Concentrix (CNXC) AI Stock Analysis

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Concentrix

(NASDAQ:CNXC)

Rating:76Outperform

Price Target:

$68.00

▲(17.57%Upside)

Concentrix's strong technical indicators and robust earnings outlook are the primary drivers of its positive stock score. The company's financial performance is solid, though net profit margins and high debt levels are areas to watch. Valuation is fair, and the dividend yield is appealing for income investors.

Positive Factors

Growth Prospects

The company's strong sales pipeline is expected to generate sequential revenue growth over the fiscal year.

Revenue Performance

Concentrix reported total revenue of $2.42 billion, exceeding both internal and FactSet consensus forecasts by 2%.

Negative Factors

Earnings Performance

Concentrix's fiscal Q2/25 non-GAAP EPS of $2.70 fell short of both internal and FactSet consensus forecasts.

Operating Margin

Despite a revenue beat, the operating margin missed guidance mid-point due to negative operating leverage and investments for future growth.

Concentrix (CNXC) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$3.77B

Dividend Yield2.3%

Average Volume (3M)781.34K

Price to Earnings (P/E)16.4

Beta (1Y)1.09

Revenue Growth11.31%

EPS Growth-16.02%

CountryUS

Employees450,000

SectorTechnology

Sector Strength96

IndustryInformation Technology Services

Share Statistics

EPS (TTM)2.70

Shares Outstanding63,025,120

10 Day Avg. Volume594,974

30 Day Avg. Volume781,338

Financial Highlights & Ratios

PEG Ratio-0.12

Price to Book (P/B)0.90

Price to Sales (P/S)0.00

P/FCF Ratio7.97

Enterprise Value/Market Cap2.23

Enterprise Value/Revenue0.22

Enterprise Value/Gross Profit2.45

Enterprise Value/Ebitda1.62

Forecast

1Y Price Target

$65.00

Price Target Upside12.38% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering4

Concentrix Business Overview & Revenue Model

Company DescriptionConcentrix Corporation provides technology-infused customer experience (CX) solutions worldwide. The company provides CX process optimization, technology innovation, front- and back-office automation, analytics, and business transformation services. It also offers customer lifecycle management; customer experience/user experience strategy and design; digital transformation; and voice of the customer and analytics solutions. The company's clients include consumer electronics, technology, e-commerce, and health insurance companies, as well as global IPOs, social brands, and banks. Concentrix Corporation was incorporated in 2009 and is based in Fremont, California.

How the Company Makes MoneyConcentrix makes money primarily through its business process outsourcing (BPO) services, where it partners with companies to handle their customer interactions and back-office functions. The company generates revenue by providing outsourced customer support, technical support, sales, and marketing services, often on a contractual basis. Concentrix also offers consulting and analytics solutions, leveraging data to help clients improve their customer experience strategies. Key revenue streams include long-term service agreements with businesses across multiple industries, often tailored to meet the specific needs of each client. Significant partnerships with technology providers and industry leaders further enhance Concentrix's ability to deliver comprehensive solutions and drive its earnings.

Concentrix Earnings Call Summary

Earnings Call Date:Jun 26, 2025

(Q2-2025)

% Change Since: 5.49%|

Next Earnings Date:Sep 24, 2025

Earnings Call Sentiment Neutral

The earnings call reflects a balanced view with significant achievements in revenue growth, cash flow, and AI advancements. However, operational margin challenges and impacts from tariffs alongside high debt levels present notable concerns. The outlook remains positive with expected improvements in the second half.

Q2-2025 Updates

Positive Updates

Solid Revenue Performance

Revenue for the second quarter was approximately $2.4 billion, an increase of 1.5% year-on-year. This exceeded guidance and was broad-based across verticals.

Strong Adjusted Free Cash Flow

Concentrix delivered over $200 million in adjusted free cash flow in the quarter, showing a significant improvement of about $240 million sequentially from Q1.

AI and Technology Developments

The launch of iX Hero and the success of iX Hello have positioned Concentrix as a leader in AI solutions, with expectations for these products to be accretive by the end of Q4.

Market Recognition and Pipeline Growth

Concentrix received strong market recognition for its AI capabilities. Their pipeline is strong, and new business is accretive to margins as these programs scale.

Positive Outlook for the Second Half

The company expects revenue acceleration in the second half of 2025, driven by a strong pipeline and new business wins.

Negative Updates

Operational Margin Challenges

Operational margins for the quarter were lighter than anticipated, primarily due to holding labor in April while clients reacted to tariffs.

Impact of Tariffs

Some clients paused programs due to the impact of tariffs, affecting margins and requiring Concentrix to hold labor, which impacted profitability.

Flat Performance in Key Verticals

Revenue growth in the tech and healthcare verticals was relatively flat, reflecting challenges such as offshore movement.

High Debt Levels

Concentrix's total debt stands at approximately $4.9 billion with a net debt of $4.5 billion, though they have made efforts to reduce this with a $150 million voluntary payment.

Company Guidance

In the Concentrix Second Quarter 2025 Earnings Call, the company provided a robust financial outlook, highlighting several key metrics. The company reported second-quarter revenue of approximately $2.4 billion, marking a 1.5% year-on-year increase on both constant currency and as-reported bases, surpassing initial guidance. Non-GAAP operating income was $304 million, although slightly below expectations due to client program pauses related to tariffs; however, margins improved by May's end. Adjusted EBITDA reached $357 million, with a margin of 14.8%, while adjusted free cash flow was $200 million. The company returned $67 million to shareholders, including $45 million in share repurchases. Looking ahead, Concentrix expects third-quarter revenue between $2.445 billion and $2.470 billion, with constant currency growth of 1% to 2%. For the full fiscal year 2025, revenue is projected between $9.720 billion and $9.815 billion, with non-GAAP EPS expected to range from $11.53 to $11.76. The company remains optimistic about AI-driven growth, with new AI solutions like iX Hero and iX Hello beginning to gain market traction, and aims for adjusted free cash flow between $625 million and $650 million.

