NYSE:G

Stock Analysis Report

Executive Summary

Genpact Limited provides business process outsourcing and information technology (IT) services North and Latin America, India, rest of Asia, and Europe.

Rewards

PE ratio (25.5x) is below the IT industry average (30.9x)

Earnings are forecast to grow 14.1% per year

Earnings have grown 7.8% per year over the past 5 years

Risk Analysis

Has a high level of debt



Snowflake Analysis

Adequate balance sheet with acceptable track record.


Similar Companies

Share Price & News

How has Genpact's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: G has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.8%

G

-1.7%

US IT

-1.4%

US Market


1 Year Return

42.8%

G

28.2%

US IT

14.5%

US Market

Return vs Industry: G exceeded the US IT industry which returned 28.2% over the past year.

Return vs Market: G exceeded the US Market which returned 14.5% over the past year.


Shareholder returns

GIndustryMarket
7 Day-0.8%-1.7%-1.4%
30 Day1.0%4.2%1.3%
90 Day-2.7%-1.9%4.6%
1 Year43.8%42.8%29.5%28.2%17.1%14.5%
3 Year73.4%69.1%96.8%88.4%45.1%35.7%
5 Year131.6%125.8%134.0%113.2%67.1%48.6%

Price Volatility Vs. Market

How volatile is Genpact's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Genpact undervalued compared to its fair value and its price relative to the market?

25.55x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: G ($40.59) is trading above our estimate of fair value ($10.23)

Significantly Below Fair Value: G is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: G is good value based on its PE Ratio (25.5x) compared to the IT industry average (30.9x).

PE vs Market: G is poor value based on its PE Ratio (25.5x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: G is poor value based on its PEG Ratio (1.8x)


Price to Book Ratio

PB vs Industry: G is overvalued based on its PB Ratio (4.8x) compared to the US IT industry average (3.7x).


Next Steps

Future Growth

How is Genpact forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

14.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: G's forecast earnings growth (14.1% per year) is above the savings rate (1.7%).

Earnings vs Market: G's earnings (14.1% per year) are forecast to grow slower than the US market (14.2% per year).

High Growth Earnings: G's earnings are forecast to grow, but not significantly.

Revenue vs Market: G's revenue (9.4% per year) is forecast to grow faster than the US market (7.4% per year).

High Growth Revenue: G's revenue (9.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: G's Return on Equity is forecast to be high in 3 years time (20.4%)


Next Steps

Past Performance

How has Genpact performed over the past 5 years?

7.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: G has high quality earnings.

Growing Profit Margin: G's current net profit margins (8.8%) are lower than last year (9.3%).


Past Earnings Growth Analysis

Earnings Trend: G's earnings have grown by 7.8% per year over the past 5 years.

Accelerating Growth: G's earnings growth over the past year (11.8%) exceeds its 5-year average (7.8% per year).

Earnings vs Industry: G earnings growth over the past year (11.8%) underperformed the IT industry 17%.


Return on Equity

High ROE: G's Return on Equity (18.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Genpact's financial position?


Financial Position Analysis

Short Term Liabilities: G's short term assets ($1.6B) exceed its short term liabilities ($1.1B).

Long Term Liabilities: G's short term assets ($1.6B) exceed its long term liabilities ($1.4B).


Debt to Equity History and Analysis

Debt Level: G's debt to equity ratio (76.6%) is considered high.

Reducing Debt: G's debt to equity ratio has increased from 65.6% to 76.6% over the past 5 years.

Debt Coverage: G's debt is well covered by operating cash flow (38.9%).

Interest Coverage: G's interest payments on its debt are well covered by EBIT (9.9x coverage).


Balance Sheet

Inventory Level: G has a low level of unsold assets or inventory.

Debt Coverage by Assets: G's debt is covered by short term assets (assets are 1.3x debt).


Next Steps

Dividend

What is Genpact's current dividend yield, its reliability and sustainability?

0.84%

Current Dividend Yield


Dividend Yield vs Market

company0.8%marketbottom25%1.4%markettop25%3.7%industryaverage1.3%forecastin3Years0.9%

Current dividend yield vs market & industry

Notable Dividend: G's dividend (0.84%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: G's dividend (0.84%) is low compared to the top 25% of dividend payers in the US market (3.71%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, G has been paying a dividend for less than 10 years.

Growing Dividend: G's dividend payments have increased, but the company has only paid a dividend for 3 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (20.8%), G's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: G's dividends in 3 years are forecast to be well covered by earnings (17.5% payout ratio).


Next Steps

Management

What is the CEO of Genpact's salary, the management and board of directors tenure and is there insider trading?

6.8yrs

Average management tenure


CEO

Tiger Tyagarajan (58yo)

8.5yrs

Tenure

US$22,299,191

Compensation

Mr. Nallicheri Vaidyanathan Tyagarajan, also known as Tiger, has been the Chief Executive Officer and President at Genpact Limited since June 17, 2011. Mr. Tyagarajan has been Chief Executive Officer and P ...


CEO Compensation Analysis

Compensation vs Market: Tiger's total compensation ($USD22.30M) is above average for companies of similar size in the US market ($USD6.81M).

Compensation vs Earnings: Tiger's compensation has increased by more than 20% in the past year.


Management Age and Tenure

6.8yrs

Average Tenure

52yo

Average Age

Experienced Management: G's management team is seasoned and experienced (6.8 years average tenure).


