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Adecco shares fall after Goldman downgrade

Adecco shares fall after Goldman downgrade
Shares in Adecco dropped 2 percent after Goldman Sachs downgrades the world's largest staffing company to "sell" from "neutral", and adds the firm to its pan-European conviction sell list, citing risks to the firm's top-line growth.
In a review of the staffing sector, the broker says top-line growth at both Adecco and Dutch staffing firm Randstad could plateau this quarter as suggested by recent temp numbers in the U.S. and France and by Adecco's second-quarter exit rate.
"Furthermore, 2011 forecasts could come under pressure from lower economic growth," Goldman Sachs analysts write in a note.
The broker cuts Adecco's price target to 45 Swiss francs from 58.8, and lowers Randstad's price target to 31 euros from 33 euros with a "sell" rating on the stock. Randstad adds 0.4 percent.
The broker upgrades its recommendation to "buy" from "neutral" for Hays and Robert Walters and to "buy" from "sell" for Michael Page as it expects the firms to benefit from late cycle improvement in specialist staffing markets and from their developing market exposure.

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