither overbought nor oversold. The STOCH value of 65.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CH:ADEN.
Adecco Group AG Peers Comparison
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Sector (55)
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CH:SGSN
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.