瑞信-全球-商业服务业-商业服务：科技还是触屏-2019.2.6-50页.pdf

Research Analysts Business ServicesBusiness Services Tech or Touch Tech or Touch 6 February 2019 Andy Grobler Andy.groblercredit- Tel:0207 883 5943 DISCLOSURE APPENDIX AT THE BACK OF THIS REPORT CONTAINS IMPORTANT DISCLOSURES,ANALYST CERTIFICATIONS,LEGAL ENTITY DISCLOSURE AND THE STATUS OF NON-US ANALYSTS.US Disclosure:Credit Suisse does and seeks to do business with companies covered in its research reports.As a result,investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report.Investors should consider this report as only a single factor in making their investment decision.Daniel Hobden Daniel.hobdencredit- Tel:0207 883 3290 Karl Green karl.greencredit- Tel:0207 888 2629 每日免费获取报告1、每日微信群内分享7+最新重磅报告；2、每日分享当日华尔街日报、金融时报；3、每周分享经济学人4、行研报告均为公开版，权利归原作者所有，起点财经仅分发做内部学习。扫一扫二维码关注公号回复：研究报告加入“起点财经”微信群。Why Credit Suisse Research?High impact research that spans across asset classes,sectors,and regions Produced by:Slide 2 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services Why Credit Suisse Analytics?Access to innovative tools,models,and capabilities at your fingertips Produced by:Slide 3 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services 4 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services 1)Staffing Cyclical and structural concerns We expect organic growth to slow across the group with Generalists facing negative growth in the near term.Professionals are better placed for 2019 but slowing growth will limit operational leverage in the absence of self help.Structural challenges,especially in US and UK will,we think,stymie growth,margin and return for the agencies.O/P rated stocks:Page-self help;Robert Walters-Geography and RPO.U/P rated:Adecco-cyclical headwinds;Staffline margin concerns and contractor availability Key Views by sub-sector Part 1 Prices as of 1st Feb 2019 2)Testing Slowing growth and trade worries We expect organic growth to slow through H119 for SGS and BVI given tough comps and slowing Chinese consumer demand.We forecast margin progress across the sub-sector but limited expansion for Intertek given consumer headwinds and dilutive M&A.O/P rated stocks:BVI-multiple mean reversion and Applus-improving O&G,rating and lack of direct trade exposure.U/P rated:ITRK-valuation,Chinese consumer exposure,limited margin progression.3)Distribution More touch than tech We see limited(but not zero)disruption from technology in the near term given the sophisticated service models of these companies.O/P rated stocks:Bunzl-stable growth,Brenntag-multiple mean reversion,stable growth and relatively undisrupted.U/P rated:DKSH-expensive growth with near and long term pressure on returns,in our view.NameRatingFXCurrentPTMkt Cap US$AdeccoU/PCHF50.140.08,390RandstadNEUR43.041.09,036HaysNGBP1551702,951PageGroupO/PGBP4485751,923SThreeNGBP280320467Robert WaltersO/PGBP526700520StafflineU/PGBP670950245NameRatingFXCurrentPTMkt Cap US$Bureau VeritasO/PEUR19.524.09,872IntertekU/PGBP4,8784,60010,300ApplusO/PEUR9.814.21,611SGSNCHF2,4062,40018,450NameRatingFXCurrentPTMkt Cap US$ElectrocomponentsNGBP542.86503,152BunzlO/PGBP2,4342,60010,714DKSHU/PCHF74.665.04,874LogistaNEUR22.221.03,382BrenntagO/PEUR41.952.07,408FergusonNGBP5,1635,73515,669Source:Credit Suisse estimates,Thomson Reuters DataStream 5 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services Key Views by sub-sector Part 2 4)Security attractive despite some challenges Security continues to offer contradictions.On one hand it is a relatively stable,growing(on the whole)business with opportunities to benefit from combining technology with human touch.On the other hand progress can be patchy,technology is cannibalising demand in segments of the