Insight

Professional Services Sector Update

Read more about M&A trends and activity in this sector

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Stephen Guy
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Stephen Guy

Managing Director, KPMG Corporate Finance LLC

+1 443-946-9789

Professional Services: Public Markets Update

Global professional services industry participants include providers of consulting services, on-shore and off-shore outsourced solutions, data and information services, human capital management and workforce solutions, and risk and compliance services. Key public industry players in each sub-sector are categorized as follows:

Sub-sector

Mean Public Trading Multiples(1)

 Description of Business Platform

Key Select Industry Leadership
Business Process Outsourcing TEV / LTM Rev: 2.13x
TEV / LTM EBITDA: 13.1x		 On-shore and off-shore outsourced third-party solutions
  • Cognizant
  • Computershare
  • Concentrix
  • ExlService
  • Firstsource Solutions
  • Genpact
  • IBEX
  • NTT Data
  • TD SYNNEX
  • Teleperformance
  • TELUS
  • TTEC
  • WNS
Diversified Data & Information Services TEV / LTM Rev: 6.22x
TEV / LTM EBITDA: 20.4x		 Providers of data, analytics, and business information services
  • Clarivate
  • Equifax
  • Experian
  • Informa
  • RELX
  • Research Solutions
  • Teradata
  • Thomson Reuters
  • Verisk Analytics
  • Wolters Kluwer
Data & Information Services: Financial & Media TEV / LTM Rev: 5.95x
TEV / LTM EBITDA: 20.0x		 Companies offering research, insights, and analytics related to financial market data 
  • FactSet Research Systems
  • Fidelity National Information Services
  • Forrester Research
  • Gartner
  • Ipsos
  • Moody’s
  • Morningstar
  • S&P Global
Governance, Risk, and Compliance Services TEV / LTM Rev: 4.56x
TEV / LTM EBITDA: 15.1x		 Providers of compliance and risk management solutions
  • Broadridge Financial Solutions
  • Fiserv
  • International Business Machines
  • Netapp
  • Oracle
  • SAP
  • Workday
HR Staffing & Professional Services TEV / LTM Rev: 0.89x
TEV / LTM EBITDA: 8.3x		 Workforce solutions
  • Adecco Group
  • AMN Healthcare Services
  • ASGN
  • Capita plc
  • CBIZ
  • Hays
  • Heidrick & Struggles
  • Kelly Services
  • Kforce
  • Korn Ferry
  • ManpowerGroup
  • Marsh & McLennan
  • PageGroup
  • Randstad
  • Resources Connection
  • Robert Half Intl.
  • TrueBlue
Human Resource Outsourcing TEV / LTM Rev: 3.58x
TEV / LTM EBITDA: 14.8x		 Outsourced human capital  management service offerings 
  • Aon
  • Automatic Data Processing
  • Barrett Business Services
  • Insperity
  • Paychex
  • TriNet Group
  • Willis Towers Watson
IT Consulting TEV / LTM Rev: 2.16x
TEV / LTM EBITDA: 12.7x		 Providers of information technology solutions
  • Accenture
  • Atos
  • Capgemini
  • CGI
  • Conduent
  • DXC Technology
  • HCL Technologies
  • ICF International
  • Infosys
  • Tata Consultancy Services
  • Tech Mahindra
  • Wipro
Speciality Consulting TEV / LTM Rev: 1.88x
TEV / LTM EBITDA: 14.1x		 Advisory, consulting, and analytic service offerings
  • Booz Allen Hamilton
  • CACI International
  • CRA International
  • FTI Consulting
  • Huron Consulting
  • Perficient
  • The Hackett Group

     

Sector Perspectives: U.S. Staffing & Human Capital Services

Staffing services remains an attractive sector for investors for multiple reasons:

  • The staffing industry is characterized by high fragmentation, which offers significant growth potential through strategic M&A opportunities
  • Visible and recurring revenue streams, and a flexible cost base provides for predictable cash flows
  • Low capital intensity (asset-light model) allows for growth opportunities with limited capital investment
  • Sustained industry demand is driven through the increasingly common strategy for corporations to utilize temporary staffing as a flexible way to scale operations


U.S. financial sponsor M&A activity and aggregate reported deal values ($s in billions)


Source: Market statistics sourced from Capital IQ and based on 2/28/2023. Industry data sourced from publicly available information

    


Notable recent staffing services M&A activity by financial sponsors

Date

Target

Acquiror
Jan-23
 Queen Consulting Group
 Talent Group / Osceola Capital
Jan-23
 Agency WorX
 WorkGenius Group / SFO - Swiss Family Office SA
Dec-22
 Rayne Staffing
 Critical Energy Infrastructure Services / White Wolf Capital
Dec-22
 SpringBoard Healthcare Group
 Ingenovis Health / Trilantic North America
Oct-22
 DecisionPathHR
 PeopleShare / Trivest Partners
Aug-22
 Barton & Associates
 H.I.G Capital
Apr-22
 Epic Staffing Group(2)
 The Pritzker Organization
Apr-22
 VISTA Staffing Solutions
 Ingenovis Health / Trilantic North America

Footnotes

  1. Valuation Multiples represent Enterprise Value to LTM Revenue and LTM EBITDA at 2/28/2023
  2. The Pritzker Organization acquired Epic Staffing Group for a total consideration of $675m at a valuation of 11.3x EV / LTM EBITDA

     


We hope you find this information valuable, and as always, feel free to reach out if you would like to discuss in further detail. To read the full report, download the PDF below

Professional Services Sector Update
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