Earnings Beat: Genpact Limited Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

It's been a sad week for Genpact Limited (NYSE:G), who've watched their investment drop 15% to US$42.46 in the week since the company reported its quarterly result. Genpact reported US$1.2b in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$0.73 beat expectations, being 6.8% higher than what the analysts expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

Our free stock report includes 1 warning sign investors should be aware of before investing in Genpact. Read for free now.

Taking into account the latest results, Genpact's eleven analysts currently expect revenues in 2025 to be US$4.95b, approximately in line with the last 12 months. Statutory per-share earnings are expected to be US$3.00, roughly flat on the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$5.08b and earnings per share (EPS) of US$3.09 in 2025. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the minor downgrade to earnings per share expectations.

Check out our latest analysis for Genpact

The consensus price target fell 7.3% to US$52.03, with the weaker earnings outlook clearly leading valuation estimates. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Genpact at US$56.00 per share, while the most bearish prices it at US$48.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. It's pretty clear that there is an expectation that Genpact's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 2.7% growth on an annualised basis. This is compared to a historical growth rate of 5.9% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.9% annually. Factoring in the forecast slowdown in growth, it seems obvious that Genpact is also expected to grow slower than other industry participants.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have estimates - from multiple Genpact analysts - going out to 2027, and you can see them free on our platform here.

Even so, be aware that Genpact is showing 1 warning sign in our investment analysis , you should know about...

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.