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Adecco Group AG (CH:ADEN)
:ADEN
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Adecco Group AG
(ADEN)
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Rating:65Neutral
Price Target:
CHF22.50
▼(-0.53% Downside)
Adecco Group AG's overall stock score is driven by a strong earnings call performance and attractive valuation metrics, offset by challenges in financial performance and bearish technical indicators. The company's strategic initiatives and market share gains are positive, but operational efficiency and profitability improvements are needed to enhance financial performance.
Positive Factors
Market Share Gains
Adecco's market share gains indicate strong competitive positioning and ability to capture demand, supporting long-term revenue growth.
Strong U.S. Performance
The significant revenue growth in the U.S. market reflects successful strategic initiatives, enhancing Adecco's global revenue base.
Cash Flow and Operating Leverage
Robust cash flow and improved operating leverage demonstrate effective financial management, supporting future investments and stability.
Negative Factors
Challenges in Akkodis Germany
Revenue decline in Akkodis Germany highlights regional market challenges, potentially affecting overall growth and profitability.
Perm Placement Revenue Decline
Declining permanent placement revenues suggest market hesitancy, impacting Adecco's ability to capitalize on long-term staffing trends.
Logistics Sector Challenges
Challenges in the logistics sector could limit growth opportunities in key European markets, affecting overall revenue potential.
Adecco Group AG (ADEN) vs. iShares MSCI Switzerland ETF (EWL)
Market Cap
CHF3.79B
Dividend Yield4.46%
Average Volume (3M)842.19K
Price to Earnings (P/E)13.8
Beta (1Y)0.96
Revenue Growth-4.68%
EPS Growth-5.79%
CountryCH
Employees33,597
SectorIndustrials
Sector Strength72
IndustryStaffing & Employment Services
Share Statistics
EPS (TTM)0.61
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
CHF26.57Price Target Upside17.46% Upside
Rating ConsensusHold
Number of Analyst Covering7
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 generates revenue primarily through its staffing and recruitment services. The company earns money by charging clients a fee for placing temporary and permanent employees, which typically consists of a markup on the employee's salary or an upfront fee for permanent placements. Additionally, Adecco offers managed services provider (MSP) solutions and recruitment process outsourcing (RPO), which further diversify its revenue streams. Key partnerships with various organizations, technology firms, and industry associations help enhance its service offerings and expand its market reach, contributing significantly to its earnings. The company's ability to adapt to market trends, such as digital transformation and the gig economy, also plays a crucial role in sustaining its revenue growth.
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 presents a stable financial position with areas for improvement. The income statement reflects challenges in profitability and revenue growth, while the balance sheet shows a balanced leverage approach. Cash flow metrics are strong, highlighting effective cash management. The company should focus on enhancing profitability and operational efficiency to improve its financial standing.Income Statement
Adecco Group AG shows a mixed performance in its income statement. The company has a modest gross profit margin and a low net profit margin, indicating limited profitability. Revenue growth has been inconsistent, with a recent decline in annual revenue but a positive TTM growth rate. EBIT and EBITDA margins are relatively low, suggesting room for operational efficiency improvements.65
Positive
Balance Sheet
The balance sheet reveals a moderate debt-to-equity ratio, indicating a balanced approach to leveraging. Return on equity is modest, reflecting average profitability relative to shareholder equity. The equity ratio is stable, suggesting a solid asset base, but there is potential risk due to the level of debt.60
Neutral
Cash Flow
Cash flow analysis shows a positive trend with a significant increase in free cash flow growth in the TTM period. The operating cash flow to net income ratio is healthy, indicating strong cash generation relative to net income. The free cash flow to net income ratio is robust, suggesting efficient cash management.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 23.00B | 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 | 708.00M | 760.00M | 841.00M | 770.00M | 971.00M | 307.00M |
| Net Income | 280.00M | 303.00M | 325.00M | 342.00M | 586.00M | -97.00M |
Balance Sheet | ||||||
| Total Assets | 11.79B | 12.10B | 12.43B | 13.26B | 11.87B | 9.79B |
| Cash, Cash Equivalents and Short-Term Investments | 342.00M | 482.00M | 556.00M | 782.00M | 3.05B | 1.49B |
| Total Debt | 3.54B | 3.48B | 3.67B | 3.70B | 3.48B | 2.29B |
| Total Liabilities | 8.49B | 8.51B | 8.83B | 9.36B | 8.06B | 6.57B |
| Stockholders Equity | 3.29B | 3.58B | 3.60B | 3.88B | 3.79B | 3.21B |
Cash Flow | ||||||
| Free Cash Flow | 503.00M | 563.00M | 347.00M | 328.00M | 590.00M | 563.00M |
| Operating Cash Flow | 628.00M | 707.00M | 563.00M | 543.00M | 722.00M | 720.00M |
| Investing Cash Flow | -149.00M | -157.00M | -209.00M | -1.45B | -206.00M | -162.00M |
| Financing Cash Flow | -352.00M | -634.00M | -620.00M | -1.38B | 980.00M | -290.00M |
Adecco Group AG Technical Analysis
Neutral
22.62
Price Trends
22.83
Negative
22.91
Negative
23.47
Negative
Market Momentum
-0.23
Positive
49.94
Neutral
34.53
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:ADEN, the sentiment is Neutral. The current price of 22.62 is below the 20-day moving average (MA) of 22.85, below the 50-day MA of 22.83, and below the 200-day MA of 23.47, indicating a bearish trend. The MACD of -0.23 indicates Positive momentum. The RSI at 49.94 is Neutral, neither overbought nor oversold. The STOCH value of 34.53 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CH:ADEN.
Adecco Group AG Peers Comparison
UnderperformOutperform
Sector (63)
CH:ADEN
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22.62
1.82
8.75%
CH:KNIN
Kuehne + Nagel International AG
178.70
-15.38
-7.92%
CH:SGSN
SGS SA
92.80
8.47
10.04%
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.