markets,tight labour markets are proving challenging and product differentiation is the exception rather than the rule:O/P rated:Securitas attractively valued growth,track record of managing cost and momentum in its tech offering.GFS mean reversion despite slower than expected growth in 2018 with potential to generate value through review of Cash Solutions.5)Rental Cycle and leases Ashtead(O/P)is an attractive combination of operational and financial leverage.In periods of cyclical weakness this is a major headwind but for now valuation attractive and markets solid.IWGs(U/P)market will,we think,grow structurally in the coming years with opportunities from the franchise model.However,we think rapid supply growth leaves the industry vulnerable to price pressure in the event of cyclical weakness with incremental pressure on EPS from the adoption of IFRS16.6)Others Diversity across a broad range of stocks In the diverse remainder of our coverage we prefer:Experian sustainable growth driven by innovation&investment into a series of new markets.Rentokil stable growth,low cyclicality and margin opportunities in US.Elis not without near term challenges but attractively valued for the medium term;ISS growth to accelerate with stable margins/returns.Our least preferred are AA high leverage,UK exposure and potential regulatory headwinds;Serco recovery in the price but threatened by UK political indigestion.Prices as of 1st Feb 2019 NameRatingFXCurrentPTMkt Cap US$G4SO/PGBP2022504,101SecuritasO/PSKr1461705,608NameRatingFXCurrentPTMkt Cap US$IWGU/PGBP224.42002,626AggrekoNGBP705.28002,279Ashtead GroupO/PGBP1,967.02,67512,232NameRatingFXCurrentPTMkt Cap US$ExperianO/PGBP1,954.52,10023,271CapitaNGBP116.91402,551SercoU/PGBP112.5861,617BabcockNGBP535.26403,540RentokilO/PGBP340.44008,209ElisO/PEUR14.0183,534ISSO/PDKK188.52005,371TeleperformanceNEUR152.916510,119EquinitiNGBP209.0245997AAU/PGBP85.070682Source:Credit Suisse estimates,Thomson Reuters DataStream 6 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services Top Picks Outperform Experian:Quality Growth-Sustainable high single digit growth,supported by expansion in substantial New Markets.Strong FCF generation re-cycled into M&A,buybacks and dividends.Brenntag:Attractively valued stable growth Trading close to all time relative PE lows despite relatively stable growth through cycle given its fee per order structure.Counter cyclical working capital support through cycle FCF generation that can fund on-going consolidation of the market.G4S:Self help and portfolio restructuring.Potential value release via review of the Cash Solutions division.Internal efficiency programs to support margins despite challenges from rising wages combined with stable through cycle growth.Trading close to relative PE lows.Underperform Intertek:High multiple growth with near term challenges.Limited margin progress through 2018&2019 due to dilutive acquisitions and pressure on segments of Product division.Consumer operations(c15%2018E EBITA)vulnerable to continued Chinese/US trade tensions Relative PE risen above historic relationship with organic growth.Highest CY19E PE within sector coverage.AA:Levered business facing strong competition and potential regulatory tension.High financial leverage.100%focused on the UK.Aggressive price competition in its roadside operations.Potential regulatory investigation(CMA)into pricing methodology and loyalty discount.CY19E EV/EBITDA at premium to sector coverage.7 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services Coverage and ratings Price as of 1sT Feb 2019 CompanyRatingFXTPPDaily trad.Mkt Cap