Here are Petri’s quick comments on the Q2 results.
Eezy published its Q2 report this morning. The quarter’s operational performance fell clearly short of our expectations, as the decline in Staffing Services revenue was significantly steeper than we anticipated. The company has not provided guidance for this year, and as expected, none was provided at this stage either. Eezy’s Q2 briefing starting at 1:00 PM can be followed on inderesTV at this link.
Hi! There will be no additional costs for 2025 related to the operating model renewal announced today, August 6, 2024.
Hoping for an evening bonus, Petri has put together this analysis. 
Eezy’s revenue contracted more sharply than our expectations in Q2, which also weighed heavily on the results. The challenges are linked to the company’s own staffing services, where revenue declined significantly, reflecting particularly the contraction of the market and the company’s key customer industries. We have cut our forecasts for the coming years, but we expect earnings to return to growth as economic growth picks up next year. However, in our view, the share’s valuation is somewhat high even based on our 2025 forecasts. At the same time, high indebtedness and tightened competition keep the risk level elevated. Against this background, we are cutting our target price to EUR 1.2 (prev. EUR 1.35) and reiterate our reduce recommendation. The Eezy CEO’s Q2 interview can be viewed at this link.
Insiders have bought some shares
Pajuharju
Transaction date: 2024-08-09
Trading venue: NASDAQ HELSINKI LTD (XHEL)
Instrument type: SHARE
ISIN: FI4000322326
Nature of the transaction: ACQUISITIONDetailed information on transactions
(1): Volume: 3370 Unit price: 1.265 EUR
(2): Volume: 548 Unit price: 1.255 EUR
(3): Volume: 1491 Unit price: 1.265 EUR
(4): Volume: 2922 Unit price: 1.26 EUR
(5): Volume: 600 Unit price: 1.2725 EURAggregated transaction data (5):
Volume: 8931 Average price: 1.26325 EUR
Transaction date: 2024-08-12
Trading venue: NASDAQ HELSINKI LTD (XHEL)
Instrument type: SHARE
ISIN: FI4000322326
Nature of the transaction: ACQUISITIONDetailed information on transactions
(1): Volume: 298 Unit price: 1.28 EUR
(2): Volume: 691 Unit price: 1.28 EUR
(3): Volume: 12 Unit price: 1.27 EUR
(4): Volume: 1433 Unit price: 1.27 EUR
(5): Volume: 230 Unit price: 1.27 EUR
(6): Volume: 779 Unit price: 1.28 EUR
(7): Volume: 1558 Unit price: 1.28 EURAggregated transaction data (7):
Volume: 5001 Average price: 1.27665 EUR
Hagros
Transaction date: 2024-08-07
Trading venue: NASDAQ HELSINKI LTD (XHEL)
Instrument type: SHARE
ISIN: FI4000322326
Nature of the transaction: ACQUISITIONDetailed information on transactions
(1): Volume: 4000 Unit price: 1.26 EURAggregated transaction data (1):
Volume: 4000 Average price: 1.26 EUR
It’s good that management is at least buying a little.
The downside is that it also signals that there is no insider activity, such as a company sale, currently underway…
I’m starting to get an appetite for a deal with some kind of premium myself…
Petri’s comments on the goings-on in the staffing services industry might be of interest in this thread.
Here are the Staffing Industry’s views directly
In July, the value of turnover for staffing services was 105.7 million euros. Total turnover decreased in July by 5.5 percent compared to July of the previous year.
According to the August business cycle outlook of the EK (Confederation of Finnish Industries) Business Cycle Barometer, the situation for staffing services remains largely unchanged, and no significant change is expected. The business cycle expectation had worsened since July.
CEO Siina Saksi spoke about Eezy as an investment.
I’ve heard that we don’t have any AI companies on the stock exchange. This doesn’t seem to be the case, as Eezy’s CEO mentioned AI quite a few times in the presentation. Watch out, Nvidia! AI is supposed to streamline operations, so could it be used to reduce Eezy’s office staff? They could then look for new jobs through Eezy, maybe in construction—it would be a win-win for Eezy! 
Here is a recent comprehensive report on Eezy: Eezy laaja raportti: Kannattavuustoimet punnitaan suhdanteen kääntyessä - Inderes
At the same time, I also want to highlight Eezy’s Capital Markets Day from last spring, as I reviewed it again as part of the process for the comprehensive report. In my opinion, the Capital Markets Day was very successful, and I think they managed to crystallize the key messages quite concisely. In my books, it ranks right at the top among the Capital Markets Days I’ve seen over the years.
The presentation can be found here: Eezy, Webcast, CMD, 2024 - Inderes
Slide deck here
Pete and Vepu talked about Eezy in connection with the extensive report.
Topics:
00:00 Intro
00:18 What Eezy does
02:00 Why has the stock collapsed?
06:03 Target market and competition
11:40 Targets
14:40 When would Eezy be an interesting investment
Eezy had good slides, but I was left feeling a bit uneasy that the company couldn’t build a sufficiently concrete bridge of actions between the current situation and the 2028 targets.
