GENPACT LTD (G) Stock Fundamental Analysis
NYSE:G - New York Stock Exchange, Inc. - BMG3922B1072 - Common Stock - Currency: USD
G gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 82 industry peers in the IT Services industry. Both the health and profitability get an excellent rating, making G a very profitable company, without any liquidiy or solvency issues. G is valued quite cheap, while showing a decent growth score. This is a good combination! These ratings could make G a good candidate for value and quality investing.
1. Profitability
1.1 Basic Checks
G had positive earnings in the past year.
G had a positive operating cash flow in the past year.
Each year in the past 5 years G has been profitable.
Each year in the past 5 years G had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 10.78%, G belongs to the best of the industry, outperforming 86.59% of the companies in the same industry.
G's Return On Equity of 21.51% is amongst the best of the industry. G outperforms 85.37% of its industry peers.
With an excellent Return On Invested Capital value of 13.42%, G belongs to the best of the industry, outperforming 82.93% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for G is significantly below the industry average of 22.82%.
The 3 year average ROIC (12.82%) for G is below the current ROIC(13.42%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.78% | ||
| ROE | 21.51% | ||
| ROIC | 13.42% |
ROA(3y)10.38%
ROA(5y)8.98%
ROE(3y)22.97%
ROE(5y)21.04%
ROIC(3y)12.82%
ROIC(5y)11.64%
1.3 Margins
G has a Profit Margin of 10.88%. This is in the better half of the industry: G outperforms 78.05% of its industry peers.
In the last couple of years the Profit Margin of G has grown nicely.
G has a better Operating Margin (14.96%) than 79.27% of its industry peers.
In the last couple of years the Operating Margin of G has grown nicely.
G has a Gross Margin of 35.51%. This is comparable to the rest of the industry: G outperforms 50.00% of its industry peers.
G's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.96% | ||
| PM (TTM) | 10.88% | ||
| GM | 35.51% |
OM growth 3Y5.04%
OM growth 5Y3.32%
PM growth 3Y5.47%
PM growth 5Y4.47%
GM growth 3Y-0.14%
GM growth 5Y0.36%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so G is still creating some value.
Compared to 1 year ago, G has less shares outstanding
G has less shares outstanding than it did 5 years ago.
The debt/assets ratio for G has been reduced compared to a year ago.
2.2 Solvency
G has an Altman-Z score of 3.92. This indicates that G is financially healthy and has little risk of bankruptcy at the moment.
G has a Altman-Z score of 3.92. This is in the better half of the industry: G outperforms 68.29% of its industry peers.
G has a debt to FCF ratio of 2.07. This is a good value and a sign of high solvency as G would need 2.07 years to pay back of all of its debts.
The Debt to FCF ratio of G (2.07) is better than 70.73% of its industry peers.
G has a Debt/Equity ratio of 0.49. This is a healthy value indicating a solid balance between debt and equity.
G has a Debt to Equity ratio of 0.49. This is comparable to the rest of the industry: G outperforms 48.78% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.07 | ||
| Altman-Z | 3.92 |
ROIC/WACC1.38
WACC9.72%
2.3 Liquidity
G has a Current Ratio of 2.45. This indicates that G is financially healthy and has no problem in meeting its short term obligations.
G has a Current ratio of 2.45. This is in the better half of the industry: G outperforms 76.83% of its industry peers.
G has a Quick Ratio of 2.45. This indicates that G is financially healthy and has no problem in meeting its short term obligations.
With a decent Quick ratio value of 2.45, G is doing good in the industry, outperforming 76.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.45 | ||
| Quick Ratio | 2.45 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 14.85% over the past year.
Measured over the past years, G shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.38% on average per year.
G shows a small growth in Revenue. In the last year, the Revenue has grown by 6.48%.
The Revenue has been growing slightly by 6.25% on average over the past years.
EPS 1Y (TTM)14.85%
EPS 3Y9.42%
EPS 5Y9.38%
EPS Q2Q%22.22%
Revenue 1Y (TTM)6.48%
Revenue growth 3Y5.83%
Revenue growth 5Y6.25%
Sales Q2Q%6.65%
3.2 Future
The Earnings Per Share is expected to grow by 10.38% on average over the next years. This is quite good.
Based on estimates for the next years, G will show a small growth in Revenue. The Revenue will grow by 6.43% on average per year.
EPS Next Y10.34%
EPS Next 2Y9.81%
EPS Next 3Y10.38%
EPS Next 5YN/A
Revenue Next Year4.69%
Revenue Next 2Y5.58%
Revenue Next 3Y6.43%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 12.51, the valuation of G can be described as correct.
G's Price/Earnings ratio is rather cheap when compared to the industry. G is cheaper than 87.80% of the companies in the same industry.
When comparing the Price/Earnings ratio of G to the average of the S&P500 Index (26.54), we can say G is valued rather cheaply.
A Price/Forward Earnings ratio of 11.25 indicates a reasonable valuation of G.
Compared to the rest of the industry, the Price/Forward Earnings ratio of G indicates a rather cheap valuation: G is cheaper than 86.59% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 35.28. G is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.51 | ||
| Fwd PE | 11.25 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, G is valued a bit cheaper than 78.05% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, G is valued cheaply inside the industry as 87.80% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.73 | ||
| EV/EBITDA | 9.72 |
4.3 Compensation for Growth
G's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of G may justify a higher PE ratio.
PEG (NY)1.21
PEG (5Y)1.33
EPS Next 2Y9.81%
EPS Next 3Y10.38%
5. Dividend
5.1 Amount
G has a Yearly Dividend Yield of 1.61%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.51, G pays a better dividend. On top of this G pays more dividend than 86.59% of the companies listed in the same industry.
