One of the primary goals of my investment portfolio and strategy is to boost my passive income stream through dividend stocks. One business that I want to take a closer look at is Pagegroup (LSE:PAGE). Should I buy the shares?
Recruitment business
Pagegroup is an international recruitment business with over 8,000 employees spread across 37 countries. Formed in 1976, it has grown into an industry leader and continues to target expansion. It is split into four core brands and recruits across 25 main disciplines including technology, finance, legal, and HR.
So what’s happening with Pagegroup shares currently? Well, as I write, they’re trading for 375p. At this time last year, the stock was trading for 635p, which is a 40% drop over a 12-month period.
To buy or not to buy?
Let’s take a look at some pros and cons of me buying Pagegroup shares.
FOR: I’m buoyed by Pagegroup’s recent performance. I am aware that past performance is not a guarantee of the future. However, looking back, it has recorded consistent revenue and profit for the past four years. More recently, it released a half-year report last week for the period ended 30 June 2022. I noticed that revenue and profit increased by 27% and 33% respectively compared to the same period last year. The interim dividend was higher than last year. Furthermore, Pagegroup announced a special dividend to reward shareholders. At present, the shares’ dividend yield stands at a mighty 11%. I do understand that dividends can be cancelled, however.
AGAINST: Due to current economic volatility and soaring inflation, confidence in business is falling. Businesses may need to cut costs, which could include hiring freezes. This could impact demand for Pagegroup’s services, and hinder performance and returns.
FOR: On the other side of the coin from potential hiring freezes due to volatility, there is a general shortage of candidates for relevant roles across many sectors throughout the world, especially in developed economies like the UK. This could see Pagegroup experience a rise in demand for its services, and boost performance. In addition to this, the shares look good value for money right now on a price-to-earnings ratio of just seven.
AGAINST: Recruitment is a saturated marketplace. Many firms, of all shapes, sizes, and profiles are vying to fill the same roles and have the best candidates on their books. I will keep an eye on competitors to see how they are performing against Pagegroup.
A passive income stock I will continue to monitor
Taking everything into account, I like the look of Pagegroup shares. It is a global business with a great track record as well as good recent performance. The shares also look good value for money.
What’s putting me off is the current economic volatility and the uncertainty that comes with it. This is the reason I will keep Pagegroup shares on my watch list for now and monitor developments.