Genpact (G) Stock Increases 5.1% Since Q2 Earnings Beat
Genpact Limited G reported mixed second-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed.
Adjusted EPS (excluding 9 cents from non-recurring items) of 72 cents outpaced the Zacks Consensus Estimate by 4.4% and grew 2.9% year over year. Revenues of $1,105.5 million lagged the consensus estimate by 0.7%. However, the top line climbed 1.5% year over year on a reported basis and 3% at constant currency (cc).
The earnings beat pleased investors as the stock has gained 5.1% since the date of earnings release on Aug 9.
Genpact Limited Price, Consensus and EPS Surprise
Genpact Limited price-consensus-eps-surprise-chart | Genpact Limited Quote
Quarterly Details
Data-Tech-AI services revenues (representing 45% of total revenues) were up 2% year over year on a reported basis and 3% at cc to $501 million. Yet, the metric missed our estimate of $502.1 million.
Digital Operations services revenues of $605 million (55%) inched up 1% year over year and 2% at cc. This also fell short of our projection of $612.7 million.
Adjusted income from operations totaled $186 million, up 2% year over year. Adjusted operating income margin of 16.8% plunged 10 basis points year over year.
Genpact exited the quarter with cash and cash equivalents of $646.8 million compared with $552.3 million recorded at the end of the previous quarter. Long-term debt reached $1.25 billion from $1.24 billion in the prior quarter.
The company generated $102.4 million in cash from operating activities, while capex was $10.2 million. Genpact returned $23 million to shareholders through dividends. G repurchased approximately 3.2 million of its common shares during the quarter for total consideration of $120 million at an average price per share of $37.68.
Dims 2023 Guidance
Revenues are anticipated to be between $4.59 billion and $4.64 billion (prior view: $4.64-$4.71 billion), the mid-point ($4.615 billion) of which is below the Zacks Consensus Estimate of $4.65 billion.
Adjusted EPS is projected in the range of $2.91-$2.94 (prior view: $2.92-$2.99). The mid-point ($2.925) of the guided range is below the Zacks Consensus Estimate of $2.94.
Adjusted income from operations margin is expected to be 16.8%.
Genpact currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Earnings Snapshots of Some Service Providers
Omnicom OMC reported mixed second-quarter 2023 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
OMC’s earnings of $1.81 per share beat the consensus estimate by 0.6% and climbed 7.7% year over year. Total revenues of $3.6 billion lagged the consensus estimate by 0.3% but inched up 1.2% year over year.
Equifax EFX reported mixed second-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate but revenues disappointed.
EFX’s adjusted earnings came in at $1.71 per share, outpacing the consensus mark by 2.4%. Yet, the bottom line tumbled 18.2% from the year-ago figure. Total revenues of $1.32 billion fell short of the consensus estimate by 0.4% but matched the prior-year figure on a reported basis.
Interpublic’s IPG second-quarter 2023 earnings surpassed the Zacks Consensus Estimate while revenues lagged the same.
IPG’s adjusted earnings reached 74 cents per share, outshining the Zacks Consensus Estimate by 23.3%. Nonetheless, the metric declined 17.5% on a year-over-year basis. Net revenues of $2.33 billion missed the consensus estimate by 2.9% and plunged 14.9% on a year-over-year basis. Total revenues of $2.67 billion decreased 2.6% year over year.
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