value$mUS$m2018E2019E2018E2019E2018E2019E2018E2019E2018E2019E2018E2019E2018E2019EStaffingAdeccoU/PCHF40.050.166.58,39010.210.27.77.28.37.811.611.97.0%7.3%5.1%5.2%1.21.0RandstadNEUR41.043.036.69,0369.810.27.67.48.28.111.011.28.6%10.4%7.6%8.8%1.00.9HaysNGBP170.0154.88.42,95113.012.27.87.38.47.812.111.25.0%6.5%6.0%6.6%-0.5-0.5PageGroupO/PGBP575.0447.66.41,92314.112.68.57.79.78.513.512.05.6%6.9%5.8%5.9%-0.6-0.6SThreeNGBP320.0279.50.74679.08.26.15.56.86.19.48.46.8%7.6%5.2%5.3%0.20.2Robert WaltersO/PGBP700.0526.00.552010.99.96.16.26.86.89.39.35.3%0.3%2.8%3.0%-1.3-0.6StafflineU/PGBP9506701.42455.95.45.04.25.54.66.85.711.8%NA4.1%4.4%0.60.1Average(Ex Staffline)3,88111.210.67.36.98.07.511.110.66.4%6.5%5.4%5.8%0.00.1Outsourcing/FMCapitaNGBP14011718.42,5518.29.36.06.17.77.89.49.6-2.1%-4.9%0.0%0.0%1.31.5SercoU/PGBP86.0112.53.71,61723.322.110.39.814.913.921.819.91.1%0.3%0.0%1.5%1.51.4BabcockNGBP64053523.13,5406.36.35.35.16.25.97.57.28.7%10.7%5.7%5.9%1.51.2RentokilO/PGBP400.0340.420.98,20926.922.415.413.322.519.029.024.55.0%4.1%1.3%1.4%2.31.9ElisO/PEUR18.214.010.03,53412.411.66.56.114.713.320.618.36.1%8.6%2.9%3.0%3.43.1ISSO/PDKK200.0188.518.05,37116.914.111.29.712.811.0-93.815.66.1%5.8%4.1%5.0%2.82.1TeleperformanceNEUR165.0152.921.510,11923.219.114.211.418.815.126.020.65.8%4.9%1.3%1.5%2.61.8EquinitiNGBP245.0209.04.299712.311.58.87.79.28.111.410.06.6%8.0%2.5%2.7%2.52.0AAU/PGBP70.085.09.66825.65.610.29.713.013.216.116.417.1%14.4%2.6%2.4%8.68.2Average 4,06915.013.59.88.813.311.95.315.86.0%5.8%2.3%2.6%2.92.6SecurityG4SO/PGBP250.0202.018.04,10111.811.19.18.811.310.914.714.16.3%2.9%4.8%4.8%3.73.6SecuritasO/PSKr170.0146.122.55,60814.813.410.19.313.211.917.716.06.4%5.1%2.9%3.3%2.72.4Average4,85413.312.29.69.112.211.416.215.06.3%4.0%3.9%4.0%3.23.0TestingBureau VeritasO/PEUR24.019.517.79,87220.318.812.711.814.813.722.320.74.3%4.5%3.0%3.1%2.82.5IntertekU/PGBP4,6004,87827.110,30024.422.415.113.518.316.524.421.94.1%3.8%2.0%2.2%1.61.2ApplusO/PEUR149.82.81,61114.613.09.28.111.710.415.513.76.0%6.5%1.4%1.5%2.62.1SGSNCHF2,4002,40650.618,45025.324.414.513.618.517.724.423.73.9%3.2%3.2%3.3%0.80.8Average10,05821.219.612.911.815.814.621.620.04.6%4.5%2.4%2.5%2.01.7DistributionElectrocomponentsNGBP65054310.43,15216.113.811.29.812.811.016.214.45.3%4.7%2.6%3.0%1.00.8BunzlO/PGBP2,6002,43433.110,71419.218.415.014.115.914.923.221.36.2%5.0%2.1%2.2%2.31.9DKSHU/PCHF65.074.67.24,87423.922.213.712.815.414.421.219.83.7%3.4%3.6%2.3%-0.8-0.7LogistaNEUR21.022.23.93,38214.714.49.89.811.110.714.514.29.0%9.7%5.1%5.2%-0.2-0.2BrenntagO/PEUR52.041.917.77,40813.812.79.68.811.310.315.614.54.8%7.2%2.8%2.9%2.21.8FergusonNGBP5,7355,16352.815,66914.212.68.47.89.48.713.011.65.9%6.1%2.9%3.2%-0.7-0.7Average7,53317.015.711.310.512.611.717.316.06.0%5.7%3.2%3.1%0.60.5RentalIWGU/PGBP200.0224.412.92,62617.014.66.35.815.113.818.917.31.4%-1.6%2.6%2.7%1.21.3AggrekoNGBP8007059.62,27914.012.34.53.910.99.115.613.212.2%14.6%3.8%4.0%1.20.8Ashtead GroupO/PGBP2,6751,96752.712,23212.810.56.45.910.79.714.913.04.9%4.3%2.0%2.5%1.61.6Average5,71314.612.55.75.212.210.916.514.56.2%5.7%2.8%3.1%1.31.2CreditExperianO/PGBP2,1001,95549.523,27126.223.716.415.220.719.226.825.65.2%4.2%1.9%2.0%2.12.0Sector Average6,11615.314.09.78.912.311.213.115.26.1%5.6%3.2%3.5%1.61.4FCF yld to EqDividend YieldND/EBITDAPEEV/EBITDAEV/EBITAEV/NOPATSource:Credit Suisse estimates,Thomson Reuters DataStream 8 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services Differentiation Data driven insights 2)Testing lead indicator Thematic work Accounting and Remuneration Bottom up analysis 1)Staffing lead indicator HOLT analysis Source:Credit Suisse Research.Credit Suisse estimates,Company data 9 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services Business services by style&CS HOLT CompanyOverallOperational Quality RankMomentum RankValuation RankInvestment