Hays Share Price (HAS) Stuttering, Analyst Initiates Coverage At Hold

Hays share price (LON:HAS) has struggled to catch a bid this year, as the company deals with global hiring slows and analysts expressing caution. The stock is currently trading at 63.05p, down approximately 21.25% YTD, highlighting the impact of recent headwinds on market sentiment.

Kepler Cheuvreux initiated coverage of Hays with a “Hold” rating and a price target of 68p, signaling near-term caution due to persistent softness in the labor market. This new coverage aligns with existing concerns about cyclical staffing challenges across Hays' key geographies, including the UK, Germany, and Australia/New Zealand (ANZ). The firm's cautious stance underscores the sensitivity of recruitment firms to broader economic trends.

Hays issued a profit warning on June 19, 2025, forecasting a more than 57% decline in annual operating profit to approximately £45 million, significantly below market expectations of £56.4 million. This downturn is primarily attributed to sluggish global hiring trends, notably in Germany's automotive sector, which accounted for 65% of Hays' operating profit in 2024.

The profit warning sent shares plummeting 20% to a 13-year low, impacting not only Hays but also its European peers like PageGroup and Randstad. The company anticipates like-for-like net fees in Germany to decline by 5% for the fiscal year, with group-wide net fees falling 9% in the fourth quarter, with continued hiring challenges anticipated into 2026.

Several insider transactions have occurred in recent months, reflecting a mixed outlook among company executives. Michael Findlay, recently appointed as a non-executive director and chair-designate, acquired 34,382 shares on June 19, 2025, at an average price of 58p per share.

Upcoming full-year FY2025 results, scheduled around August 21-22, 2025, will be closely watched for any commentary on the mix between temporary and permanent placements, cost-cutting measures, and the trajectory of fee income.

The near-term outlook for Hays hinges on macroeconomic trends, particularly in key regions like Germany, where the automotive sector is experiencing headwinds. Any commentary on mix (temp vs permanent placements), cost actions, and fee income trajectory in the FY2025 results and Q1 FY2026 trading update timeline shown on calendars will be crucial in assessing the company's ability to navigate current challenges.