The Q3 trading update was consistent with previous updates and results. SThree continues to perform well in its key growth markets and niche verticals. Net fees were up 6% despite tough comps. As in previous commentaries, management were right to flag macro concerns even though the business has yet to show any signs of material weakness. The key message we took away was that overall expectations for the full year remain unchanged. The subsequent SThree share price outperformance suggests the market may be listening. The Capital Markets Day will be on 21st November. This will provide new CEO, Mark Dorman, the opportunity to outline clearly the direction of travel. We also see the CMD giving a deeper dive into the clear structural growth opportunities and SThree’s less visible assets. We recently spent time at the Glasgow Centre of Excellence and came away seeing Glasgow as far more impactful and front foot than a pure cost cutting exercise. Critically, we believe SThree has a powerful case to make around the fundamental economics of its business model and how this differentiates SThree from its more transactional peers.
30 Sep 2019
Q3 trading update – Is the message finally landing?
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Q3 trading update – Is the message finally landing?
SThree plc (STEM:LON) | 432 6.5 0.4% | Mkt Cap: 582.6m
- Published:
30 Sep 2019 -
Author:
Iain Daly -
Pages:
9
The Q3 trading update was consistent with previous updates and results. SThree continues to perform well in its key growth markets and niche verticals. Net fees were up 6% despite tough comps. As in previous commentaries, management were right to flag macro concerns even though the business has yet to show any signs of material weakness. The key message we took away was that overall expectations for the full year remain unchanged. The subsequent SThree share price outperformance suggests the market may be listening. The Capital Markets Day will be on 21st November. This will provide new CEO, Mark Dorman, the opportunity to outline clearly the direction of travel. We also see the CMD giving a deeper dive into the clear structural growth opportunities and SThree’s less visible assets. We recently spent time at the Glasgow Centre of Excellence and came away seeing Glasgow as far more impactful and front foot than a pure cost cutting exercise. Critically, we believe SThree has a powerful case to make around the fundamental economics of its business model and how this differentiates SThree from its more transactional peers.