Caesars Entertainment misses Q2 earnings expectations, shares edge lower
On Friday, JPMorgan analyst Tien-tsin Huang adjusted the price target for Globant S.A. (NYSE: GLOB) shares, reducing it to $242.00 from the previous $248.00, while retaining an Overweight rating on the stock. According to InvestingPro data, six analysts have recently revised their earnings estimates downward, with analyst targets ranging from $140 to $280. The revision follows the company’s fourth-quarter 2024 earnings report, which aligned with expectations after adjusting for adverse foreign exchange effects. However, the 2025 revenue outlook fell short of what was anticipated, a factor likely to affect investor sentiment toward the stock.
Globant’s guidance for 2025 indicates sales between $2,635 million and $2,705 million, suggesting an organic year-over-year growth of around 10% at the midpoint. This follows the company’s impressive 15.26% revenue growth over the last twelve months, reaching $2.42 billion. This growth rate is still considerably higher than that of its peers, EPAM and DAVA. InvestingPro subscribers can access detailed peer comparison analysis and 8 additional key insights about Globant’s growth prospects. Despite this, the company’s year-over-year growth did not meet the higher expectations of some investors. Management has noted a significant growth in the pipeline size, yet there has been no corresponding acceleration in the conversion and delivery of this pipeline.
The lower end of Globant’s guidance assumes a downturn in the Latin American market, while the higher end is contingent on an uptick in the U.S. market and deals related to artificial intelligence. Up until now, Globant has secured many smaller deals but has yet to land substantial large contracts.
Amidst these updates, Globant’s stock is projected to face a double-digit percentage drop. Trading at a P/E ratio of 54x and an EV/EBITDA multiple of 25.7x, this decline would position the company at a 10% discount to Accenture (NYSE:ACN) on near-term market estimates, compared to Globant’s slight premium over the past year. Based on InvestingPro’s comprehensive Fair Value analysis, Globant currently appears slightly undervalued, despite maintaining a GOOD overall financial health score. JPMorgan suggests that there is potential for an upside should discretionary spending improve moving forward.
In summary, while JPMorgan has lowered the price target for Globant, the firm maintains an Overweight rating, indicating a belief in the company’s premium growth despite the mixed financial outlook and current market challenges.
In other recent news, Globant S.A. reported its fourth-quarter earnings, revealing an adjusted earnings per share of $1.75, which exceeded analyst expectations of $1.73. The company’s revenue for the quarter increased by 10.6% year-over-year to $642.5 million, though it fell short of the consensus forecast of $645.44 million. Despite achieving record revenue, Globant’s guidance for the upcoming first quarter and full year 2025 was weaker than anticipated. For the first quarter of 2025, the company expects adjusted EPS to range between $1.55 and $1.63, with revenue projected between $618 million and $628 million. This is below the analyst estimates of $1.65 EPS and $637 million in revenue. The full-year 2025 guidance also disappointed, with projected adjusted EPS of $6.80 to $7.20 and revenue between $2.635 billion and $2.705 billion, compared to analyst expectations of $7.34 EPS and $2.746 billion in revenue. Despite management’s positive outlook on maintaining momentum, the company’s growth trajectory has raised concerns among investors.
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