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Genpact (G)
NYSE:G
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Genpact
(NYSE:G)
78Outperform
Positive Factors
AI Initiatives
New GenAI initiatives should further help Genpact drive its revenue mix away from traditional BPO and towards next-generation digital.
Earnings
Genpact posted solid 1Q results, beating top and bottom line estimates, added 80 new logos and won two large deals in the quarter.
Partnership Strategy
Partnership strategy is beginning to pay off with a high single-digit percentage of revenues now partner-related.
Negative Factors
Deal Delays
Two large deals were pushed out, causing management to strip them from guidance entirely and increase the buffer for macro volatility.
Exposure Concerns
The company's still-high exposure to traditional BPO remains a concern over the medium-term.
Guidance
Genpact reduced full year 2025 revenue and EPS guidance to account for pushed deals and macro uncertainty.
Genpact (G) vs. S&P 500 (SPY)
Market Cap
$8.69B
Dividend Yield1.27%
Average Volume (3M)1.39M
Price to Earnings (P/E)17.4
Beta (1Y)0.79
Revenue Growth6.46%
EPS Growth-16.94%
CountryUS
Employees140,000
SectorTechnology
Sector Strength65
IndustryInformation Technology Services
Share Statistics
EPS (TTM)0.84
Shares Outstanding174,870,930
10 Day Avg. Volume1,290,871
30 Day Avg. Volume1,391,626
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.97
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit5.01
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$54.75Price Target Upside10.49% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Genpact Business Overview & Revenue Model
Company DescriptionGenpact Limited provides business process outsourcing and information technology (IT) services in India, rest of Asia, North and Latin America, and Europe. It operates through three segments: Banking, Capital Markets and Insurance; Consumer Goods, Retail, Life Sciences and Healthcare; and High Tech, Manufacturing and Services. The company offers CFO advisory services; and environmental, social, and governance (ESG) services, such as data management, carbon accounting, human rights assessment, sustainability diligence, and ESG reporting. It also provides finance and accounting services, which include accounts payable, such as document management, invoice processing, approval and resolution management, and travel and expense processing; invoice-to-cash services, including customer master data management, credit and contract management, fulfillment, billing, collections, and dispute management services; record to report services comprising accounting, treasury, tax, product cost accounting, and closing and reporting services; financial planning and analysis consisting of budgeting, forecasting, and business performance reporting; and enterprise risk and compliance services, including operational risks and controls. In addition, the company provides supply chain advisory services, and after-sales services; sourcing and procurement services comprising direct and indirect strategic sourcing, category management, spend analytics, procurement operation, and master data management; and sales and commercial services, including campaign, order, and dispute management, lead generation, pricing, and promotion optimization. Further, it offers IT services, which comprise end-user computing support, infrastructure management, application production support, and database management services; and transformation services that include digital solutions, consulting services, and analytics services and solutions. The company was founded in 1997 and is based in Hamilton, Bermuda.
How the Company Makes MoneyGenpact generates revenue through a combination of service contracts with its clients, primarily focusing on long-term engagements for business process outsourcing (BPO), information technology services, and consulting. The company's key revenue streams include fees for managed services, project-based consulting, and implementation of digital solutions. Genpact partners with a wide array of industries such as banking, insurance, healthcare, manufacturing, and consumer goods, tailoring its solutions to meet specific industry needs. Additionally, strategic partnerships with technology providers and software vendors play a significant role in enhancing Genpact's service offerings, thereby contributing to its revenue growth.
Genpact Key Performance Indicators (KPIs)
Any
Number of Clients Greater Than $25m Revenue
Shows the count of large clients, reflecting the company's success in securing high-value contracts and its reliance on major revenue sources.
Shows the count of large clients, reflecting the company's success in securing high-value contracts and its reliance on major revenue sources.
Data provided by:
Main Street Data
Main Street DataGenpact Financial Statement Overview
Summary
Genpact exhibits robust financial health characterized by steady revenue and profit growth, strong operating margins, and improved leverage ratios. The company has effectively managed its cash flows, enhancing its ability to fund operations and growth. While the decrease in net profit margin is a concern, overall, the financial position remains strong with a positive outlook.Income Statement
Genpact has shown consistent revenue growth over the years with a Revenue Growth Rate of 6.48% in the latest year. The Gross Profit Margin stands at a solid 35.44%, reflecting efficient cost management. However, the Net Profit Margin decreased to 10.77% compared to the previous year, mainly due to increased expenses. The EBIT and EBITDA margins are healthy at 14.72% and 14.72% respectively, indicating strong operating performance.―
Balance Sheet
The company's Debt-to-Equity Ratio has significantly improved to 0.10, indicating reduced financial leverage. The Return on Equity is robust at 21.49%, showcasing effective utilization of shareholder funds. The Equity Ratio improved to 47.92%, indicating a strong capital structure with an increased proportion of equity financing.78
Cash Flow
Genpact's Free Cash Flow grew by 23.28%, demonstrating an improvement in cash generation capabilities. The Operating Cash Flow to Net Income Ratio stands at 1.20, reflecting strong cash flow generation relative to net earnings. The Free Cash Flow to Net Income Ratio is 1.04, indicating efficient cash flow management.―
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 4.77B | 4.48B | 4.37B | 4.02B | 3.71B | Gross Profit |
| 1.69B | 1.57B | 1.54B | 1.43B | 1.29B | EBIT |
| 702.06M | 630.86M | 502.15M | 509.00M | 438.72M | EBITDA |
| 852.58M | 769.77M | 639.50M | 684.98M | 612.14M | Net Income Common Stockholders |
| 513.67M | 631.25M | 353.40M | 369.45M | 308.28M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 671.61M | 583.67M | 646.76M | 899.46M | 680.44M | Total Assets |
| 4.99B | 4.81B | 4.59B | 4.98B | 4.87B | Total Debt |
| 232.43M | 1.50B | 1.67B | 1.97B | 1.94B | Net Debt |
| -415.81M | 919.33M | 1.02B | 1.07B | 1.26B | Total Liabilities |
| 2.60B | 2.56B | 2.76B | 3.08B | 3.04B | Stockholders Equity |
| 2.39B | 2.25B | 1.83B | 1.90B | 1.83B |
| Cash Flow | Free Cash Flow | |||
| 532.66M | 432.04M | 389.28M | 637.03M | 503.94M | Operating Cash Flow |
| 615.42M | 490.81M | 443.67M | 694.28M | 584.31M | Investing Cash Flow |
| -105.96M | -78.94M | -36.59M | -122.75M | -266.40M | Financing Cash Flow |
| -424.85M | -483.00M | -571.40M | -332.88M | -92.01M |
Genpact Technical Analysis
Negative
49.55
Price Trends
49.26
Negative
48.23
Negative
43.80
Negative
Market Momentum
-0.40
Positive
26.98
Positive
58.98
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For G, the sentiment is Negative. The current price of 49.55 is above the 20-day moving average (MA) of 48.00, above the 50-day MA of 49.26, and above the 200-day MA of 43.80, indicating a bearish trend. The MACD of -0.40 indicates Positive momentum. The RSI at 26.98 is Positive, neither overbought nor oversold. The STOCH value of 58.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for G.