StyleStaffing84874781STHR99858494Best In ClassSTAF96967189Best In ClassPAGE92945778Style NeutralHAYS92912889ContrarianADEN70891174ContrarianRAND5679772ContrarianRWA84737271Best In ClassTesting38764119ITRK66837327Quality At Any PriceBVI20722010Quality TrapAPPLUS39695916Style NeutralSGSN26801323Quality TrapSecurity 57864234GFS50961141Style NeutralSECUb63767226Quality At Any PriceCredit2782316EXPN2782316Quality TrapDistribution 73676650FERG90635085Style NeutralECM68715654Style NeutralBNZL82759131Quality At Any PriceDKSH51606528Quality At Any PriceBNRGn29571646Style NeutralRental72646076AHT100938797Best In ClassAGGK59385770Style NeutralIWG58623762ContrarianOther45664732BAB70692283ContrarianEQN82857948Style NeutralRTO5368885Quality At Any PriceISS5299640Style NeutralAAAA37942816Quality TrapROCH43576623Style NeutralCPI2591188Quality TrapELIS24291864Value TrapSRP164960Momentum TrapHOLT scorecard 2019 PE and style Source,Credit Suisse estimates,Credit Suisse Research,Credit Suisse HOLT 10 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services Macro Momentum Macro momentum weakened through H218,particularly in Europe,compounded by headwinds in Auto and slowing Chinese growth.CS forecasts improved growth through H219.However,warning signs are beginning to build for a more concerted slowdown during 2020.Key exposures:Staffing,IWG,Ashtead,Ferguson Wage Growth Wage growth is accelerating in the US,albeit not universally,with pressure also building in Europe and Asia.Tighter labour markets also impacting employee retention across a number of industries.Staffing is a net beneficiary of rising wages.Security,FM,rental and distribution margins will be dependent on the ability to pass on wage growth via pricing and to manage the costs of staff churn.Beneficiaries:Staffing Manageable:Rentokil,ISS At risk:Distribution,Ashtead,Security(albeit Securitas has strong track record in US),Elis US/China trade disputes Planned tariff increases due in March will impact c40%of Chinese export to the US.In addition they will likely weigh on Chinese economic growth with knock on impact to minerals demand.Intertek expect limited impact on its Consumer(reported within Product division)operations noting the logistical challenges of changing supply chains,while SGS,having seen some impact in Q418,expect uncertainty to impinge on activity through H1.We see exposure of c6%(2018 EBITA)for BVI,c8%SGS and c15%ITRK.Directly impacted.BVI,SGS,ITRK Indirectly impacted:Hays(Australian exposure)Technological disruption Ongoing disruption to a number of business models from technological development.The extent to which technology supports or replaces human interaction.Outcomes are never binary.Net beneficiaries:Security,Credit Net negatively impacted:Staffing(notably generalist),Aggreko,AA Brexit The saga continues.In the event of a no-deal Brexit we would expect sterling weakness,tangible near term impact on UK GDP/confidence and incremental economic weakness in Europe.Net winners:Ashtead,Aggreko,Ferguson,Intertek,Experian,Bunzl,Serco,Rentokil(all FX)Net losers:Staffline(100%UK),Equiniti(UK),Adecco(Europe),Elis(UK and Europe),Capita(UK),Randstad(Europe),AA(100%UK)Key themes for 2019 11 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services Staff costs and UK&European exposure data Staff costs as%of sales 2016/2017 UK&European-revenue exposure 2017 Source:Company data Source:Company data,HAS,BAB,AA,ECM,LOG,FEG,AHT,EXPN show data to FY17 and FY18 12 February 06,2019 CREDIT SUISSE,Eur Eqr Business&Professional Services Long term themes Tech or Touch Technology is impacting every business within the sector and we expect the impact to become more pronounced in the future.The impact,which is never binary,will va