Genpact Ltd - $G - Earnings Analysis: Strong revenue growth driven by Data-Tech-AI and Digital Operations.
Business Model
Genpact generates revenue through providing advanced technology services and solutions to clients.
Revenue Sources
- Data-Tech-AI net revenues (47% of total revenue in 2024)
- Digital Operations net revenues (53% of total revenue in 2024)
Revenue Distribution by Channel
- Priority accounts contributed 63% of total revenue for the year 2024
Income Statement Analysis
- Net revenues increased by 8.9% year-over-year.
- Income from operations increased by 16.8% year-over-year.
- Net income decreased significantly by 51.3% year-over-year.
Balance Sheet Analysis
- Total assets increased by 3.8%.
- Total equity increased by 6.3%.
- Total liabilities increased by 1.6%
Cash Flow Analysis
- Net cash provided by operating activities increased significantly by 25.4%.
- Net cash used for investing activities increased by 34.2%
- Net cash used for financing activities decreased by 12.0%
- Cash and cash equivalents at the end of the period increased by 11.1%.
Capital Allocation
Genpact's capital allocation strategy includes returning at least 50% of cash flow to investors through share repurchases and dividends, while maintaining flexibility for strategic investments. The Board approved an 11% increase in the quarterly dividend to $0.17 per share and a $500 million increase to the share repurchase authorization.
Management Commentary
Revenue in Q4 reached $1,250,000,000 up 9% year over year.
Adjusted diluted EPS grew 10% year over year, faster than revenue for the fourth year in a row.
2025 will be a year of accelerated innovation for Genpact and we feel good about our momentum as we enter the year.
Overall Sentiment: Positive, with a focus on innovation, growth, and efficiency.
Recommendation
Rating: Hold
Reason for Rating: The company shows solid growth in revenue and strong cash flow, but net income decreased significantly. A hold rating is appropriate until the reasons for the net income decrease are better understood.
Disclaimer: This report is for informational purposes only and not investment advice. The analysis is based on limited information and subject to change. Investing in securities involves risks, including potential loss of principal. Past performance doesn't guarantee future results. Always conduct your own research, understand the risks, and consult a financial professional before making investment decisions.
Generated on: 2/7/2025, 1:33:42 PM