Genpact Limited ( G Quick Quote G - Free Report) performed well in the past year and has the potential to sustain the momentum. If you haven’t taken advantage of its share price appreciation yet, it’s time you add the stock to your portfolio.
Let’s take a look at the factors that make the stock an attractive pick.
An Outperformer: A glimpse at the company’s price trend reveals that its shares have increased 10.3% in the past year compared with a 6.6% rise of the Zacks S&P 500 composite. Image Source: Zacks Investment Research Solid Rank & VGM Score: Genpact currently carries a Zacks Rank #2 (Buy) and has a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities. Thus, the company seems to be an appropriate investment proposition at the moment. You can see the complete list of today’s Zacks #1 Rank stocks here. Positive Earnings Surprise History: Genpact has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in all of the trailing four quarters, delivering an earnings surprise of 15.1%, on average. Strong Growth Prospects: The Zacks Consensus Estimate for 2022 earnings is pegged at $2.67, which reflects year-over-year growth of 9.7%. G’s long-term expected earnings per share (EPS) growth rate is pegged at 14.8%. Driving Factors: Genpact’s liquidity position is impressive. The company’s current ratio (a measure of liquidity) at the end of third-quarter 2021 was 1.58 compared with 1.52 reported in second-quarter 2021.
We are impressed with Genpact’s endeavors to boost shareholders’ value in the form of share repurchases and dividend payouts. During 2020, 2019 and 2018, Genpact repurchased shares worth $137.1 million, $30 million and $154.1 million, respectively. The company paid out $74.2 million, $64.7 million and $57.1 million in dividends to shareholders during 2020, 2019 and 2018, respectively. These shareholder-friendly moves reflect on the company’s commitment to create value for shareholders and underline its confidence in its business.
Artificial Intelligence (AI) presents a significant growth opportunity for Genpact. The company’s Digital Smart Enterprise Processes (Digital SEPs) is a patented approach to enhance the performance of clients’ business processes. Further, Genpact Cora is an automation to AI-based platform that combines the company’s proprietary automation, analytics and AI technologies into a single common platform and accelerates clients’ digital transformations. The acquisitions of Rage Framework and design thinking-based companies, such as Tandem Seven, have expanded Genpact’s AI product portfolio. We believe that Genpact is well-positioned to take advantage of future improvements in the AI space.
Other Stocks to Consider
Investors interested in the broader Zacks
Business Services sector can also consider stocks like Avis Budget (. CAR Quick Quote CAR - Free Report) , Cross Country Healthcare ( CCRN Quick Quote CCRN - Free Report) and Accenture ( ACN Quick Quote ACN - Free Report)
Avis Budget has an expected earnings growth rate of around 9.4% for the current year. CAR has a trailing four-quarter earnings surprise of 76.9%, on average.
Avis Budget’s shares have surged 414.8% in the past year. It has a long-term earnings growth of 19.4%. CAR sports a Zacks #1 Rank.
CCRN has a trailing four-quarter earnings surprise of 75%, on average.
Cross Country Healthcare’s shares have surged 156.1% in the past year. It has a long-term earnings growth of 21.5%. CCRN sports a Zacks #1 Rank.
Accenture has an expected earnings growth rate of around 20% for the current year. It has a trailing four-quarter earnings surprise of 5.3%, on average.
Accenture’s shares have surged 44.3% in the past year. It has a long-term earnings growth of 10%. ACN sports a Zacks #1 Rank.