Valens Equity Weekly Insights - 2023 06 27
ExlService (EXLS) is using AI to become one of the highest growth, most profitable BPOs. Uniform Accounting highlights that the market is significantly mispricing the company's future growth potential, signaling the potential for equity upside.With companies looking to outsource more of their operations and adopt more technology solutions, ExlService is well positioned to grow as its clients look to outsource more of their businesses. The company uses industry specific technology to develop strong moats within niches like insurance and banking, giving it the ability to scale quickly and grow returns. The market seems to be missing just how sustainable Exl's growth and Uniform ROA are, suggesting the company should be able to outperform the market's expectations.
Exl's management is closely aligned to focus on growing the business, which gives us more
confidence that the market misunderstands the company's future growth potential.
Management confidence in the Q1 earnings call about its growth, profitability, and continued value proposition to clients suggest management is executing on the company's
growth strategy, and the business is holding up well considering current economic conditions.
EXLS
ExlService Holdings is a holding company. Through its subsidiaries, the company is an operations management and analytics company. The company's operations management services involve the transfer to the company's business operations of a client such as claims processing, clinical operations, or financial transaction processing, after which the company administers and manages those operations for its client on an ongoing basis, or in case of consulting, consulting services related to transformation services, including digital transformation services. The company's Analytics services focus on driving business outcomes for its customers by generating data-driven insights across various parts of its customers' business.
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