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Reasons Why You Should Invest in Genpact Limited Stock Now

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Genpact Limited (G - Free Report) is a well-performing stock, with a significant price rise over the past six months and strong fundamentals. Therefore, if you haven’t taken advantage of the price appreciation yet, it’s time you added the stock to your portfolio, as we believe that it has the potential to carry the momentum in the near term.

Why is Genpact an Attractive Pick?

Share Price Appreciation: A glance at the company’s price trend reveals that the stock has had an impressive run over the past six months. G has returned 31%, which compared favorably with the industry's 17% rally and the Zacks S&P 500 composite’s 3.5% rise.

Solid Rank & VGM Score: Genpact currently carries a Zacks Rank #2 (Buy) and has a VGM Score of B. Our research shows that stocks with a VGM Score of A or B, combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities for investors. Thus, the company appears to be a compelling investment proposition at the moment.

Positive Earnings Surprise History: Genpact has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering a positive average earnings surprise of 7.8%.

Strong Growth Prospects: The Zacks Consensus Estimate for the company’s 2024 earnings of $3.23 indicates year-over-year growth of 8.4%. Earnings are expected to register 6.6% growth in 2025. The stock has a long-term expected earnings per share growth rate of 9.8%.

Growth Drivers: Genpact is a prominent BPO services provider, excelling in business analytics, digital, and consulting solutions. Its domain expertise spans Industrial IoT, supply chain management, digital content, and AI-driven services, supporting consistent revenue growth at a 5% CAGR from 2019 to 2023. We expect a 6.6% revenue increase in 2024, driven by innovative offerings like Digital Smart Enterprise Processes (SEPs) and the AI-powered Genpact Cora platform, enhancing efficiency and digital transformation for clients.

Committed to shareholder value, Genpact has steadily increased dividends, with payouts reaching $100 million in 2023, alongside significant share repurchases. Its robust liquidity is backed by a $1 billion cash balance against $426 million in current debt, maintaining a strong current ratio of 1.85, well above the industry average. This financial strength positions Genpact to capitalize on AI advancements while ensuring operational stability and sustained returns for investors.

Other Stocks to Consider

Some other top-ranked stocks from the broader Zacks Business Services sector are Fiserv (FI - Free Report) and Paychex (PAYX - Free Report) , each carrying a Zacks Rank of 2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Fiserv has a long-term earnings growth expectation of 14.9%. FI delivered a trailing four-quarter earnings surprise of 3.1%, on average.

Paychex has a long-term earnings growth expectation of 7.3%. PAYX delivered a trailing four-quarter earnings surprise of 1.7%, on average.


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Paychex, Inc. (PAYX) - free report >>

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