Professional Services Practice Overview

Introduction

Harris Williams is pleased to present our Professional Services Industry Update for July 2020. This report provides commentary and analysis on current capital market trends and merger and acquisition dynamics within the global professional services industry.

We hope you find this edition helpful, and we encourage you to contact us directly if you would like to discuss our perspective on current industry trends and M&A opportunities or our relevant industry experience.

Our Practice

Harris Williams’ Business Services Group has experience advising companies that provide a range of commercial, industrial and professional services. 

This particular report focuses on trends and metrics in the following areas:

  • Business Process Outsourcing
  • Consulting
  • Education & Training
  • Engineering
  • Financial Services
  • Governance, Risk & Compliance
  • Human Capital Management
  • Information Technology
  • Insurance & Risk Management
  • Legal Services
  • Marketing & Information
  • Workforce Solutions

Representative Professional Services Transactions

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What We’re Reading

New Coalition Launches to Boost Economic Mobility for America's Displaced Frontline Workforce

PR Newswire  7/9/2020

"According to a recent McKinsey report, up to one-third of U.S. jobs may be vulnerable as a result of COVID-19, and more than eighty percent of those are held by low-income workers. Designed to address the impact of the crisis on the most vulnerable communities in the American workforce, the SkillUp Coalition will leverage partners' strengths to provide new pathways to career opportunities for the more than 40 million Americans who have filed for unemployment in the last several months."

Read the full article here.

U.S. Adds More Than 200,000 IT Workers in June

The Wall Street Journal  7/7/2020

"Hiring in June was buoyed by strong demand in the tech manufacturing sector, followed by data processing and information services, CompTIA said. Across the board, employers last month posted more than 260,000 job ads for IT workers, led by software developers, IT support specialists and systems engineers, the group said."

Read the full article here.

The Rise of Talent As a Service

Forbes  6/30/2020

"As global competition is getting fiercer by the second, companies are forced to focus intensely on productivity in order to be innovative, all at a lower price. At the same time, there's a major shift in mindset toward more open, less-restrictive and collaborative organizations. Work as we know it is transforming at the speed of light."

Read the full article here.

The Impact of Artificial Intelligence on Professional Services

Forbes  6/8/2020

"When you hear the word 'automation...', does your mind skip straight to '…destroys jobs'? If so, there should be a few stops in between. Automation is about removing friction, driving down costs, speeding processes up, and generally improving efficiency. Making goods and services better and cheaper is a good thing: it makes us all richer."

Read the full article here.

Top Business Process Outsourcing Trends to Dominate in 2020

Managed Outsourced Solutions  4/24/2020

"Driven by competition, innovation, and advances in technology, the BPO industry is continuously gaining momentum. Furthermore, the trend is expected to continue over the forecast period as the need to reduce operating costs, synchronize processes, and get access to qualified professionals prompts more and more enterprises to outsource their business processes."

Read the full article here.

Public Markets1

Historical Stock Prices – Last 5 Years

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Historical Median TEV/LTM EBITDA Multiples – Last 5 Years

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Notes: Data as of July 14, 2020. Sub-sector indices weighted by stock price.

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Notes: Data as of July 14, 2020. 

Economic Trends

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M&A Market Trends1

Professional Services M&A Volume by Year

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Note: Data through July 14, 2020.

Representative Professional Services M&A Transactions by Sector

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1. S&P Global Capital IQ

2. U.S. Bureau of Economic Analysis

3. The Conference Board

4. U.S. Bureau of Labor Statistics

5. U.S. Department of Labor

6. Institute for Supply Management

 

Public Comparable Companies:

BPO: Cognizant, Computershare, DXC, ExlService, Genpact, Sykes Enterprises, Tata Consultancy, TTEC, Wipro, and WNS

Consulting: Accenture, CBIZ, CRA International, FTI Consulting, Huron Consulting Group, ICF International, and Resources Connection

Human Capital: 51job, ASGN, Barrett Business Services, Hays, Heidrick & Struggles International, Insperity, Kelly Services, Kforce, Korn Ferry, ManpowerGroup, Randstad, Robert Half International, SThree, TrueBlue, Willis Towers Watson

IL&R Services: Aon, Arthur J. Gallagher & Co., Brown & Brown, Crawford & Company, Marsh & McLennan Companies, Willis Towers Watson

M&I Services: Alliance Data Systems, comScore, CoreLogic, CoStar Group, Equifax, Experian, FactSet, Fair Isaac, Forrester Research, IHS Markit, Informa, LiveRamp Holdings, Moody's, Morningstar, Nielsen Holdings, Omnicom Group, Publicis Groupe, The Interpublic Group of Companies, Thomson Reuters, Verisk Analytics, Viad, Wolters Kluwer, WPP

Transaction Processing: Automatic Data Processing, Fidelity National Information Services, Global Payments, Jack Henry & Associates, Paychex, The Western Union Company

Education and Training: Adtalem Global Education, American Public Education, Franklin Covey, GP Strategies, Grand Canyon Education, K12, Lincoln Educational Services, Pearson, Scholastic, Strategic Education, Zovio

 

The information and views contained in this report were prepared by Harris Williams LLC (“Harris Williams”). It is not a research report, as such term is defined by applicable law and regulations, and is provided for informational purposes only. It is not to be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any securities or financial instruments or to participate in any particular trading strategy. The information contained herein is believed by Harris Williams to be reliable but Harris Williams makes no representation as to the accuracy or completeness of such information. Harris Williams and/or its affiliates may be market makers or specialists in, act as advisers or lenders to, have positions in and effect transactions in securities of companies mentioned herein and also may provide, may have provided, or may seek to provide investment banking services for those companies. In addition, Harris Williams and/or its affiliates or their respective officers, directors and employees may hold long or short positions in the securities, options thereon or other related financial products of companies discussed herein. Opinions, estimates and projections in this report constitute Harris Williams’ judgment and are subject to change without notice. The securities and financial instruments discussed in this report may not be suitable for all investors and investors must make their own investment decisions using their own independent advisors as they believe necessary and based upon their specific financial situations and investment objectives. Also, past performance is not necessarily indicative of future results. No part of this material may be copied or duplicated in any form or by any means, or redistributed, without Harris Williams’ prior written consent. 

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