Deutsche Bank upgrades European Staffing as industry looks up

Deutsche Bank has upgraded the European staffing sector to ‘hold’ from ‘sell’ due to a lack of negative catalysts in the industry.

Hays and Pagegroup were among its top picks in the sector. Hays had its price target raised to 160p from 120p and Pagegroup was upped to 400p from 300p.

“Recent macro data has been better than expected, and the outlook for staffing markets in major economies has shown some improvement. We continue to be very concerned over a late cycle US economy and note that all US indicators are elevated. However, without the prospect of a near term decline in growth, the stocks are unlikely to sell off.”

The bank no longer forecasts a material decline in 2017 and instead forecast a small improvement in organic growth, leading to a rise in its earnings estimates for 2018 ranging from 20% to 60%.

The share price of Hays rose 0.06% and Pagegroup was up 1.87% at 1011 GMT on Thursday.