Genpact Risk Analysis
Genpact disclosed 43 risk factors in its most recent earnings report. Genpact reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Genpact Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $7.59B | 35.25 | 23.81% | ― | 14.18% | 21.49% | |
78 Outperform | $8.69B | 17.41 | 22.21% | 1.27% | 6.46% | -16.94% | |
76 Outperform | $10.37B | 22.25 | 13.48% | ― | 14.16% | 22.25% | |
72 Outperform | $7.13B | 28.27 | 10.28% | 1.70% | 2.71% | 39.56% | |
72 Outperform | $2.74B | 15.23 | 21.21% | ― | -0.64% | 30.96% | |
70 Outperform | $8.94B | 20.13 | 12.80% | ― | 0.80% | 10.05% | |
60 Neutral | $10.77B | 10.41 | -6.71% | 2.99% | 7.69% | -13.12% |
* Technology Sector Average
Performance Comparison
G
Genpact
42.04
10.48
33.21%
CACI
Caci International
476.27
47.68
11.12%
DLB
Dolby Laboratories
74.98
-6.53
-8.01%
EPAM
Epam Systems
179.71
-2.22
-1.22%
EXLS
Exlservice Holdings
45.53
14.99
49.08%
WNS
WNS
55.82
6.79
13.85%
Genpact Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: 0.00%|
Next Earnings Date:Aug 07, 2025
Earnings Call Sentiment Neutral
Genpact reported strong financial performance in Q1 2025, with significant revenue and EPS growth driven by strength in Data-Tech-AI and partner-related revenues. However, the company faces challenges with delayed large deals primarily in manufacturing and consumer goods sectors, leading to a conservative revision of full-year guidance. Despite these challenges, the strong pipeline and continued client engagement signal a positive long-term outlook.Q1-2025 Updates
Positive Updates
Record Revenue and EPS Growth
Genpact delivered $1.215 billion in total revenues for Q1, up 8.3% year-over-year in constant currency, above the high-end of guidance. Adjusted EPS grew 16% year-over-year to $0.84.
Strong Performance in Data-Tech-AI
Data-Tech-AI revenue increased by 12% year-over-year in constant currency. Genpact now has over 215 Gen AI solutions in production, with revenues nearly doubling from Q4.
Improved Operating Metrics
Gross margin expanded by 30 basis points to 35.3%, and adjusted operating income margin expanded by 120 basis points to 17.3%.
Partner-Related Revenue Surge
Partner-related revenue increased by 80% year-over-year and more than 10% quarter-over-quarter, representing 10% of total revenues.
Strong Pipeline and Client Engagement
Pipeline is at an all-time high, with large deals up more than 80% year-over-year, showcasing strong long-term demand.
Negative Updates
Delays in Large Deals
Several large deals with higher concentration in Digital Operations were delayed due to supply chain and tariff-related uncertainty, impacting future revenue timing.
Conservative Guidance Revision
Due to increased uncertainty, Genpact lowered its expectations for Digital Operations and Data-Tech-AI for the full year, despite strong early-year momentum.
Challenges in Manufacturing and Consumer Goods Segments
Delayed deals were notably in manufacturing, consumer goods, and high-tech hardware sectors, which are sensitive to global trade dynamics.
Company Guidance
During the 2025 first-quarter earnings call, Genpact Limited reported strong financial performance, with total revenues of $1.215 billion, an 8.3% year-over-year increase in constant currency, surpassing the high-end of their guidance range. The gross margin and adjusted operating income margin also exceeded expectations, and adjusted EPS rose by 16% to $0.84, which was $0.04 above the upper range of their guidance. Despite challenges posed by a softening macro environment, Genpact highlighted their strategic pivot towards Data-Tech-AI, noting that over 80% of the revenue from two large deals signed in Q1 was annuitized Data-Tech-AI revenue. The company decided to take a conservative approach by widening their guidance range and lowering total revenue projections due to delays in closing several large deals within the Digital Operations segment, which were pushed out due to supply chain and tariff-related uncertainties. Nevertheless, Genpact's pipeline was at an all-time high, up more than 80% year-over-year, signaling strong long-term demand. The firm maintained their gross and adjusted operating income margin guidance, emphasizing disciplined cost management while continuing to prioritize investments for sustained growth.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.