ManpowerGroup (MAN): AI Identifies Bearish Options Play

ManpowerGroup is a global leader in workforce solutions, connecting millions of people to work annually. The company operates through its distinct brands: 'Manpower' for contingent staffing and permanent recruitment, 'Experis' for IT professional resourcing and project services, and 'Talent Solutions' which combines RPO, MSP, and Right Management. ManpowerGroup serves global, multinational, and local clients across major industry segments, offering services like recruitment, assessment, upskilling, career management, outsourcing, and workforce consulting. ManpowerGroup differentiates itself by providing a comprehensive suite of services from talent attraction and acquisition to development and retention, leveraging its integrated HR tech stack 'PowerSuite' to deliver data-driven workforce solutions at scale.

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MAN's technical outlook is decidedly bearish. The stock price has experienced a significant decline over the past 90 days, plummeting from approximately $44.46 in late July to $29.92 as of November 4th. This downtrend is confirmed by the price being significantly below its 50-day SMA (37.43) and 200-day SMA (45.12). Momentum indicators reveal considerable weakness; the RSI_14 is at an extremely oversold level of 24.25, suggesting the price may be due for a short-term bounce, but also indicating sustained selling pressure. The MACD at -2.13 is well below its signal line, further reinforcing the bearish trend. The stochastic oscillator (STOCHk_14_3_3) at 6.23 is also signaling oversold conditions, but this is not enough to counter the overwhelmingly negative signals. The ADX_14 at 34.30 indicates a strong trend, which in this case, is downwards. Given these signals, the outlook for MAN over the next 1-3 months remains bearish, with potential for further declines before any sustained recovery.

ManpowerGroup's MD&A indicates a challenging business environment. For the three months ended September 30, 2025, `Revenues from services` increased by 2.3% to $4,634.4 million, but decreased by -1.5% in constant currency. The `Gross profit` margin decreased from 17.3% to 16.6%. For the nine months ended September 30, 2025, the company's performance weakened further, with `Revenues from services` decreasing by -1.6% to $13,244.0 million (-3.2% in constant currency), and a `Gross profit` margin decrease from 17.3% to 16.8%. Critically, `Cash used in operating activities` was $283.0 million for the first nine months of 2025, a significant downturn compared to the $61.6 million provided in the same period of 2024. Management notes 'employers are proving resilient but remain cautious in their workforce strategies', reflecting macroeconomic and geopolitical uncertainties. The company also recognized goodwill impairment losses of $33.4 million for the United Kingdom reporting unit and $24.7 million for the Switzerland reporting unit during the second quarter of 2025. The outlook suggests continued caution among employers, indicating a mixed business environment.

ManpowerGroup's Q2 2025 earnings call presents a cautiously optimistic outlook. While reported revenue declined 3% year-over-year in constant currency, management highlighted 'encouraging signs of stabilization' in the U.S. and parts of Europe, with a return to revenue growth in the Manpower and Talent Solutions brands. Adjusted EPS of $0.78 beat the guidance midpoint by $0.08. Looking ahead, Q3 2025 EPS is guided to $0.77 to $0.87, with constant currency revenue expected to decrease between flat and 4%, translating to a flat organic days adjusted revenue trend at the midpoint. The company is focusing on profitable growth, with CEO Jonas Prising noting that the company is 'staying closely connected to our clients, anticipating their evolving needs.' The diversity of the vertical mix is proving a strength. While Northern Europe continues to face headwinds, actions are being taken to rightsize the business. The company is investing in AI and digital transformation, with 90% of revenues running through the PowerSuite front office platform. Overall, the tone suggests a potential turning point, but the outlook remains contingent on macroeconomic stability.

MAN's financial performance presents a mixed picture. Revenue has generally increased, with Q1 2024 reporting $4,403.3M and Q3 2025 reaching $4,634.4M, although there's some fluctuation in between. The gross profit ratio has remained relatively stable, hovering around 17%, with a slight dip to 16.76% in the most recent quarter. Operating cash flow has been volatile, swinging from $116M in Q1 2024 to -$137.9M in Q2 2024, before recovering to $59.8M in Q3 2025; this inconsistency is a concern. Total debt has increased from $1,398.6M in Q1 2024 to $1,637.1M in Q3 2025, indicating increased leverage. While revenue is growing, the inconsistency in operating cash flow and increasing debt suggest potential challenges in the near term. The net income experienced a significant drop to -$67.1M in Q2 2025, but recovered to $18M in Q3 2025. Overall, the company exhibits moderate growth but requires careful monitoring of cash flow and debt management.

The company demonstrates a moderately bullish profile, characterized by solid revenue growth and improving profitability. Revenue has consistently increased, indicating strong market demand. The gross margin exhibits stability, suggesting efficient cost management. Return on Equity (ROE) has shown positive movement, signaling enhanced profitability and efficient use of shareholder equity. The Price-to-Earnings (P/E) ratio, while elevated, might be justifiable given the growth trajectory and positive ROE trend. The Debt-to-Equity ratio shows a slight increase, which warrants monitoring, but is counterbalanced by a healthy Current Ratio, implying sufficient liquidity to meet short-term obligations. Overall, the company presents a favorable picture with growth and profitability, though the leverage should be watched closely. The combination of growth and profitability suggests potential for continued positive performance over the next 12 months.