Concentrix Financial Statement Overview

Summary

Concentrix demonstrates strong revenue growth and effective debt management, positioning it well within the Information Technology Services industry. However, profitability metrics indicate some pressure, which, coupled with strong cash flow generation, provides a buffer against potential risks.

Income Statement

Positive

Concentrix demonstrates strong revenue growth with a 51.86% increase from 2020 to 2023, indicating robust demand for its services. The gross profit margin and EBIT margin show stability, with a recent TTM gross profit margin of 34.12% and EBIT margin of 6.76%. However, the net profit margin has slightly decreased to 2.81% TTM, reflecting potential cost pressures or increased competition.

Balance Sheet

Positive

The company's balance sheet reflects a strong equity position with an equity ratio of 33.92% TTM. The debt-to-equity ratio has significantly improved to 0.11, suggesting effective debt management. However, the return on equity has declined from 16.15% in 2022 to 6.68% TTM, indicating a drop in profitability relative to shareholders' equity.

Cash Flow

Positive

Concentrix has maintained a healthy operating cash flow with a TTM operating cash flow to net income ratio of 2.66, indicating strong cash generation capabilities relative to net income. The free cash flow has grown from 2022 to TTM, demonstrating effective capital expenditure management. However, fluctuations in cash flow from financing activities suggest potential challenges in external funding.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.63B	9.62B	7.11B	6.32B	5.59B	4.72B
Gross Profit	3.44B	3.45B	2.58B	2.26B	1.97B	1.66B
EBITDA	1.27B	1.33B	997.53M	984.62M	855.92M	592.77M
Net Income	244.63M	251.22M	313.84M	435.05M	405.58M	164.81M
Balance Sheet
Total Assets	12.40B	11.99B	12.49B	6.67B	5.05B	5.18B
Cash, Cash Equivalents and Short-Term Investments	342.76M	240.57M	295.34M	145.38M	182.04M	152.66M
Total Debt	4.89B	4.74B	4.94B	2.22B	802.02M	1.15B
Total Liabilities	8.12B	7.95B	8.35B	3.97B	2.43B	2.88B
Stockholders Equity	4.28B	4.04B	4.14B	2.70B	2.62B	2.30B
Cash Flow
Free Cash Flow	484.94M	428.73M	497.48M	460.70M	365.10M	336.28M
Operating Cash Flow	713.97M	667.49M	678.01M	600.72M	514.18M	507.61M
Investing Cash Flow	-230.69M	-244.27M	-2.11B	-1.84B	-78.65M	-109.22M
Financing Cash Flow	-355.86M	-492.53M	1.80B	1.24B	-401.87M	-335.22M

Concentrix Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price57.84

Price Trends

50DMA

56.29

Positive

100DMA

52.65

Positive

200DMA

48.68

Positive

Market Momentum

MACD

1.19

Negative

RSI

50.97

Neutral

STOCH

59.43

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CNXC, the sentiment is Neutral. The current price of 57.84 is below the 20-day moving average (MA) of 58.17, above the 50-day MA of 56.29, and above the 200-day MA of 48.68, indicating a neutral trend. The MACD of 1.19 indicates Negative momentum. The RSI at 50.97 is Neutral, neither overbought nor oversold. The STOCH value of 59.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CNXC.

Concentrix Risk Analysis

Concentrix disclosed 27 risk factors in its most recent earnings report. Concentrix reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Concentrix Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WNS	79 Outperform	$3.21B	19.94	21.24%	―	1.94%	26.19%
CTSH	78 Outperform	$37.18B	15.88	16.61%	1.63%	4.09%	14.05%
G	77 Outperform	$7.93B	15.42	22.21%	1.43%	7.31%	-15.86%
CNXC	76 Outperform	$3.77B	16.42	5.59%	2.30%	11.31%	-16.02%
ASGN	71 Outperform	$2.38B	17.00	7.71%	―	-6.31%	-23.56%
DXC	67 Neutral	$2.59B	6.75	12.88%	―	-5.82%	469.88%
Sector *	63 Neutral	$34.93B	5.90	-12.00%	2.00%	5.61%	-19.55%

* Technology Sector Average

Performance Comparison

CNXC

Concentrix

57.84

-10.88

-15.83%

CTSH

Cognizant

74.91

0.37

0.50%

Genpact

45.19

11.03

32.29%

ASGN

53.54

-41.13

-43.45%

WNS

74.78

15.20

25.51%

DXC

DXC Technology

14.13

-6.21

-30.53%

Concentrix Corporate Events

Executive/Board Changes

Olivier Duha Resigns from Concentrix Board of Directors

Neutral

Jun 5, 2025

On June 3, 2025, Olivier Duha resigned from the Board of Directors of Concentrix Corporation, effective immediately. His resignation was due to personal reasons and not because of any disagreements with the company’s operations, policies, or practices.

The most recent analyst rating on (CNXC) stock is a Buy with a $70.00 price target. To see the full list of analyst forecasts on Concentrix stock, see the CNXC Stock Forecast page.

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.Date of analysis: Jul 09, 2025