G's Dividend Yield is slightly below the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.61% |
5.2 History
The dividend of G is nicely growing with an annual growth rate of 12.42%!
G has been paying a dividend for at least 10 years, so it has a reliable track record.
G has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)12.42%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
20.99% of the earnings are spent on dividend by G. This is a low number and sustainable payout ratio.
The dividend of G is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP20.99%
EPS Next 2Y9.81%
EPS Next 3Y10.38%
43.54
+1.82 (+4.36%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners95.66%
Inst Owner Change0.63%
Ins Owners0.93%
Ins Owner Change3.01%
Market Cap7.61B
Analysts76.67
Price Target52.45 (20.46%)
Short Float %4.32%
Short Ratio4.61
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.61% |
Yearly Dividend0.61
Dividend Growth(5Y)12.42%
DP20.99%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.57%
Min EPS beat(2)3.27%
Max EPS beat(2)3.86%
EPS beat(4)3
Avg EPS beat(4)2.18%
Min EPS beat(4)-2.08%
Max EPS beat(4)3.86%
EPS beat(8)7
Avg EPS beat(8)3.37%
EPS beat(12)11
Avg EPS beat(12)3.74%
EPS beat(16)15
Avg EPS beat(16)5.81%
Revenue beat(2)0
Avg Revenue beat(2)-0.86%
Min Revenue beat(2)-1.39%
Max Revenue beat(2)-0.34%
Revenue beat(4)2
Avg Revenue beat(4)-0.17%
Min Revenue beat(4)-1.39%
Max Revenue beat(4)0.88%
Revenue beat(8)3
Avg Revenue beat(8)-1.03%
Revenue beat(12)4
Avg Revenue beat(12)-0.89%
Revenue beat(16)7
Avg Revenue beat(16)-0.59%
PT rev (1m)1.51%
PT rev (3m)-7.6%
EPS NQ rev (1m)0.64%
EPS NQ rev (3m)-0.84%
EPS NY rev (1m)0.47%
EPS NY rev (3m)-1.88%
Revenue NQ rev (1m)0.48%
Revenue NQ rev (3m)-1.26%
Revenue NY rev (1m)0.54%
Revenue NY rev (3m)-2.26%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.51 | ||
| Fwd PE | 11.25 | ||
| P/S | 1.57 | ||
| P/FCF | 12.73 | ||
| P/OCF | 11.17 | ||
| P/B | 3.1 | ||
| P/tB | 10.05 | ||
| EV/EBITDA | 9.72 |
EPS(TTM)3.48
EY7.99%
EPS(NY)3.87
Fwd EY8.89%
FCF(TTM)3.42
FCFY7.86%
OCF(TTM)3.9
OCFY8.95%
SpS27.74
BVpS14.03
TBVpS4.33
PEG (NY)1.21
PEG (5Y)1.33
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.78% | ||
| ROE | 21.51% | ||
| ROCE | 17.69% | ||
| ROIC | 13.42% | ||
| ROICexc | 15.57% | ||
| ROICexgc | 29.9% | ||
| OM | 14.96% | ||
| PM (TTM) | 10.88% | ||
| GM | 35.51% | ||
| FCFM | 12.33% |
ROA(3y)10.38%
ROA(5y)8.98%
ROE(3y)22.97%
ROE(5y)21.04%
ROIC(3y)12.82%
ROIC(5y)11.64%
ROICexc(3y)15.47%
ROICexc(5y)14.31%
ROICexgc(3y)35.91%
ROICexgc(5y)36.08%
ROCE(3y)17.13%
ROCE(5y)15.64%
ROICexcg growth 3Y-10.54%
ROICexcg growth 5Y5.29%
ROICexc growth 3Y4.25%
ROICexc growth 5Y8.42%
OM growth 3Y5.04%
OM growth 5Y3.32%
PM growth 3Y5.47%
PM growth 5Y4.47%
GM growth 3Y-0.14%
GM growth 5Y0.36%
F-Score7
Asset Turnover0.99
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | 2.07 | ||
| Debt/EBITDA | 1.47 | ||
| Cap/Depr | 89.15% | ||
| Cap/Sales | 1.71% | ||
| Interest Coverage | 11.22 | ||
| Cash Conversion | 83.2% | ||
| Profit Quality | 113.4% | ||
| Current Ratio | 2.45 | ||
| Quick Ratio | 2.45 | ||
| Altman-Z | 3.92 |
F-Score7
WACC9.72%
ROIC/WACC1.38
Cap/Depr(3y)62.36%
Cap/Depr(5y)54.31%
Cap/Sales(3y)1.45%
Cap/Sales(5y)1.59%
Profit Quality(3y)93.94%
Profit Quality(5y)123.55%
High Growth Momentum
Growth
EPS 1Y (TTM)14.85%
EPS 3Y9.42%
EPS 5Y9.38%
EPS Q2Q%22.22%
EPS Next Y10.34%
EPS Next 2Y9.81%
EPS Next 3Y10.38%
EPS Next 5YN/A
Revenue 1Y (TTM)6.48%
Revenue growth 3Y5.83%
Revenue growth 5Y6.25%
Sales Q2Q%6.65%
Revenue Next Year4.69%
Revenue Next 2Y5.58%
Revenue Next 3Y6.43%
Revenue Next 5YN/A
EBIT growth 1Y13.26%
EBIT growth 3Y11.16%
EBIT growth 5Y9.78%
EBIT Next Year17.96%
EBIT Next 3Y12.12%
EBIT Next 5YN/A
FCF growth 1Y26.25%
FCF growth 3Y-5.94%
FCF growth 5Y10.69%
OCF growth 1Y30.07%
OCF growth 3Y-3.94%
OCF growth 5Y7.54%