Interactive Investor

ii view: Hays benefits from buoyant hire market

15th October 2021 14:22

Keith Bowman from interactive investor


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Twelve countries made record fees and the shares sit on an estimated dividend yield of over 4%. Buy, sell or hold?

First-quarter trading update to 30 September

  • Like-for-like net fees up 41% year-on-year

Chief executive Alistair Cox said:

"We have made a strong start to our financial year, with sequential fee growth in all major markets. 12 countries produced record net fees, and our global Hays Technology business also hit record fees.”

ii round-up:

Hays (LSE:HAS) is a UK and overseas recruitment company. It employs over 10,500 staff in 256 offices across 33 countries. 

It recruits across 20 specialisms with IT its biggest at around a quarter of fees, followed by accountancy and finance and then construction and property. 

Competitors include PageGroup (LSE:PAGE) and Robert Walters (LSE:RWA)

For a round-up of this latest trading update, please click here

ii view:

Temporary and permanent fees are split in roughly 60:40 depending on the economic cycle. Hays' overseas business now accounts for almost 80% of income, up from around a quarter in 2005. Germany provides its biggest single country market at around 26% of net fees, followed by the UK at 23%, Australia & New Zealand at 17%, and Rest of the World (including the US and China) at 34%. Fees are split roughly 84% from the private sector and 16% from the public sector.  

For investors, pandemic uncertainty and further lockdowns for its Australia and New Zealand businesses need to be remembered. So does a slower recovery for its temporary hires with fees still down 7% compared to pre-pandemic levels. An estimated forward price/earnings (PE) ratio above the 10-year average also suggests the shares are not obviously cheap, while currency movements can offer headwinds. 

But Hays continues to benefit from the post pandemic economic recovery, and record fee performances were reported in the USA, China and Malaysia over this latest quarter. Less company outsourcing of recruitment persists in many international markets, offering room for growth, while a forecast dividend yield of over 4% looks attractive in the current low interest rate environment. In all, and with demand for skilled labour likely to persist, Hays appears well positioned to take advantage. 


  • Business sector and geographical diversity
  • Previously recommenced dividend payments


  • Covid clouded outlook
  • Currency movements can hinder performance

The average rating of stock market analysts:


These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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