Capgemini SE (CAP) AI Stock Analysis

• Market Cap: €21.04B
• Dividend Yield: 2.76%
• Average Volume (3M): 515.65K
• Price to Earnings (P/E): 13.4
• Beta (1Y): 1.27
• Revenue Growth: -0.76%
• EPS Growth: -6.99%
• Country: FR
• Employees: 341,118
• Sector: Technology
• Sector Strength: 91
• Industry: Information Technology Services
• EPS (TTM): 6.00
• Shares Outstanding: 171,347,470
• 10 Day Avg. Volume: 476,038
• 30 Day Avg. Volume: 515,654
• PEG Ratio: N/A
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €164.67
• Price Target Upside: 33.82% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 62 Neutral
• Price Target: €132.00 ▲(7.27% Upside)

Capgemini SE's overall score is influenced primarily by its strong financial performance, which is offset by weak technical indicators. The company's moderate valuation provides some support, but the lack of revenue growth and negative market momentum present challenges.

Positive Factors

Bookings and Orders

An increase in bookings trends with a positive book-to-bill ratio reflects a healthy demand environment.

Free Cash Flow

Organic free cash flow outperformed expectations, coming in at €60 million versus a consensus of €-35 million.

Share Buyback

Improving growth and a new buyback were highlighted, creating a positive sentiment.

Negative Factors

Competitive Intensity

Ongoing risks of increased competitive intensity as peers also struggle present potential challenges.

Market Environment

Constant currency growth of -0.4% indicates Capgemini is operating in a challenging market environment.

Restructuring Costs

Restructuring costs increased by €86 million, contributing to a decline in IFRS EBIT by 15% year-over-year.

Capgemini SE Business Overview & Revenue Model

Company Description

Capgemini SE (CAP) is a global leader in consulting, technology services, and digital transformation. With a presence in over 40 countries, the company operates in several sectors including financial services, manufacturing, public sector, consumer products, and technology. Capgemini offers a wide range of services such as strategy and transformation consulting, application development and maintenance, cloud solutions, and cybersecurity services, all designed to help organizations leverage technology for improved business performance.

How the Company Makes Money

Capgemini generates revenue primarily through its consulting and technology services. The company's revenue model is based on a combination of fixed-price contracts, time and materials contracts, and managed services agreements. Key revenue streams include consulting services, which focus on strategic business transformation; technology services, which involve systems integration and application development; and outsourcing services, which provide clients with managed IT services. Significant partnerships with major technology providers, such as Microsoft, Salesforce, and SAP, enhance Capgemini's offerings and contribute to its earnings by enabling access to advanced technologies and solutions, thus driving business for both Capgemini and its partners.

Capgemini SE Financial Statement Overview

Summary

Capgemini SE demonstrates strong profitability with stable margins and efficient cash generation. The balance sheet is solid but carries a notable level of debt, which could be a risk in a rising interest rate environment. Revenue growth has been modest, suggesting potential market saturation.

Income Statement

Capgemini SE demonstrates strong profitability with a consistent gross profit margin and stable EBIT margin. However, revenue growth has been modest in recent years, which might indicate market saturation or increased competition. The company has maintained a solid net profit margin, reflecting effective cost management.

Balance Sheet

The company maintains a healthy equity ratio, indicating a solid foundation of stockholders' equity relative to total assets. However, the debt-to-equity ratio is relatively high, which could pose risks in a rising interest rate environment. Return on equity is favorable, suggesting effective utilization of shareholder funds.

Cash Flow

Capgemini SE's cash flow generation is robust, with a strong free cash flow to net income ratio indicating effective conversion of earnings into cash. The operating cash flow to net income ratio is stable, showcasing efficient operational cash management. Free cash flow growth has been positive, supporting strategic investments and potential debt reduction.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	22.10B	22.52B	22.00B	18.16B	15.85B
Gross Profit	6.05B	6.05B	5.70B	4.67B	4.02B
EBITDA	3.23B	3.19B	3.13B	2.51B	2.16B
Net Income	1.67B	1.66B	1.55B	1.16B	957.00M
Balance Sheet
Total Assets	25.66B	24.70B	25.48B	24.03B	21.95B
Cash, Cash Equivalents and Short-Term Investments	3.06B	3.70B	4.19B	3.51B	3.17B
Total Debt	6.08B	6.59B	7.55B	7.64B	9.05B
Total Liabilities	13.86B	14.23B	15.74B	15.55B	15.84B
Stockholders Equity	11.78B	10.45B	9.73B	8.47B	6.10B
Cash Flow
Free Cash Flow	2.21B	2.27B	2.16B	2.19B	1.41B
Operating Cash Flow	2.53B	2.52B	2.45B	2.46B	1.61B
Investing Cash Flow	-1.34B	-383.00M	-659.00M	-678.00M	-1.71B
Financing Cash Flow	-2.02B	-2.31B	-1.05B	-1.62B	609.00M

Capgemini SE Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 123.05
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:CAP, the sentiment is Negative. The current price of 123.05 is below the 20-day moving average (MA) of 128.31, below the 50-day MA of 138.12, and below the 200-day MA of 146.97, indicating a bearish trend. The MACD of -4.66 indicates Positive momentum. The RSI at 35.40 is Neutral, neither overbought nor oversold. The STOCH value of 29.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FR:CAP.

Capgemini SE Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WAVE	73 Outperform	€1.38B	18.12	12.58%	0.82%	34.61%	13.69%
NRO	72 Outperform	€999.91M	18.98	14.35%	3.13%	9.33%	6.21%
ATE	72 Outperform	€2.39B	12.77	8.78%	2.19%	1.83%	-21.09%
SOP	70 Outperform	€3.56B	12.72	14.39%	2.65%	-4.12%	43.37%
CAP	62 Neutral	€21.04B	13.41	14.30%	2.76%	-0.76%	-6.99%
Sector *	61 Neutral	$36.02B	6.70	-7.27%	1.99%	8.63%	-7.76%
ATO	34 Underperform	€733.25M	0.45	58.08%	―	-14.60%	―