Broker snap: Hays price now reflects cuts scenario

8th Jul 2010 13:10

The anticipated decline in public sector recruitment opportunities is now reflected in the share price of Hays, according to KBC Peel Hunt, which has turned less bearish on the stock after Thursday's trading update."In the short to medium term we see no catalysts for the stock and note the 6.4% yield should underpin the shares at these levels. We therefore move our recommendation from Sell to Hold," said KBC analyst Henry Carver.The recruitment firm said that trading has been in line with management expectations, leaving the broker comfortable with its existing earnings estimates. It is predicting adjusted profit before tax for fiscal 2010 (to June) of £66.6m, while for the year after it is going for £86.1m. The broker is sticking with its target price of 90p, which was virtually bang on the share price of Hays on the even of the trading update. Hays's share price has fallen from a 52-week high of 117.80p in less than three months.