Analyzing Brink’s (NYSE:BCO) and Adecco (OTCMKTS:AHEXY)

Adecco (OTCMKTS:AHEXY) and Brink’s (NYSE:BCO) are both mid-cap business services companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, profitability, analyst recommendations, earnings, dividends and risk.

Institutional and Insider Ownership

95.0% of Brink’s shares are owned by institutional investors. 0.7% of Brink’s shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Adecco has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500. Comparatively, Brink’s has a beta of 1.48, meaning that its stock price is 48% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and price targets for Adecco and Brink’s, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Adecco	1	1	2	2	2.83
Brink’s	0	0	1	0	3.00

Brink’s has a consensus target price of $138.00, indicating a potential upside of 23.24%. Given Brink’s’ stronger consensus rating and higher probable upside, analysts plainly believe Brink’s is more favorable than Adecco.

Profitability

This table compares Adecco and Brink’s’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Adecco	1.26%	10.94%	3.13%
Brink’s	3.21%	86.86%	4.62%

Dividends

Adecco pays an annual dividend of $0.32 per share and has a dividend yield of 2.0%. Brink’s pays an annual dividend of $1.02 per share and has a dividend yield of 0.9%. Adecco pays out 34.0% of its earnings in the form of a dividend. Brink’s pays out 27.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Brink’s has raised its dividend for 5 consecutive years.

Earnings and Valuation

This table compares Adecco and Brink’s”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Adecco	$25.04 billion	0.21	$327.88 million	$0.94	16.95
Brink’s	$5.01 billion	0.93	$162.90 million	$3.70	30.26

Adecco has higher revenue and earnings than Brink’s. Adecco is trading at a lower price-to-earnings ratio than Brink’s, indicating that it is currently the more affordable of the two stocks.

Summary

Brink’s beats Adecco on 13 of the 18 factors compared between the two stocks.

About Adecco

Adecco Group AG, together with its subsidiaries, provides human resource services to businesses and organizations in Europe, North America, Asia Pacific, South America, and North Africa. It offers flexible placement, permanent placement, outsourcing, training, upskilling and reskilling, career transition and workforce transformation, consulting, talent academy, digital staffing solutions under the Adecco, Akkodis, General Assembly, Badenoch + Clark, Lee Hecht Harrison, pontoon, Spring Professional, Adia, Modis, and YOSS brand names. The company also operates Hired, a talent recruitment platform. The company was formerly known as Adecco S.A. Adecco Group AG was founded in 1957 and is based in Zurich, Switzerland.

About Brink’s

The Brink’s Co. engages in providing cash management services, digital retail solutions, and ATM managed services. It operates through the following geographical segments: North America, Latin America, Europe, and Rest of World. The North America segment operates in the U.S. and Canada. The Latin America segment refers to the operations in Latin American countries. The Europe segment relates to operations in European countries. The Rest of World segment focuses on the operations in the Middle East, Africa, and Asia. The company was founded by Perry Brink and Fidelia Brink on May 5, 1859 and is headquartered in Richmond, VA.