Adecco initiated with an Underweight at Morgan Stanley

Morgan Stanley initiated coverage of Adecco with an Underweight rating and CHF 32 price target. A sluggish recovery due to risk of further deterioration in Europe and less of a pricing tailwind ahead call for caution on the European staffers, the analyst tells investors in a research note. The firm prefers Randstad over Adecco driven by its better profitability and cash return profile, and remains on the sidelines on specialists given exposure to cyclical risks.