ASGN – Given management’s excitement about margins and confidence in performance, growth, and markets, bearish market expectations are unwarranted, and upside is likely

• ASGN Incorporated (ASGN:USA) currently trades below corporate averages relative to UAFRS-based (Uniform) Earnings, with a 12.8x Uniform P/E, implying bearish expectations for the firm. However, management is excited about the durability of their profit margin, and confident in their first quarter performance, billable day basis growth, and the strength of their end markets
• Specifically, management generated an excitement marker when saying the durability of their profit margin is based on the way they run their business. In addition, they are confident in their first quarter performance, the historical growth of Stanley, and their ability to sustain growth on a billable day basis. Moreover, they are confident in the strength of their markets and their ability to benefit from growth in the services industry
• Given management’s positive sentiment, market expectations for Uniform ROA compression appear far too bearish, and as such, multiple expansion and equity upside continue to be warranted.