Exlservice Holdings (EXLS) AI Stock Analysis

• Market Cap: $7.74B
• Dividend Yield: N/A
• Average Volume (3M): 1.24M
• Price to Earnings (P/E): 36.3
• Beta (1Y): 0.85
• Revenue Growth: 14.18%
• EPS Growth: 21.49%
• Country: US
• Employees: 59,500
• Sector: Technology
• Sector Strength: 79
• Industry: Information Technology Services
• EPS (TTM): 0.48
• Shares Outstanding: 162,694,350
• 10 Day Avg. Volume: 1,229,652
• 30 Day Avg. Volume: 1,244,834
• PEG Ratio: 1.49
• Price to Book (P/B): 7.45
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 46.56
• Enterprise Value/Market Cap: 0.75
• Enterprise Value/Revenue: 0.81
• Enterprise Value/Gross Profit: 8.26
• Enterprise Value/Ebitda: 4.43
• 1Y Price Target: $53.33
• Price Target Upside: 12.87% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

• Rating: 77 Outperform
• Price Target: $53.00 ▲(12.17%Upside)

Exlservice Holdings' strong financial performance and positive earnings call insights, particularly the robust revenue growth and promising AI initiatives, significantly boost its stock score. The technical indicators present a neutral outlook, while the high valuation tempers the overall score. Economic concerns and sector-specific challenges are risks that need monitoring.

Positive Factors

AI Solutions

EXLS' expanding capabilities in AI-led solutions position it to benefit as AI adoption among customers grows, especially in industries such as insurance, healthcare, and banking and capital markets.

Competitive Position

EXLS' strong competitive position and upside potential to Street estimates contribute to a bullish outlook on the shares.

Revenue Growth

The company's revenue exceeded forecasts, with a notable increase of 15% year-over-year.

Negative Factors

Investment Strategy

The company retained its stance of a 10-20bp margin expansion to approximately 19.5% in line with its strategy of investing in data/AI.

Valuation Considerations

Maintaining a MARKET PERFORM investment rating due to valuation considerations.

Exlservice Holdings Business Overview & Revenue Model

Company Description

Exlservice Holdings, Inc. (EXLS) is a leading operations management and analytics company that designs and implements transformative digital solutions for its clients. The company primarily operates in sectors such as insurance, healthcare, banking and financial services, utilities, and travel. EXLS offers a broad range of services including data analytics, business process management, and digital transformation services, helping organizations optimize their business operations and enhance customer experiences.

How the Company Makes Money

Exlservice Holdings generates revenue through a diversified model primarily focused on providing outsourcing and analytics solutions. Key revenue streams include business process management services, which involve taking over and optimizing business operations for clients, and analytics services, which help clients derive actionable insights from data to drive strategic decisions. The company also earns revenue from its digital transformation solutions, which involve implementing new technologies to improve operational efficiency. Strategic partnerships with technology providers and long-term contracts with clients across various industries are significant contributors to EXLS's earnings, ensuring a stable and recurring revenue base.

Exlservice Holdings Financial Statement Overview

Summary

Exlservice Holdings demonstrates strong revenue growth, excellent profit margins, financial stability with low leverage, and effective cash management. These metrics highlight a well-managed company with a solid foundation for future growth and financial health.

Income Statement

The income statement reflects strong financial performance with consistent revenue growth and solid profitability margins. The TTM (Trailing-Twelve-Months) data shows a Gross Profit Margin of 37.2% and a Net Profit Margin of 11.4%, both indicating efficient cost management and profitability. Revenue growth from 2024 to TTM is 3.51%, showing steady expansion. EBIT and EBITDA margins are robust at 14.7% and 18.4%, respectively, demonstrating operational efficiency.

Balance Sheet

The balance sheet is healthy with a relatively low Debt-to-Equity Ratio of 0.08 in TTM, suggesting low financial leverage and reduced risk. The Equity Ratio is strong at 60.4%, indicating a solid equity base. Return on Equity (ROE) is 21.4%, reflecting effective use of equity to generate profits. Overall, the balance sheet indicates financial stability and prudent management of liabilities.

Cash Flow

Cash flow analysis reveals positive trends with Free Cash Flow growth rate of 10.55% from 2024 to TTM, showcasing effective cash management. The Operating Cash Flow to Net Income Ratio stands at 1.36, indicating good cash generation relative to net income. The Free Cash Flow to Net Income Ratio is 1.14, reinforcing the company's ability to generate cash after capital expenditures.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.90B	1.84B	1.63B	1.41B	1.12B	958.43M
	Gross Profit
707.60M	691.01M	607.77M	515.45M	431.36M	334.50M
	EBIT
279.73M	263.62M	238.75M	192.16M	155.88M	110.02M
	EBITDA
360.62M	297.20M	305.72M	262.32M	208.15M	180.03M
	Net Income Common Stockholders
216.09M	198.30M	184.56M	142.97M	114.76M	89.48M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
331.42M	340.58M	290.83M	297.70M	313.88M	402.82M
	Total Assets
1.68B	1.62B	1.44B	1.35B	1.28B	1.25B
	Total Debt
386.10M	364.83M	271.76M	313.13M	347.01M	330.73M
	Net Debt
245.66M	211.47M	134.81M	194.46M	211.67M	112.20M
	Total Liabilities
664.53M	688.54M	552.53M	587.94M	589.75M	528.68M
	Stockholders Equity
1.01B	929.86M	889.44M	758.18M	693.16M	719.17M
Cash Flow		Free Cash Flow
245.71M	222.26M	158.40M	121.31M	147.14M	160.75M
	Operating Cash Flow
293.64M	268.52M	211.20M	166.14M	184.39M	202.97M
	Investing Cash Flow
-146.06M	-119.10M	-12.00M	-96.55M	-114.27M	-18.32M
	Financing Cash Flow
-105.92M	-119.10M	-181.45M	-81.72M	-146.88M	-89.56M

Exlservice Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 47.25
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EXLS, the sentiment is Positive. The current price of 47.25 is above the 20-day moving average (MA) of 46.67, above the 50-day MA of 45.78, and above the 200-day MA of 44.58, indicating a bullish trend. The MACD of 0.46 indicates Negative momentum. The RSI at 54.72 is Neutral, neither overbought nor oversold. The STOCH value of 79.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EXLS.

Exlservice Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EXLS	77 Outperform	$7.74B	36.29	23.81%	―	14.18%	21.49%
EPAM	75 Outperform	$10.00B	24.58	11.57%	―	4.72%	-3.06%
G	75 Outperform	$7.62B	14.61	22.21%	1.56%	7.31%	-15.86%
WNS	75 Outperform	$2.81B	15.61	21.21%	―	-0.64%	30.96%
Sector *	62 Neutral	$11.97B	10.08	-7.46%	2.96%	7.37%	-8.22%
KD	52 Neutral	$9.28B	38.79	22.47%	―	-8.20%	―
DXC	46 Neutral	$2.91B	7.53	12.88%	―	-5.65%	78.20%

Exlservice Holdings Corporate Events

Exlservice Holdings Director Jaynie Studenmund Resigns

On March 12, 2025, Jaynie Studenmund, a member of the Board of Directors at ExlService Holdings, announced her decision not to stand for re-election at the company’s 2025 annual meeting, marking her resignation from the board and its committees by June 2025. Her departure is not due to any disagreements with the company, and during her tenure, she significantly contributed to EXL’s transformation into a leading data and AI company, enhancing stockholder value by over 350%. Her leadership was particularly impactful in the Audit and Compensation and Talent Management Committees.