Hays (AO) | Hold | Hays appoints Mark Dearnley as CEO

Research evidence excerpt

Hays (AO) | Hold | Hays appoints Mark Dearnley as CEO

Hays Hold | Target Price: 51p

Company description Management

Hays is a leading global recruitment and temporary staffing firm for the Andrew Martin, Chairman

professional segment, active in c. 30 countries across five continents. Temporary Dirk Hahn, CEO

staffing accounts for c. 60% of net fees and recruitment services for 40%. James Hilton, CFO

Engineering, Accounting & Finance, Construction & Property and Technology are Key shareholders

the main sectors that it caters to. Germany is the largest country of operation Free float 92.00%

with 32% of net fees, followed by the UK & Ireland (20%) and Australia & New Silchester 17.84%

Zealand (13%). FIL 6.73% Vanguard 6.34%

Investment case Valuation methodology

We continue to expect net fee growth to remain negative in H1 Our price target is based on the rounded average of a DCF

2026, as candidate confidence remains subdued and corporates valuation based on WACC of 9.7%, terminal growth of +1% and

continue to delay hiring decisions. While management is likely terminal adj.EBITA margin of 2.0% and an EV/EBIT target

to implement further cost reduction measures to enhance multiple of 9.4x NTM EBIT, below historical average to reflect the

operational leverage, we do not believe this will be sufficient to uncertain staffing environment.

trigger a re-rating of the shares in the near term. Risks to our rating

Although fiscal expansion in Germany may provide some Deteriorating macroeconomic data and prolonged weakness in

support, we do not expect a notable recovery in labour market global staffing markets.

dynamics before mid-2026. For now, the valuation remains Loss of market share and margin pressure from competitors.

undemanding.

Catalysts