Resources Connection (NASDAQ:RGP – Get Free Report) and ManpowerGroup (NYSE:MAN – Get Free Report) are both industrials companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, analyst recommendations, valuation, profitability, earnings and risk.
Dividends
Resources Connection pays an annual dividend of $0.28 per share and has a dividend yield of 10.5%. ManpowerGroup pays an annual dividend of $1.44 per share and has a dividend yield of 3.1%. Resources Connection pays out -20.6% of its earnings in the form of a dividend. ManpowerGroup pays out 56.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Resources Connection is clearly the better dividend stock, given its higher yield and lower payout ratio.
Analyst Ratings
This is a summary of current ratings and price targets for Resources Connection and ManpowerGroup, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Resources Connection | 1 | 1 | 0 | 0 | 1.50 |
| ManpowerGroup | 1 | 6 | 3 | 0 | 2.20 |
ManpowerGroup has a consensus target price of $51.25, suggesting a potential upside of 11.03%. Given ManpowerGroup’s stronger consensus rating and higher probable upside, analysts clearly believe ManpowerGroup is more favorable than Resources Connection.
Profitability
This table compares Resources Connection and ManpowerGroup’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Resources Connection | -10.74% | -8.10% | -5.48% |
| ManpowerGroup | 0.64% | 7.78% | 1.91% |
Insider and Institutional Ownership
93.2% of Resources Connection shares are held by institutional investors. Comparatively, 98.0% of ManpowerGroup shares are held by institutional investors. 5.5% of Resources Connection shares are held by insiders. Comparatively, 3.0% of ManpowerGroup shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares Resources Connection and ManpowerGroup”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Resources Connection | $452.01 million | 0.20 | -$40.60 million | ($1.36) | -1.96 |
| ManpowerGroup | $17.96 billion | 0.12 | -$13.30 million | $2.53 | 18.25 |
ManpowerGroup has higher revenue and earnings than Resources Connection. Resources Connection is trading at a lower price-to-earnings ratio than ManpowerGroup, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Resources Connection has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500. Comparatively, ManpowerGroup has a beta of 0.68, indicating that its share price is 32% less volatile than the S&P 500.
Summary
ManpowerGroup beats Resources Connection on 12 of the 16 factors compared between the two stocks.
About Resources Connection
Resources Connection, Inc. provides consulting services to business customers under the Resources Global Professionals name in North America, Europe, and the Asia Pacific. The company offers services in the areas of transactions, including integration and divestitures, bankruptcy/restructuring, going public readiness and support, financial process optimization, and system implementation; and regulations, such as accounting regulations, internal audit and compliance, data privacy and security, healthcare compliance, and regulatory compliance. It provides transformations services comprising finance transformation, digital transformation, supply chain management, cloud migration, and data design and analytics. The company was formerly known as RC Transaction Corp. and changed its name to Resources Connection, Inc. in August 2000. Resources Connection, Inc. was founded in 1996 and is headquartered in Irvine, California.
About ManpowerGroup
ManpowerGroup Inc. provides workforce solutions and services worldwide. The company offers recruitment services, including permanent, temporary, and contract recruitment of professionals, as well as administrative and industrial positions under the Manpower and Experis brands. It also offers various assessment services; training and development services; career and talent 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 services; and recruitment process outsourcing, TAPFIN managed, and talent solutions. The company was incorporated in 1948 and is headquartered in Milwaukee, Wisconsin.
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