Board Age and Tenure

6.9yrs

Average Tenure

59yo

Average Age

Experienced Board: G's board of directors are considered experienced (6.9 years average tenure).


Insider Trading

Insider Buying: G insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$205,16602 Dec 19
Carol Lindstrom
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,000
Max PriceUS$41.03
SellUS$100,253,97727 Nov 19
Twickenham Investment Private Ltd.
EntityCompany
Shares2,514,837
Max PriceUS$39.87
SellUS$514,896,49927 Nov 19
Bain Capital, LP
EntityCompany
Shares12,916,004
Max PriceUS$39.87
SellUS$514,896,49927 Nov 19
Bain Capital, LP
EntityCompany
Shares12,916,004
Max PriceUS$39.87
SellUS$76,085,72019 Aug 19
Twickenham Investment Private Ltd.
EntityCompany
Shares1,878,196
Max PriceUS$40.51
SellUS$430,289,28019 Aug 19
Bain Capital, LP
EntityCompany
Shares10,621,804
Max PriceUS$40.51
SellUS$38,17605 Jun 19
Heather White
EntityIndividual
Role
Chief Legal Officer
Senior VP
Shares1,058
Max PriceUS$36.08
SellUS$54,008,01428 May 19
Twickenham Investment Private Ltd.
EntityCompany
Shares1,499,806
Max PriceUS$36.01
SellUS$306,091,98628 May 19
Bain Capital, LP
EntityCompany
Shares8,500,194
Max PriceUS$36.01
SellUS$252,98521 Feb 19
Heather White
EntityIndividual
Role
Chief Legal Officer
Senior VP
Shares7,680
Max PriceUS$32.94
SellUS$1,658,71121 Feb 19
Edward Fitzpatrick
EntityIndividual
Role
Chief Financial Officer
Senior VP & CFO
Shares50,213
Max PriceUS$33.03
SellUS$273,833,75020 Feb 19
Bain Capital, LP
EntityCompany
Shares8,500,194
Max PriceUS$32.22
SellUS$48,316,25019 Feb 19
Twickenham Investment Private Ltd.
EntityCompany
Shares1,499,806
Max PriceUS$32.22

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Tiger Tyagarajan (58yo)

    President

    • Tenure: 8.5yrs
    • Compensation: US$22.30m
  • Monty Singh (54yo)

    Global Business Leader of Capital Markets & IT Services

    • Tenure: 11.3yrs
    • Compensation: US$1.97m
  • Patrick Cogny (52yo)

    Global Business Leader of Hi-Tech

    • Tenure: 8.3yrs
    • Compensation: US$1.97m
  • Piyush Mehta (50yo)

    Chief HR Officer & Senior VP

    • Tenure: 18.9yrs
    • Compensation: US$2.14m
  • Darren Saumur (51yo)

    Senior VP & Global Operating Officer

    • Tenure: 1.7yrs
  • Roger Sachs

    Head of Investor Relations

    • Tenure: 0yrs
  • Heather White (46yo)

    Senior VP

    • Tenure: 1.7yrs
  • Ed Fitzpatrick (53yo)

    Senior VP & CFO

    • Tenure: 5.4yrs
    • Compensation: US$2.41m
  • Michael Schneider

    Vice President of Integrated Communications

    • Tenure: 0yrs
  • Vidya Rao

    Chief Information Officer

    • Tenure: 0.2yrs

Board Members

  • Mark Nunnelly (60yo)

    Independent Director

    • Tenure: 7.2yrs
    • Compensation: US$111.11k
  • Bob Scott (73yo)

    Non-Executive Chairman of the Board

    • Tenure: 8.8yrs
    • Compensation: US$542.01k
  • Mark Verdi (52yo)

    Independent Director

    • Tenure: 7.2yrs
    • Compensation: US$196.11k
  • Jim Madden (57yo)

    Independent Director

    • Tenure: 14.9yrs
    • Compensation: US$213.61k
  • Stacey Cartwright (55yo)

    Director

    • Tenure: 0.08yrs
  • CeCe Morken (61yo)

    Independent Director

    • Tenure: 3.8yrs
    • Compensation: US$196.11k
  • Tiger Tyagarajan (58yo)

    President

    • Tenure: 8.5yrs
    • Compensation: US$22.30m
  • Laura Conigliaro (74yo)

    Independent Director

    • Tenure: 6.6yrs
    • Compensation: US$196.11k
  • Ajay Agrawal (49yo)

    Independent Director

    • Tenure: 0.9yrs
  • Carol Lindstrom (65yo)

    Independent Director

    • Tenure: 3.5yrs
    • Compensation: US$191.11k

Company Information

Genpact Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Genpact Limited
  • Ticker: G
  • Exchange: NYSE
  • Founded: 1997
  • Industry: Data Processing and Outsourced Services
  • Sector: Software
  • Market Cap: US$7.570b
  • Shares outstanding: 189.96m
  • Website: https://www.genpact.com

Number of Employees


Location

  • Genpact Limited
  • Victoria Place
  • 5th Floor
  • Hamilton
  • HM 10
  • Bermuda

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
GNYSE (New York Stock Exchange)YesCommon StockUSUSDAug 2007
35GDB (Deutsche Boerse AG)YesCommon StockDEEURAug 2007

Biography

Genpact Limited provides business process outsourcing and information technology (IT) services North and Latin America, India, rest of Asia, and Europe. Its finance and accounting services include accounts ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/06 00:06
End of Day Share Price2019/12/05 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.