G - Embedded Expectations Analysis - 2021 04 12
Genpact Limited (G:USA) currently trades near historical averages relative to Uniform earnings, with an 18.2x Uniform P/E. At these levels, the market has bearish expectations for the firm, and management may be concerned about supply chain services investments, pandemic-driven growth opportunities, and the potential of their Enquero acquisitionSpecifically, management may lack confidence in their ability to sustain revenue and pipeline growth, further secure inorganic supply chain services investments, and mitigate rising operating expenses. Furthermore, they may have concerns about the potential of their LIVEKINDLY partnership in the food industry and Enquero acquisition. Moreover, management may lack confidence in their ability to source large transformation services clients, capitalize on growth opportunities stemming from the virtualization of technology services, and leverage digital technologies for clinical trial submissions for vaccines. They may also be concerned about the impact of European impairment charges on margins, workplace culture for a distributed workforce, and their progress executing their share buyback program. Finally, management may lack confidence in their ability to minimize their capex, maintain bookings backlog consistency, and meet top- and bottom-line guidance
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- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
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