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On Monday, Mizuho (NYSE:MFG) Securities updated its outlook on Genpact Ltd . (NYSE:G), increasing the price target to $55.00, up from the previous $45.00, while maintaining a Neutral rating on the company’s shares. The stock has shown remarkable momentum, delivering a 52.9% return over the past year and currently trading near its 52-week high of $56.76. According to InvestingPro analysis, the company appears slightly undervalued based on its Fair Value calculations. The adjustment follows Genpact’s strong fourth-quarter results for 2024 and the company’s optimistic guidance for the fiscal year 2025, which surpassed expectations on both revenue and earnings fronts.
The improved forecast is largely attributed to the company’s higher-than-anticipated revenue growth in its Digital Operations segment, with overall revenue growing 6.48% in the last twelve months to $4.77 billion. Additionally, Genpact’s effective implementation of its "3+1" strategy, which includes expanding technological partnerships and a focus on GenAI, contributed to the positive outlook. The company maintains strong financial health with a current ratio of 2.16, indicating solid liquidity.
Despite the promising developments, Mizuho analysts highlight some concerns. The firm’s continued significant involvement in traditional Business Process Outsourcing (BPO) is seen as a potential risk in the medium term. Nevertheless, the analysts are encouraged by Genpact’s increased execution and progress, particularly in the area of GenAI, which is a suite of artificial intelligence solutions for businesses.
Based on these factors, Mizuho has revised upward its revenue and adjusted EPS estimates for 2025 and 2026. This revision underpins the new price target of $55. In their commentary, the analysts reiterate their Neutral stance, acknowledging the company’s achievements while remaining cautious about the longer-term implications of its current business mix. For deeper insights into Genpact’s valuation and growth prospects, including 16 additional ProTips and comprehensive financial analysis, visit InvestingPro to access the detailed Pro Research Report.
In other recent news, Genpact Ltd. has been the subject of several positive developments. Following a strong financial quarter, the company’s stock price target was raised to $58 by BMO Capital Markets, emphasizing the company’s consistent delivery of results surpassing expectations. Similarly, Needham maintained a Buy rating on Genpact and increased the price target to $65.00, highlighting the company’s strategic initiatives and growing demand.
Additionally, Genpact’s strong fourth-quarter earnings report, surpassing consensus expectations, resulted in an upgrade to ’Buy’ from TD Cowen. The company reported a fourth-quarter earnings per share (EPS) of $0.91 and revenue of $1.25 billion, with an optimistic guidance for the first quarter of 2025. TD Cowen analysts further upgraded Genpact’s stock rating from Hold to Buy, with a significant price target increase to $60.
BofA Securities also raised the price target for Genpact to $58.00, maintaining a Buy rating, indicating high visibility for achieving the higher end of the guidance range. These recent developments reflect confidence in Genpact’s ability to maintain its growth and capitalize on its investments in Data, AI, and Agentic Solutions.
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