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Capgemini Se Unsponsored ADR (CGEMY)
OTHER OTC:CGEMY
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Capgemini
(OTC:CGEMY)
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Rating:69Neutral
Price Target:
$33.00
▲(7.11% Upside)
Capgemini's solid financial performance and attractive valuation are offset by mixed earnings call results and bearish technical indicators. The company's stability and strategic wins in high-value services are positive, but challenges in profitability and market conditions weigh on the score.
Positive Factors
Strategic Wins in High-Value Services
Securing significant contracts in high-value areas like cloud and finance transformation enhances Capgemini's competitive positioning and long-term growth prospects by expanding its footprint in lucrative markets.
Strong Demand for Cloud, Data, and AI
The robust demand for cloud, data, and AI services positions Capgemini well for sustained growth, as these technologies are critical to digital transformation efforts across industries.
Improved Balance Sheet Health
A stronger equity position and improved debt-to-equity ratio indicate enhanced financial stability, providing Capgemini with greater flexibility to invest in growth opportunities.
Negative Factors
Decline in Net Profit
A decline in net profit impacts Capgemini's ability to reinvest in its business and may pressure its capacity to sustain dividends, affecting long-term shareholder value.
Weakness in Manufacturing Sector
Continued weakness in the manufacturing sector could limit Capgemini's growth in this key vertical, affecting its overall revenue diversification and stability.
Challenging Pricing Environment
Pricing pressures can erode margins, challenging Capgemini's profitability and potentially limiting its ability to invest in new technologies and services.
Capgemini (CGEMY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$29.75B
Dividend Yield2.33%
Average Volume (3M)8.98K
Price to Earnings (P/E)17.6
Beta (1Y)0.96
Revenue Growth-0.20%
EPS Growth-6.50%
CountryUS
Employees341,118
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)1.38
Shares Outstanding856,737,370
10 Day Avg. Volume0
30 Day Avg. Volume8,976
Financial Highlights & Ratios
PEG Ratio17.22
Price to Book (P/B)2.27
Price to Sales (P/S)1.21
P/FCF Ratio12.07
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue1.34
Enterprise Value/Gross Profit4.91
Enterprise Value/Ebitda9.31
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Capgemini Business Overview & Revenue Model
Company DescriptionCapgemini (CGEMY) is a global leader in consulting, technology services, and digital transformation. With a presence in over 50 countries, the company operates across various sectors including financial services, manufacturing, public sector, and consumer products. Capgemini offers a wide range of services such as application development, IT infrastructure management, cloud services, and cybersecurity, alongside innovative solutions in artificial intelligence and analytics.
How the Company Makes MoneyCapgemini generates revenue primarily through its consulting and professional services, where it charges clients for project-based work and long-term contracts. The company has multiple key revenue streams, including IT services, cloud solutions, and business transformation projects. Additionally, Capgemini benefits from recurring revenue through managed services and maintenance contracts. Significant partnerships with leading technology firms like Microsoft, Salesforce, and SAP further enhance its offerings and market reach, contributing to its overall earnings. The company also engages in strategic acquisitions to expand its capabilities and client base, which plays a vital role in its revenue growth.
Capgemini Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Feb 13, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with positive developments in revenue growth, bookings, and strategic wins in key sectors and regions. However, these were counterbalanced by declines in net profit, manufacturing sector weakness, and challenges in Europe, alongside increased restructuring costs and pricing pressure.Q2-2025 Updates
Positive Updates
Positive Revenue Growth in Q2
Capgemini returned to positive constant currency growth in Q2 2025 at plus 0.7% year-on-year, with H1 revenue reaching EUR 1.107 billion, up 0.2% year-on-year.
Strong Bookings and Solid Commercial Momentum
Bookings totaled EUR 11.993 billion in H1 2025, representing a 2.1% year-on-year increase, with a book-to-bill ratio of 1.08.
Regional Growth Highlights
Growth rates in the U.K. and Ireland, North America, Asia Pacific, and Latin America accelerated, particularly driven by financial services and TMT sectors.
High-Value Service Offering and Strategic Wins
Capgemini secured significant contracts in cloud services, aerospace, and finance transformation, showcasing strong traction for their high-value service offering.
Strong Demand for Cloud, Data, and AI
Capgemini experienced strong demand for cloud, data, and AI services, with Gen AI and Agentic AI contributing to over 7% of Q2 bookings.
Negative Updates
Decline in Net Profit and Basic EPS
Net profit group share decreased to EUR 724 million compared with EUR 835 million in H1 last year, and basic EPS was down 13% year-on-year.
Decline in Manufacturing Sector
The manufacturing sector remained weak in Q2 at minus 4% year-on-year.
Revenue Decline in France and Rest of Europe
Revenues in France and the rest of Europe declined by minus 5% and minus 2.3%, respectively.
Headcount Fluctuations and Increased Restructuring Costs
Total headcount increased by 4% year-on-year, with restructuring costs higher in H1 2025 at EUR 136 million compared to EUR 53 million in H1 2024.
Challenging Pricing Environment
The competitive market and client expectations for cost savings are putting pressure on gross margins.
