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Sep
2
Jonathan Yates
Profit from the Workforce Industry on Labor Day
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Changes in the way the employers hire now create opportunities for investors in the demand labor industry.  Companies such as Paychex (NASDAQ: PAYX), Robert Half International (NYSE: RHI), Labor SMART (OTCBB: LTNC), and ManpowerGroup (NYSE: MAN) are expanding, which is rewarding investors.  Based on the evolution of the American economy in the post-Great Recession, these stocks should prove to be profitable long term investments.

Articles in major publications such as The Washington Post, Detroit Press, and others have detailed how there are more part-time workers in the American workforce.  That is a result of many factors.  New programs like Obamacare make it much more expensive to hire full-time workers. Employers do not want to take the risk of hiring full-time workers as the expenses will reduce profits.

That makes investing in workforce stocks more profitable, which can be seen in the stock performance of companies in the sector.

For 2013, Paychex has risen more than 25%.  Over that same period, ManpowerGroup is up more than 50%.  The stock price for Robert Half International is up more than 35% for the last year of market action.

That is obviously due to the growth in the industry.

Labor SMART has seen its revenues grow from under $1 million in 2011 to a projected $18 million this year, as an example.   It just acquired Qwik Staffing Solutions to penetrate the lucrative Florida market.  The number of branches for Labor SMART has also soared as it moves towards a nationwide presence.

Growth, value, and income investors can all find a stock in the staffing solutions industry.

The growth of Labor SMART is obvious.  ManpowerGroup is undervalued with a price-to-sales ratio of just 0.25.  The dividend yield for Paychex is 3.62%, well above the average of about 2% for a member of the Standard & Poor’s 500 Index (NYSE: SPY).  The growth rate for dividends for Paychex and others in the industry is impressive, too.

 



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