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CHICAGO - Alight Inc. (NYSE:ALIT), a prominent provider of cloud-based human capital and technology-enabled services, outlined its mid-term financial goals and strategic direction during an investor day held this week. Currently trading near its 52-week low of $5.87, with a market capitalization of $3.2 billion, InvestingPro analysis suggests the stock is currently undervalued. The company, which serves a global clientele including some of the world’s most complex organizations, aims to harness its technology platform to drive innovation and enhance financial performance.
CEO Dave Guilmette expressed confidence in Alight’s market position and its potential for long-term growth, citing the company’s commitment to delivering value to shareholders. This commitment is evidenced by management’s aggressive share buyback program, as noted by InvestingPro. According to the financial targets presented, Alight anticipates an annual revenue growth rate of 4-6% by 2027, with an adjusted EBITDA margin of approximately 30%. While the company currently reports an EBITDA of $305 million and maintains a healthy current ratio of 1.42, it forecasts generating roughly $1 billion in cumulative free cash flow between 2025 and 2027.
The event also featured discussions with Alight clients and third-party evaluators, focusing on the company’s role in supporting employee wellbeing and financial security through its services. The insights gathered from these panels highlighted evolving market trends and client needs, reinforcing Alight’s strategic approach.
Alight emphasized that it does not provide reconciliations for forward-looking non-GAAP measures due to the impracticality of forecasting certain GAAP measures, which could significantly impact future results. The company’s forward-looking statements are based on current expectations and involve risks and uncertainties that could cause actual results to differ materially.
The investor day presentation and a video replay are available on Alight’s investor relations website, offering stakeholders a comprehensive overview of the company’s vision and financial projections.
This article is based on a press release statement from Alight Solutions, and it reflects the company’s current expectations and projections for its business operations and financial performance. While analysts predict profitability this year, investors seeking deeper insights can access comprehensive analysis, including 6 additional ProTips and detailed financial metrics, through InvestingPro’s extensive research report. The information presented is subject to change and should be considered in the context of the risks and uncertainties inherent in forward-looking statements.
In other recent news, Alight Solutions reported fourth-quarter earnings that fell slightly below expectations, prompting DA Davidson to maintain its Buy rating with a $10 price target. Despite the earnings miss, Alight’s management provided guidance for 2025, projecting an adjusted EBITDA increase of 4% to 9%, bolstered by a restructuring program anticipated to save $55 million annually. In a related development, Alight announced significant changes to its Board of Directors, appointing Russell Fradin as the new Chairman, alongside new board members Robert Schriesheim, Robert Lopes, Jr., and Mike Hayes. The board changes are part of a collaboration with Starboard Value, LP, Alight’s largest shareholder, aiming to enhance leadership and oversight.
Additionally, Alight declared a quarterly cash dividend of $0.04 per share on its Class A Common Stock, scheduled for payment in March 2025. This dividend declaration underscores the company’s commitment to delivering value to its shareholders. Meanwhile, JPMorgan has maintained a Neutral rating on Alight Solutions, with an $8 price target, citing a conservative outlook on revenue growth due to slower-than-expected discretionary spending recovery in the IT Services sector. Despite this cautious stance, JPMorgan expects Alight to achieve its growth targets by 2026, with further insights anticipated at the company’s first-quarter investor day in 2025.
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