Genpact Profitability Analysis

G
 Stock
  

USD 48.32  0.21  0.44%   

For Genpact profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Genpact to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Genpact utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Genpact's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Genpact over time as well as its relative position and ranking within its peers. Please check Risk vs Return Analysis.
  
The current year Price to Sales Ratio is expected to grow to 2.50, whereas Return on Sales is forecasted to decline to 0.12. As of August 14, 2022, Accumulated Other Comprehensive Income is expected to decline to about (598.1 M). In addition to that, Consolidated Income is expected to decline to about 343.7 M.

Genpact Revenues

3.69 Billion

Is Genpact's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Genpact. If investors know Genpact will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Genpact listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
-0.28
Market Capitalization
8.9 B
Quarterly Revenue Growth YOY
0.1
Return On Assets
0.0674
Return On Equity
0.19
The market value of Genpact is measured differently than its book value, which is the value of Genpact that is recorded on the company's balance sheet. Investors also form their own opinion of Genpact's value that differs from its market value or its book value, called intrinsic value, which is Genpact's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Genpact's market value can be influenced by many factors that don't directly affect Genpact's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Genpact's value and its price as these two are different measures arrived at by different means. Investors typically determine Genpact value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Genpact's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Genpact Return On Asset vs. Price to Book Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Genpact's current stock value. Our valuation model uses many indicators to compare Genpact value to that of its competitors to determine the firm's financial worth.
Genpact is one of the top stocks in price to book category among related companies. It is one of the top stocks in return on asset category among related companies reporting about  1.42  of Return On Asset per Price to Book. As of August 14, 2022, Average Assets is expected to decline to about 4.5 B. In addition to that, Tangible Asset Value is expected to decline to about 2.8 B. Comparative valuation analysis is a catch-all model that can be used if you cannot value Genpact by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Genpact's Stock . Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Genpact's earnings, one of the primary drivers of an investment's value.

Genpact Return On Asset vs. Price to Book

Price to Book (P/B) ratio is used to relate a company book value to its current market price. A high P/B ratio indicates that investors expect executives to generate more returns on their investments from a given set of assets. Book value is the accounting value of assets minus liabilities.
Genpact 
P/B 
 = 
MV Per Share 
BV Per Share 
4.65 X
Price to Book ratio is mostly used in financial services industries where assets and liabilities are typically represented by dollars. Although low Price to Book ratio generally implies that the firm is undervalued, it is often a good indicator that the company may be in financial or managerial distress and should be investigated more carefully.
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.
Genpact 
Return on Asset 
 = 
Net Income 
Total Assets 
X
100 
6.59 %
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.

Genpact Return On Asset Comparison

Genpact is currently under evaluation in return on asset category among related companies.

Genpact Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Genpact, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Genpact will eventually generate negative long term returns. The profitability progress is the general direction of Genpact's change in net profit over the period of time. It can combine multiple indicators of Genpact, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for 2022
Accumulated Other Comprehensive Income-554.4 M-598.1 M
Consolidated Income369.4 M343.7 M
Net Income369.4 M342.9 M
Net Income Common Stock369.4 M342.9 M
Net Income to Non Controlling Interests-684.9 K-702.9 K
Operating Income509 M468.7 M
Income Tax Expense113.7 M104.2 M
Genpact Limited provides business process outsourcing and information technology services in India, rest of Asia, North and Latin America, and Europe. The company was founded in 1997 and is based in Hamilton, Bermuda. Genpact operates under Information Technology Services classification in the United States and is traded on New York Stock Exchange. It employs 115300 people.

Genpact Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Genpact. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Genpact position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Genpact's important profitability drivers and their relationship over time.

Genpact Profitability Trends

Genpact profitability trend refers to the progression of profit or loss within a business. An upward trend means that Genpact's profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Genpact's gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.

Genpact Profitability Drivers Correlations

One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Genpact different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Genpact in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Genpact's future profitability.

Use Genpact in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Genpact position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Genpact will appreciate offsetting losses from the drop in the long position's value.

Genpact Pair Trading

Genpact Pair Trading Analysis

The ability to find closely correlated positions to Genpact could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Genpact when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Genpact - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Genpact to buy it.
The correlation of Genpact is a statistical measure of how it moves in relation to other equities. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Genpact moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Genpact moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Genpact can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your Genpact position

In addition to having Genpact in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

Run Defense Thematic Idea Now

Defense
Defense Theme
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Defense theme has 10 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Defense Theme or any other thematic opportunities.
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Please check Risk vs Return Analysis. Note that the Genpact information on this page should be used as a complementary analysis to other Genpact's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.

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When running Genpact price analysis, check to measure Genpact's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Genpact is operating at the current time. Most of Genpact's value examination focuses on studying past and present price action to predict the probability of Genpact's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Genpact's price. Additionally, you may evaluate how the addition of Genpact to your portfolios can decrease your overall portfolio volatility.
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To fully project Genpact's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Genpact at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Genpact's income statement, its balance sheet, and the statement of cash flows.
Potential Genpact investors and stakeholders can use historical trends found within financial statements to determine how well the company is positioned for the future. Although Genpact investors may work on each financial statement separately, they are all related. The changes in Genpact's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Genpact's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.