Genpact Limited (G) Hits Fresh High: Is There Still Room to Run?

Core Insights - Genpact's shares have increased by 13.5% over the past month, reaching a new 52-week high of $38.37, and have gained 10.1% since the start of the year, outperforming the Zacks Business Services sector and the Zacks Outsourcing industry [1] Financial Performance - Genpact has consistently exceeded earnings expectations, reporting an EPS of$ 0.79 against a consensus estimate of $0.73 in its last earnings report on August 8, 2024, and beating revenue estimates by 2.64% [2] - For the current fiscal year, Genpact is projected to achieve earnings of$ 3.07 per share on revenues of $4.67 billion, reflecting a 3.02% increase in EPS and a 4.39% increase in revenues [2] - The next fiscal year forecasts earnings of$ 3.35 per share on $4.97 billion in revenues, indicating a year-over-year change of 9.07% in EPS and 6.3% in revenues [2] Valuation Metrics - Genpact's current valuation metrics show it trading at 12.5X current fiscal year EPS estimates, below the peer industry average of 16.7X, and at 12.2X on a trailing cash flow basis compared to the peer group's average of 12.5X [4] - The stock has a PEG ratio of 1.49, which does not place it among the top tier of stocks from a value perspective [4] Zacks Rank - Genpact holds a Zacks Rank of 2 (Buy), supported by rising earnings estimates, which aligns with the recommendation for investors to select stocks with a Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B [5] - The company has a Value Score of A, with Growth and Momentum Scores of B, resulting in a combined VGM Score of A, indicating strong potential for future performance [3][5]