July 30, 2008 - Manpower Inc. (MAN-NYSE) provides employment services in the United States, France, Europe, the Middle East, Africa, Italy, Australia, Japan, Mexico, Argentina, Canada, and Asia. It offers permanent, temporary, and contract recruitment services; employee assessment and selection services; training; outplacement; outsourcing; and consulting services, as well as provides professional services to public accounting firms and other consulting groups delivering professional services in the areas of internal controls, tax, technology risk management, and finance and accounting. The company was founded in 1948 and is headquartered in Milwaukee, Wisconsin.

Earnings came in at 94 cents a share for the first three months, up from 79 cents last year.  For the second quarter, though, there was disappointment as earnings were $1.34, well below $1.86 of last year's quarter.  Revenues were up by 17% to $5.9 billion.  The quarter was hurt by legal costs and a weaker U.S. economy.  For the year, analysts see $5.47, up from $4.89 last year and next year predict $5.32.

The weaker dollar is helping the numbers.  As international searches are paid for in foreign currency, then exchanged back to U.S. dollars, the company picks up earnings.   MAN generates about 91% of its profits internationally.  While Europe in general is robust, France isn't part of the growth.  In fact, France and the U.S. are two noticeable laggards in the company's sales efforts.

The stock has already felt investors' disappointment.  Last year, it traded at an all-time high of $97.30.  With the most recent quarter's news, it was hit again.  Now it's a little over half of its high with decent earnings growth expected for the next year at least.  With a P/E (price to earnings) ratio of 9, investors aren't anticipating major upward earnings gains anytime soon.

Other numbers: Return on Equity was 16% for the last 12 months.  For 2007, it was 14.7%.  There's a dividend paid twice a year, totals 74 cents this year, up from 69 cents this year.  Book Value is $36.67 with cash per share at $7.08.  Price to Book is 1.4.  Total debt to equity is 35%.  Current assets outnumber current liabilities 1.6 to 1.  Market cap is $3.9 billion on 79.2 million shares.  Sales for 2008 are expected to be $23.4 billion and in 2009, $23.95 billion.  Analysts predict earnings growth of 13% a year, on average, over the next 5.

Manpower was flying high in 2007, only to crash in 2008.  With a small disappointment in earnings, investors have abandoned it with punishing results.  While the large earnings jumps of 2005 to 2006 (went from $2.87 to $3.76) and then to 2007 ($4.89) aren't in anybody's forecast, decent growth should continue.  And that's with the U.S. economy slowing.  If that were to change, every analyst will go back to the numbers and bump them.  Noticeably.

- Company Web site: www.manpower.com

- Ted Allrich