Morgan Stanley analyst Anvesh Agrawal downgraded Adecco to Underweight from Equal Weight with a price target of CHF 30.10, down from CHF 33.10. The recent rebound in staffing stocks has left the sector "vulnerable" to downside risks, Agrawal tells investors in a research note. Staffing stocks have rallied this quarter, with organic growth and market data "surprisingly resilient," but leading indicators point to a slowdown in volumes, which should lead to "stagnation" in pricing, contends the analyst. Agrawal says Adecco’s risk/reward is most exposed to a bear case scenario.
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