ManpowerGroup (NYSE: MAN) and StarTek (NYSE:SRT) are both business services companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, profitability, valuation, dividends, institutional ownership and earnings.
Dividends
Get ManpowerGroup alerts:ManpowerGroup pays an annual dividend of $2.02 per share and has a dividend yield of 2.4%. StarTek does not pay a dividend. ManpowerGroup pays out 28.7% of its earnings in the form of a dividend. ManpowerGroup has increased its dividend for 7 consecutive years.
Profitability
This table compares ManpowerGroup and StarTek’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| ManpowerGroup | 2.61% | 18.67% | 6.02% |
| StarTek | -4.65% | -9.33% | -4.44% |
Institutional and Insider Ownership
92.9% of ManpowerGroup shares are held by institutional investors. Comparatively, 37.5% of StarTek shares are held by institutional investors. 1.0% of ManpowerGroup shares are held by insiders. Comparatively, 17.8% of StarTek shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Volatility & Risk
ManpowerGroup has a beta of 1.34, suggesting that its share price is 34% more volatile than the S&P 500. Comparatively, StarTek has a beta of 0.21, suggesting that its share price is 79% less volatile than the S&P 500.
Valuation & Earnings
This table compares ManpowerGroup and StarTek’s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| ManpowerGroup | $21.03 billion | 0.27 | $545.40 million | $7.04 | 12.04 |
| StarTek | $292.60 million | 0.37 | -$1.27 million | ($0.08) | -83.25 |
ManpowerGroup has higher revenue and earnings than StarTek. StarTek is trading at a lower price-to-earnings ratio than ManpowerGroup, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of current recommendations for ManpowerGroup and StarTek, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| ManpowerGroup | 1 | 6 | 4 | 0 | 2.27 |
| StarTek | 0 | 2 | 1 | 0 | 2.33 |
ManpowerGroup currently has a consensus target price of $120.50, suggesting a potential upside of 42.12%. StarTek has a consensus target price of $12.67, suggesting a potential upside of 90.19%. Given StarTek’s stronger consensus rating and higher possible upside, analysts clearly believe StarTek is more favorable than ManpowerGroup.
Summary
ManpowerGroup beats StarTek on 12 of the 17 factors compared between the two stocks.
ManpowerGroup Company Profile
ManpowerGroup Inc. provides workforce solutions and services in the Americas, Southern Europe, Northern Europe, and the Asia Pacific Middle East region. The company's recruitment service portfolio includes permanent, temporary, and contract recruitment of professionals, as well as administrative and industrial positions. It also offers various assessment services; training and development services; career management; and outsourcing services related to human resources functions primarily in the areas of large-scale recruiting and workforce-intensive initiatives. In addition, the company provides workforce consulting services; contingent staffing and permanent recruitment services; professional resourcing and project-based solutions in information technology, engineering, and finance fields; solutions in the areas of organizational efficiency, individual development, and career mobility; and recruitment process outsourcing, TAPFIN managed, and talent based outsourcing services, as well as Proservia services in the areas of digital services market and IT infrastructure sector. It operates through a network of approximately 2,700 offices in 80 countries and territories. The company was founded in 1948 and is based in Milwaukee, Wisconsin.
StarTek Company Profile
StarTek, Inc. provides business process outsourcing services in the United States, Canada, Honduras, Jamaica, and the Philippines. It operates in three segments: Domestic, Nearshore, and Offshore. The company's service offerings include customer care, sales support, inbound sales, complex order processing, accounts receivable management, technical and product support, up-sell and cross-sell opportunities, customer intelligence analytics, and other industry-specific processes. It offers technical and product support services through telephone, e-mail, chat, facsimile, and Internet; and sales support services comprising lead generation, direct sales, account management and retention programs, and marketing analysis and modeling. The company's provisioning and order processing services comprise full life cycle order management and technical sales support for high-end telecommunications services, such as wire-line, wireless, data, and customer premise equipment; order fallout from its clients' automated systems, billing review, revenue recovery, and quality assurance; direct-to-consumer services, such as provisioning, order processing, and transfer of accounts between client service providers. Its receivables management services consist of first and third party collections services for clients in the telecommunication, cable and media, and healthcare industries; healthcare services include customer care, sales support, accounts receivable management, remote patient care, and medical triage to providers, payers, pharmaceutical, and medical devices; and industry-specific processes comprise training curriculum development, workforce management, customer analytics, quality monitoring services, and dispositions. The company was founded in 1987 and is headquartered in Greenwood Village, Colorado.
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