Genpact Limited G stock has had an impressive run in the past six months. Shares of the company have gained 36.1%, outperforming 23.4% growth of the industry it belongs to and the 7.1% rise in the Zacks S&P 500 Composite in the said period.

Genpact reported impressive third-quarter 2024 results. Quarterly EPS of 85 cents surpassed the consensus estimate by 6.3% and grew 11.8% year over year. Revenues of $1.21 billion beat the consensus mark by 2% and increased 6.6% from the year-ago quarter.

How is Genpact Doing?

G is a dominant name in the Business Process Outsourcing services market. It is a leading provider of industry-specific solutions for industrial Internet of Things, user experience, order and supply chain management, data engineering, digital content management, risk management, direct procurement and logistics services, aftermarket services support, industrial asset optimization, and engineering services.

The company focuses on integrating process, analytics and digital technologies with domain expertise, which help it win customers on a regular basis. We believe that customer base expansion, tight cost control, strategic buyouts and aggressive share repurchase will fuel growth in the long run.

AI presents a significant growth opportunity for Genpact. The company’s Digital Smart Enterprise Processes (Digital SEPs) is a patented method of enhancing clients’ performances in business processes.  Digital SEPs improve the process quality using AI, advanced domain-specific digital technologies, Lean Six Sigma methodologies and experience-centric principles.

Buyouts like Rage Framework and design thinking-based companies, such as Tandem Seven, have expanded G’s AI product portfolio. Genpact Cora is an automation to AI-based platform that combines the proprietary automation, analytics and AI technologies of the company under an umbrella, and boosts clients’ digital transformations.

We are impressed with Genpact’s endeavors in returning value to shareholders in the forms of share repurchases and dividend payments. During 2021, 2022 and 2023, the company repurchased shares worth $298.2 million, $214.1 million and $225.4 million, respectively. It paid out $80.5 million, $91.8 million and $100 million in dividends to its shareholders in 2021, 2022 and 2023, respectively. Such shareholder-friendly strategies show the company’s commitment to create value for shareholders and underline its confidence in its business.

G's current ratio at the end of third-quarter 2024 was 1.85, higher than the industry average of 1.08. A current ratio of more than 1 often indicates that the company will easily pay off its short-term obligations.

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G’s Zacks Rank & Other Stocks to Consider

Genpact carries a Zacks Rank #2 (Buy) at present.

Some other top-ranked stocks in the broader Zacks Business Services sector are AppLovin APP and Climb Global Solutions, Inc. CLMB.

AppLovin currently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

APP has a long-term earnings growth expectation of 20%. It delivered a trailing four-quarter earnings surprise of 26.2%, on average.

Climb Global Solutions flaunts a Zacks Rank of 1 at present. It has a long-term earnings growth expectation of 16%.

CLMB delivered a trailing four-quarter earnings surprise of 51.1%, on average.

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