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Why You Should Consider CRA International Over ManpowerGroup
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Companies in the Business Services sector provide consulting, staffing, financial traction, outsourcing, advertising, waste removal, building maintenance, technology services and auction/valuation services.
The sector is trading at a PEG of 1.81x compared with the S&P 500’s PEG of 1.95x. This indicates that the sector is currently undervalued and has tremendous growth potential.
The sector has seen a steady positive earnings growth trend through 2016 which is expected to continue this year as well. The sector has a historical earnings per share growth rate of 8.8%.
Let’s find out how these two Business Services stocks are faring at present:
Founded in 1965 and headquartered in Boston, MA, CRA International, Inc. (CRAI - Free Report) , formerly known as Charles River Associates, provides legal, regulatory, business consulting and other expert services through its specialized consultants across the globe. The company’s economists, business professionals, engineers and other industry leaders provide original authoritative advice to support various customer activities.
The company currently has a P/S ratio of about 0.81. This is relatively lower than the industry average of 1.24. In addition, CRA International has a P/B ratio of 1.40, which is also below the industry average of 2.82. This has helped the stock secure a Value Score of B. The valuation metrics show that CRA International is undervalued.
The company has a projected earnings growth rate of 14.29%, higher than the industry’s estimated growth of 9.11%. The financial health and growth prospects of CRA International demonstrate its potential to outperform the market. It currently has a Growth Score of A. Recent price changes and earnings estimate revisions justify the company’s Momentum Score of C. The company has a VGM Score of A, which makes it a compelling pick for investors. The company is among the bottom 7% of the industry.
CRA International outperformed the industry in the last three months with an average gain of 8.2% compared with 4% rally for the latter. The company has a more robust service offering than a year ago and an excellent professional team to deliver upon it. The key areas of focus for the company are – generating balanced and profitable growth across the organization through balanced organic and inorganic means, strengthening client relationships within two lines of business and simplifying internal processes.
CRA International currently sports a Zacks Rank #1 (Strong Buy).
Founded in 1948 and headquartered in Milwaukee, WI, ManpowerGroup Inc. (MAN - Free Report) is the global leader in the employment services industry and has a well-established network of 2,900 offices in 80 countries. The company was formerly known as Manpower Inc. and changed its name in March 2011. The company offers its services to approximately 400,000 clients, including small and medium sized enterprises across all industry sectors as well as the world's largest multinational corporations.
The company currently has a P/S ratio of about 0.35. This is relatively lower than the industry average of 0.49. In addition, ManpowerGroup has a P/B ratio of 2.80, which is slightly higher the industry average of 2.20. However, despite P/B being slightly overvalued, the stock has a Value Score of A. The valuation metrics for ManpowerGroup is mixed as we can see from the above-mentioned figures.
The company has a projected earnings growth rate of 8.51%, lower than the industry’s estimated growth of 8.72%. The employment services industry is highly competitive with low barriers to entry and ManpowerGroup faces stiff competition in both domestic and international markets. It currently has a Growth Score of C. Recent price changes and earnings estimate revisions justify the company’s Momentum Score of F. The company has a VGM Score of B, which makes it a compelling pick for investors. The company is among the bottom 10% of the industry.
MapowerGroup has outperformed the industry with an average year-to-date return of 20% compared with a gain of 3% for the latter. ManpowerGroup is continuously making significant investments to expand permanent recruitment solutions offerings. Management continues to believe that global recovery is on track but at a slow and uneven pace.
On analyzing the performance of both these companies, we can clearly say that CRA International is a preferred choice for investors. The company has better VGM metrics and better growth potential in the upcoming quarters. The returns that investors expect are likely to be higher for CRA International than ManpowerGroup.
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Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
But here's something even more remarkable: You can master this proven system without going to a single class or seminar. And then you can apply it to your portfolio in as little as 10 minutes a month.
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Why You Should Consider CRA International Over ManpowerGroup
Companies in the Business Services sector provide consulting, staffing, financial traction, outsourcing, advertising, waste removal, building maintenance, technology services and auction/valuation services.