-2028: EBIT 8%
-staffing services (85% of the company) grow faster than the market. Stated CAGR 8%
-expert services (15% of the company): doubling, i.e., CAGR approx. 15%
In the shorter term, the company has stated that historically the industry starts to react quickly at a cyclical turnaround.
In my experience, targets and slides are easy to create, but what is difficult is: functional action plans, execution and its monitoring, and reacting effectively to both plan weaknesses and deviations.
Based on the DCF valuation in the extensive report, you don’t seem to have enough faith in Eezy’s stories either, and judging by the stock’s valuation, neither does anyone else—not that the targets will be met, neither the top-line nor the bottom-line, let alone both.
Based on my own calculations, Eezy’s 2028 targets would lead to a revenue level of 275 MEUR and an EBIT level of 27 MEUR, making the EPS around 0.78 EUR/share.
Of course, from a shareholder’s perspective, it’s comforting that the report’s DCF valuation of 1.6 EUR is reached with the parameters used even with a significant target miss, i.e.:
-2028 revenue 218 MEUR (i.e., 2023 level)
-2028 EBIT 5.0%, i.e., 10.9 MEUR
-resulting in an EPS of around 0.25 EUR/share
Summa Summarum, the company doesn’t need to get anywhere near its targets for the valuation to indeed seem quite affordable. On the other hand, both revenue and earnings targets can fail reasonably, and the investment can still be decent.
Turnaround company or cyclical turnaround, both are good and preferably both.
https://keskustelut.inderes.fi/t/eezy-sijoituskohteena-ent-vmp/105/390?u=opa
As for that bridge, I think the steps for how they intend to reach that profitability have been laid out quite clearly. Additionally, several growth drivers have been introduced. So, in my opinion, there’s even more concreteness here than usual, and at least I was left with the impression that the company has clear plans for its targets.
Btw, I’ve been thinking a lot lately about whether a good target is one that is achieved, or one that pushes for the best possible performance but isn’t quite reached 
This is just some general-level thinking, and doesn’t only apply to these targets.
That is absolutely true. But it’s easier to execute on top of a good plan; let’s see how it goes.
Yeah, expectations for both us and the market are clearly below the targets. In the video, Vepu and I went over this valuation, or more precisely, how a good expected return could be built at this price.
Eezy case regarding Martela. [Mainos: Eezy] Vaihtelevat työvoimatarpeet aiheuttavat haasteita yrityksille – näin Martela ratkaisi ongelman vuokratyövoimalla | HS.fi
Martela is, after all, Finland’s second largest moving company. Which stock is a better investment? There is upside potential in both, a multiple of even 10:1 if successful. Both have an 8% operating profit target. Martela has achieved it before, but it was so long ago that even the decade has been forgotten, but when you own ten of these, maybe one will hit the mark.. (I own both)
Insider purchase for the record here as well
Tommi Saarinen’s comments on the staffing industry’s gloomy performance in August. 
According to the staffing industry turnover survey, the turnover of the 20 largest companies in the sector was EUR 134 million in August, which represents an 8% decrease from a year ago. The development of the total market is essentially linked to temporary staffing services, which accounted for approximately 82% of the turnover of the largest players in August. Consequently, the turnover of temporary staffing services was approximately EUR 110 million. This corresponds to a decrease of just under 9% compared to a year ago.
There’s movement in the management team involving two individuals (Business Director of Staffing Services Ari Myllyniemi & HR and Development Director Saara Tikkanen). Personally, I view it as a negative that the head of the staffing business specifically is leaving, as that business is a significant part of Eezy and the person has been with the company for a long time. It also naturally raises the question of whether there is some “larger” disagreement within the management team when multiple people are departing.
Maybe the gentleman didn’t have what it takes, and in that case, a change is necessary.
But it’s bad news, because:
And apparently, even the departing HR person was recruited from Verkkis (Verkkokauppa.com) so that they started by 3/2024 at the latest…
Ari Myllyniemi has been appointed as Director of the Staffing Services business area and a member of the Management Team as of June 1, 2024. Myllyniemi has fifteen years of experience in the staffing and recruitment industries, and he has been with Eezy since 2018. Most recently, he has served in the position in an interim role since January, and before that, as Sales and Service Production Director of the Staffing Services business area.
Saara Tikkanen (M.Sc. Econ., b. 1982) has been appointed as HR and Development Director of Eezy Plc and a member of the Management Team. She will start her work by March 2024 at the latest.
@marleena.bask any comment on why these individuals were in their roles for such a short time? Eezy’s performance certainly doesn’t inspire confidence.
Jussila has bought even more, and I missed it. The amount isn’t staggering this time, but insider buys are always positive to see.
Liiketoimien yksityiskohtaiset tiedot
(1): Volume: 60 Unit price: 1.48 EUR
(2): Volume: 400 Unit price: 1.4691 EUR
Aggregated transaction information (2):
Volume: 460 Average price: 1.47052 EUR