Last week, you might have seen that ExlService Holdings, Inc. (NASDAQ:EXLS) released its full-year result to the market. The early response was not positive, with shares down 3.5% to US$74.54 in the past week. Revenues were US$991m, approximately in line with expectations, although statutory earnings per share (EPS) performed substantially better. EPS of US$1.95 were also better than expected, beating analyst predictions by 11%. This is an important time for investors, as they can track a company's performance in its report, look at what top analysts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what analysts are expecting for next year.
After the latest results, the ten analysts covering ExlService Holdings are now predicting revenues of US$1.06b in 2020. If met, this would reflect a satisfactory 6.6% improvement in sales compared to the last 12 months. Statutory earnings per share are expected to leap 26% to US$2.49. Before this earnings report, analysts had been forecasting revenues of US$1.06b and earnings per share (EPS) of US$2.21 in 2020. Although the revenue estimates have not really changed, we can see there's been a solid gain to earnings per share expectations, suggesting that analysts have become more bullish after the latest result.
The consensus price target rose 7.9% to US$80.50, suggesting that higher earnings estimates flow through to the stock's valuation as well. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on ExlService Holdings, with the most bullish analyst valuing it at US$87.00 and the most bearish at US$63.00 per share. Still, with such a tight range of estimates, it suggests analysts have a pretty good idea of what they think the company is worth.
In addition, we can look to ExlService Holdings's past performance and see whether business is expected to improve, and if the company is expected to perform better than wider market. We would highlight that ExlService Holdings's revenue growth is expected to slow, with forecast 6.6% increase next year well below the historical 13%p.a. growth over the last five years. Compare this against other companies (with analyst forecasts) in the market, which are in aggregate expected to see revenue growth of 11% next year. So it's pretty clear that, while revenue growth is expected to slow down, analysts still expect the wider market to grow faster than ExlService Holdings.
The Bottom Line
The biggest takeaway for us from these new estimates is that the consensus upgraded its earnings per share estimates, showing a clear improvement in sentiment around ExlService Holdings's earnings potential next year. Fortunately, analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations - although our data does suggest that ExlService Holdings's revenues are expected to perform worse than the wider market. Analysts also upgraded their price target, suggesting that analysts believe the intrinsic value of the business is likely to improve over time.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for ExlService Holdings going out to 2021, and you can see them free on our platform here..
Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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