The sector is trading at a PEG of 1.81x compared with the S&P 500’s PEG of 1.95x. This indicates that the sector is currently undervalued and has tremendous growth potential.
The sector has seen a steady positive earnings growth trend through 2016 which is expected to continue this year as well. The sector has a historical earnings per share growth rate of 8.8%.
Let’s find out how these two Business Services stocks are faring at present:
Founded in 1965 and headquartered in Boston, MA, CRA International, Inc. (CRAI - Free Report) , formerly known as Charles River Associates, provides legal, regulatory, business consulting and other expert services through its specialized consultants across the globe. The company’s economists, business professionals, engineers and other industry leaders provide original authoritative advice to support various customer activities.
The company currently has a P/S ratio of about 0.81. This is relatively lower than the industry average of 1.24. In addition, CRA International has a P/B ratio of 1.40, which is also below the industry average of 2.82. This has helped the stock secure a Value Score of B. The valuation metrics show that CRA International is undervalued.
The company has a projected earnings growth rate of 14.29%, higher than the industry’s estimated growth of 9.11%. The financial health and growth prospects of CRA International demonstrate its potential to outperform the market. It currently has a Growth Score of A. Recent price changes and earnings estimate revisions justify the company’s Momentum Score of C. The company has a VGM Score of A, which makes it a compelling pick for investors. The company is among the bottom 7% of the industry.
CRA International outperformed the industry in the last three months with an average gain of 8.2% compared with 4% rally for the latter. The company has a more robust service offering than a year ago and an excellent professional team to deliver upon it. The key areas of focus for the company are – generating balanced and profitable growth across the organization through balanced organic and inorganic means, strengthening client relationships within two lines of business and simplifying internal processes.
CRA International currently sports a Zacks Rank #1 (Strong Buy).
Founded in 1948 and headquartered in Milwaukee, WI, ManpowerGroup Inc. (MAN - Free Report) is the global leader in the employment services industry and has a well-established network of 2,900 offices in 80 countries. The company was formerly known as Manpower Inc. and changed its name in March 2011. The company offers its services to approximately 400,000 clients, including small and medium sized enterprises across all industry sectors as well as the world's largest multinational corporations.
The company currently has a P/S ratio of about 0.35. This is relatively lower than the industry average of 0.49. In addition, ManpowerGroup has a P/B ratio of 2.80, which is slightly higher the industry average of 2.20. However, despite P/B being slightly overvalued, the stock has a Value Score of A. The valuation metrics for ManpowerGroup is mixed as we can see from the above-mentioned figures.
The company has a projected earnings growth rate of 8.51%, lower than the industry’s estimated growth of 8.72%. The employment services industry is highly competitive with low barriers to entry and ManpowerGroup faces stiff competition in both domestic and international markets. It currently has a Growth Score of C. Recent price changes and earnings estimate revisions justify the company’s Momentum Score of F. The company has a VGM Score of B, which makes it a compelling pick for investors. The company is among the bottom 10% of the industry.
MapowerGroup has outperformed the industry with an average year-to-date return of 20% compared with a gain of 3% for the latter. ManpowerGroup is continuously making significant investments to expand permanent recruitment solutions offerings. Management continues to believe that global recovery is on track but at a slow and uneven pace.
ManpowerGroup also currently flaunts a Zacks Rank #1.You can see the complete list of today’s Zacks #1 Rank stocks here.
Bottom Line
On analyzing the performance of both these companies, we can clearly say that CRA International is a preferred choice for investors. The company has better VGM metrics and better growth potential in the upcoming quarters. The returns that investors expect are likely to be higher for CRA International than ManpowerGroup.
Zacks' 10-Minute Stock-Picking Secret
Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
But here's something even more remarkable: You can master this proven system without going to a single class or seminar. And then you can apply it to your portfolio in as little as 10 minutes a month.
Learn the secret >>