Company Guidance
During the H1 2025 results call, Capgemini's CEO Aiman Ezzat highlighted several key metrics that reflect the company's performance and outlook. Capgemini reported a slight year-on-year revenue growth of 0.2% for H1 2025, reaching EUR 11.107 billion, and returned to positive constant currency growth in Q2 at 0.7% year-on-year. Bookings for the period totaled EUR 11.993 billion, representing a 2.1% increase year-on-year, with a solid book-to-bill ratio of 1.08. The operating margin remained stable at 12.4% of revenues, equivalent to EUR 1.377 billion. Despite a challenging economic environment, Capgemini maintained a normalized EPS of EUR 6, up 2% year-on-year, and generated an organic free cash flow of EUR 60 million. The company expects constant currency revenue growth for the full year to range between minus 1% and plus 1%, with M&A contributing around 1 point to growth. The operating margin target is set at 13.3% to 13.5%, and the organic free cash flow objective remains at approximately EUR 1.9 billion.Capgemini Financial Statement Overview
Summary
Capgemini shows stable profitability with consistent margins and strong equity position. However, limited growth in free cash flow suggests constraints in cash generation expansion.Income Statement
Capgemini demonstrates stable profitability with a consistent gross profit margin of around 27% and a net profit margin of approximately 7.5% over the years. The revenue growth has been steady, with a notable increase from 2020 to 2021 by 14.6%, although the growth rate has slowed in recent years. The EBIT and EBITDA margins are strong, reflecting efficient operations.Balance Sheet
The company maintains a reasonable debt-to-equity ratio, improving from 1.48 in 2020 to 0.52 in 2024, indicating a stronger equity position. The return on equity has been robust, reaching 14.2% in 2024, showing effective management of shareholder funds. The equity ratio has improved, reflecting a healthy balance sheet despite the industry’s capital intensity.Cash Flow
Capgemini's cash flow statements reveal consistent free cash flow generation, with a free cash flow to net income ratio exceeding 100% over the years, indicating strong cash profitability. Operating cash flow to net income ratio also supports efficient cash generation from operations, although free cash flow growth has been minimal, suggesting limited expansion in cash generation.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 22.07B | 22.10B | 22.52B | 22.00B | 18.16B | 15.85B |
| Gross Profit | 6.01B | 6.05B | 6.05B | 5.83B | 4.79B | 4.14B |
| EBITDA | 3.17B | 3.23B | 3.19B | 3.14B | 2.53B | 2.18B |
| Net Income | 1.56B | 1.67B | 1.66B | 1.55B | 1.16B | 957.00M |
Balance Sheet | ||||||
| Total Assets | 24.38B | 25.66B | 24.70B | 25.48B | 24.03B | 21.95B |
| Cash, Cash Equivalents and Short-Term Investments | 2.11B | 3.06B | 3.70B | 4.19B | 3.51B | 3.17B |
| Total Debt | 6.07B | 6.08B | 6.59B | 7.55B | 7.64B | 9.05B |
| Total Liabilities | 13.39B | 13.86B | 14.23B | 15.74B | 15.55B | 15.84B |
| Stockholders Equity | 10.97B | 11.78B | 10.45B | 9.73B | 8.47B | 6.10B |
Cash Flow | ||||||
| Free Cash Flow | 2.13B | 2.21B | 2.27B | 2.23B | 2.31B | 1.46B |
| Operating Cash Flow | 2.44B | 2.53B | 2.52B | 2.52B | 2.58B | 1.66B |
| Investing Cash Flow | -1.14B | -1.34B | -383.00M | -659.00M | -678.00M | -1.71B |
| Financing Cash Flow | -1.63B | -2.02B | -2.31B | -1.12B | -1.75B | 562.00M |
Capgemini Technical Analysis
Positive
30.81
Price Trends
32.13
Positive
30.51
Positive
31.06
Positive
Market Momentum
0.44
Positive
61.32
Neutral
90.11
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CGEMY, the sentiment is Positive. The current price of 30.81 is below the 20-day moving average (MA) of 34.06, below the 50-day MA of 32.13, and below the 200-day MA of 31.06, indicating a bullish trend. The MACD of 0.44 indicates Positive momentum. The RSI at 61.32 is Neutral, neither overbought nor oversold. The STOCH value of 90.11 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CGEMY.
Capgemini Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $41.15B | 19.76 | 14.50% | 1.46% | 7.44% | -4.57% | |
79 Outperform | $172.70B | 23.20 | 25.35% | 2.25% | 6.58% | 1.19% | |
76 Outperform | $74.32B | 22.59 | 29.15% | 2.58% | 4.62% | 1.06% | |
74 Outperform | $30.40B | 19.12 | 16.39% | 2.78% | -1.97% | 48.61% | |
70 Neutral | $12.14B | 33.54 | 10.21% | ― | 14.26% | -15.49% | |
69 Neutral | $29.75B | 17.60 | 13.84% | 2.33% | -0.20% | -6.50% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
CGEMY
Capgemini
34.40
3.04
9.71%
ACN
Accenture
281.82
-60.18
-17.60%
CTSH
Cognizant
85.77
10.31
13.66%
EPAM
Epam Systems
219.78
-6.04
-2.67%
INFY
Infosys
18.04
-4.09
-18.48%
WIT
Wipro
2.91
-0.39
-11.82%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.