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Investing.com - Morgan Stanley downgraded Randstad NV (AS:RAND) stock rating from Equalweight to Underweight on Wednesday, while also lowering its price target to EUR36.00 from EUR38.00.
The investment bank cited concerns about Randstad’s valuation, which it considers demanding at 10.5x EV/EBITA, representing one standard deviation above the company’s historical average.
Morgan Stanley expressed caution about the entire staffing sub-sector but specifically highlighted Randstad’s position relative to competitor Adecco, indicating a preference for the latter.
The downgrade reflects Morgan Stanley’s expectation that momentum between the two companies will continue to diverge in the short term, with Randstad likely underperforming in terms of organic growth and profit conversion.
While the bank sees limited downside to consensus expectations for Randstad over fiscal years 2025 and 2026 in a scenario of gradual recovery, it warned of a risk of relative de-rating versus Adecco .
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