Winners And Losers Of Q1: Genpact (NYSE:G) Vs The Rest Of The Business Process Outsourcing & Consulting Stocks
The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let's take a look at how Genpact (NYSE:G) and the rest of the business process outsourcing & consulting stocks fared in Q1.
The sector stands to benefit from ongoing digital transformation, increasing corporate demand for cost efficiencies, and the growing complexity of regulatory and cybersecurity landscapes. For those that invest wisely, AI and automation capabilities could emerge as competitive advantages, enhancing process efficiencies for the companies themselves as well as their clients. On the flip side, AI could be a headwind as well as the technology could lower the barrier to entry in the space and give rise to more self-service solutions. Additional challenges in the years ahead could include wage inflation for highly skilled consultants and potential regulatory scrutiny on outsourcing practices—especially in industries like finance and healthcare where who has access to certain data matters greatly.
The 7 business process outsourcing & consulting stocks we track reported a satisfactory Q1. As a group, revenues were in line with analysts' consensus estimates while next quarter's revenue guidance was 0.5% below.
In light of this news, share prices of the companies have held steady as they are up 3.5% on average since the latest earnings results.
Originally spun off from General Electric in 2005 to provide business process services, Genpact (NYSE:G) is a global professional services firm that helps businesses transform their operations through digital technology, AI, and data analytics solutions.
Genpact reported revenues of $1.21 billion, up 7.4% year on year. This print was in line with analysts' expectations, but overall, it was a slower quarter for the company as it lowered its full-year revenue and EPS guidance.
"We entered 2025 with strong momentum. Revenue in the first quarter grew 8% year-over-year with Data-Tech-AI revenue up 12%, on a constant currency basis, driving adjusted EPS growth of 16%. Looking ahead, our deep process and domain expertise remains a key competitive advantage as we partner with clients to optimize costs and accelerate transformation using AI and other advanced technologies," said Balkrishan "BK" Kalra, Genpact's President & CEO.
Genpact delivered the weakest full-year guidance update of the whole group. The stock is down 12.2% since reporting and currently trades at $43.51.
Read our full report on Genpact here, it's free.
Often retained for high-stakes matters with multibillion-dollar implications, CRA International (NASDAQ:CRAI) provides economic, financial, and management consulting services to corporations, law firms, and government agencies for litigation, regulatory proceedings, and business strategy.
CRA reported revenues of $181.9 million, up 5.9% year on year, outperforming analysts' expectations by 3%. The business had a very strong quarter with an impressive beat of analysts' EPS estimates and full-year revenue guidance slightly topping analysts' expectations.
CRA pulled off the biggest analyst estimates beat and highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 15.3% since reporting. It currently trades at $185.95.
Is now the time to buy CRA? Access our full analysis of the earnings results here, it's free.
With over 120 offices across 33 states and a team of more than 6,700 professionals, CBIZ (NYSE:CBZ) provides accounting, tax, benefits, insurance brokerage, and advisory services to help small and mid-sized businesses manage their finances and operations.
CBIZ reported revenues of $838 million, up 69.5% year on year, falling short of analysts' expectations by 2.6%. It was a slower quarter as it posted full-year revenue guidance missing analysts' expectations.
CBIZ delivered the fastest revenue growth but had the weakest performance against analyst estimates in the group. As expected, the stock is down 6.9% since the results and currently trades at $71.93.
Read our full analysis of CBIZ's results here.
With a team of experts deployed across 30+ countries to tackle complex business challenges, FTI Consulting (NYSE:FCN) is a global business advisory firm that helps organizations manage change, mitigate risk, and resolve disputes across financial, legal, operational, and regulatory matters.
FTI Consulting reported revenues of $898.3 million, down 3.3% year on year. This print came in 0.9% below analysts' expectations. More broadly, it was actually a strong quarter as it produced an impressive beat of analysts' EPS estimates.
FTI Consulting had the slowest revenue growth among its peers. The stock is flat since reporting and currently trades at $166.75.
Read our full, actionable report on FTI Consulting here, it's free.
Founded in 2002 during a time of significant regulatory change in corporate America, Huron Consulting Group (NASDAQ:HURN) is a professional services company that helps organizations develop growth strategies, optimize operations, and implement digital transformation solutions.
Huron reported revenues of $404.1 million, up 11.2% year on year. This number topped analysts' expectations by 0.8%. Overall, it was a strong quarter as it also logged a solid beat of analysts' EPS estimates and a narrow beat of analysts' full-year EPS guidance estimates.
The stock is up 10% since reporting and currently trades at $149.50.
Read our full, actionable report on Huron here, it's free.
As a result of the Fed's rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed's 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump's victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
Want to invest in winners with rock-solid fundamentals? Check out our Top 6 Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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