IBEX LTD (NASDAQ:IBEX) – A Strong Candidate for Growth at a Reasonable Price

IBEX LTD (NASDAQ:IBEX) stands out as a compelling pick for investors seeking growth at a reasonable price (GARP). The company, a business process outsourcing provider, meets key criteria from Peter Lynch’s investment strategy, combining solid growth, strong profitability, and an attractive valuation.

Why IBEX Fits the GARP Approach

• Strong Earnings Growth: IBEX has delivered an impressive 5-year average EPS growth of 25.59%, comfortably within Lynch’s preferred range of 15-30%. This suggests sustainable expansion rather than overheated growth.
• Attractive Valuation: With a PEG ratio (past 5 years) of 0.48, well below the threshold of 1, the stock appears undervalued relative to its growth trajectory.
• Healthy Financials: The company maintains a conservative debt profile, with a debt-to-equity ratio of 0.16, far below Lynch’s upper limit of 0.6. Its current ratio of 1.67 also indicates sufficient liquidity.
• High Profitability: IBEX’s return on equity (ROE) of 29.89% reflects efficient use of shareholder capital, exceeding Lynch’s 15% benchmark.

Fundamental Strengths

Our fundamental analysis assigns IBEX a rating of 7 out of 10, highlighting its excellent profitability and financial health. Key takeaways include:

• Top-tier ROE and ROIC, outperforming most peers in the IT services industry.
• Improving margins, with operating and profit margins trending upward.
• Reasonable valuation metrics, including a P/E of 12.32, significantly below industry averages.

For a deeper dive, review the full fundamental report on IBEX.

Our Peter Lynch Strategy screener lists more stocks that fit this strategy and is updated daily.

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should always conduct your own analysis before making investment decisions.