STOCKS NEWS EUROPE-Hays rises even as fees slump
Shares in the UK's biggest listed recruitment firm, Hays HASYS.L, rise 4 percent, despite the company reporting that fees in the three months to June were 40 percent down on a year earlier.
Charles Stanley retains its "add" rating on the company, commenting: "The group continues to benefit from a strong balance sheet and attractive dividend, giving a yield of about 7 percent, which in our view is sustainable."
The broker adds that Hays trades at a P/E ratio of 14.5 times forecast 2010 earnings, a 71 percent discount to Michael Page (MPI.L).
It also trades at ratio of 0.54x on an enterprise value/sales basis, a 42 percent discount to Michael Page. "In our view, this is unjustified given its more defensive characteristics, potential to outperform during a sluggish recovery and attractive dividend," says the broker.
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