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Teleperformance SE (FR:TEP)
:TEP

Teleperformance (TEP) AI Stock Analysis

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Teleperformance

(LSE:TEP)

Rating:80Outperform
Price Target:
€105.00
▲(15.13%Upside)
Teleperformance's stock score is driven primarily by its strong financial performance, characterized by solid revenue growth and operational profitability. The company's valuation is compelling with a low P/E ratio and a high dividend yield. Technical indicators show positive momentum without immediate risks of overbought conditions. However, rising debt levels and some volatility in cash flow management are cautions to watch.
Positive Factors
Leadership Transition
The appointment of Teleperformance’s largest shareholder as Chairman and the return of Thomas Mackenbrock as number two may speed up the CEO transition and improve alignment of interests.
Leverage and Shareholder Returns
Leverage will fall below 2x, driving optionality for shareholder returns.
Sales Growth
The sequential improvement in like-for-like sales growth could reassure the market and support profitable growth and deleveraging.
Negative Factors
Valuation Concerns
Valuation is very modest with a 4.5x P/E and 20% FCF yield.

Teleperformance (TEP) vs. iShares MSCI France ETF (EWQ)

Teleperformance Business Overview & Revenue Model

Company DescriptionTeleperformance (TEP) is a global leader in outsourced customer experience management. The company operates across multiple sectors, including telecommunications, healthcare, finance, retail, and technology, providing a comprehensive suite of services such as customer care, technical support, customer acquisition, digital solutions, and back-office processing. Teleperformance is renowned for its ability to deliver high-quality, personalized customer interactions through a blend of human and digital solutions, leveraging advanced analytics and AI-driven technologies to enhance customer experience.
How the Company Makes MoneyTeleperformance makes money primarily through providing outsourced customer experience management services to businesses worldwide. The company's revenue model is based on long-term contracts with clients, where they charge for services rendered, which can include customer support, technical assistance, and digital solutions. Revenue streams are diversified across various sectors, ensuring a stable income base. Teleperformance also benefits from economies of scale, operating numerous contact centers globally, which allows for cost efficiencies and competitive pricing. Significant partnerships with leading technology firms and continuous investment in technology innovation, such as AI and automation, contribute to enhanced service offerings and additional revenue opportunities.

Teleperformance Financial Statement Overview

Summary
Teleperformance shows robust revenue growth and efficient operations, with strong EBIT and EBITDA margins indicating operational profitability. Despite rising net income fluctuations and increasing liabilities, the company maintains a stable equity base and strong cash flow generation capabilities.
Income Statement
85
Very Positive
Teleperformance has demonstrated substantial revenue growth from $5.36 billion in 2019 to $10.28 billion in 2024, indicating a robust growth trajectory. The gross profit margin has improved, reflecting efficient cost management. However, net income has seen fluctuation, with a decrease in 2024, impacting the net profit margin. The company maintains strong EBIT and EBITDA margins, showcasing operational profitability.
Balance Sheet
78
Positive
The balance sheet shows a stable equity base with stockholders' equity increasing from $2.57 billion in 2019 to $4.56 billion in 2024, indicating growing shareholder value. The debt-to-equity ratio remains moderate, but total debt has increased. The equity ratio is healthy, showing a balanced asset structure. However, rising liabilities could pose a risk if not managed carefully.
Cash Flow
82
Very Positive
Operating cash flow has consistently increased, demonstrating strong cash generation capabilities. Free cash flow is growing, with a significant increase in 2024. The operating cash flow to net income ratio is favorable, indicating effective conversion of income to cash. However, fluctuations in free cash flow growth rates suggest potential volatility in cash management.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
10.28B8.35B8.15B7.12B5.73B
Gross Profit
3.35B2.60B1.81B1.50B1.13B
EBIT
1.08B998.00M992.00M859.00M584.70M
EBITDA
1.93B1.61B1.64B1.38B1.05B
Net Income Common Stockholders
523.00M592.00M643.00M557.00M324.00M
Balance SheetCash, Cash Equivalents and Short-Term Investments
1.10B882.00M846.00M837.00M1.05B
Total Assets
12.07B12.07B8.86B8.35B7.02B
Total Debt
4.91B5.43B3.42B3.50B3.27B
Net Debt
3.85B4.55B2.60B2.67B2.27B
Total Liabilities
7.52B7.84B5.19B5.19B4.62B
Stockholders Equity
4.56B4.22B3.67B3.16B2.41B
Cash FlowFree Cash Flow
1.59B1.14B947.00M876.00M694.00M
Operating Cash Flow
1.81B1.38B1.25B1.11B952.00M
Investing Cash Flow
-221.00M-2.59B-602.00M-1.16B-254.00M
Financing Cash Flow
-1.40B1.41B-666.00M-140.00M-123.00M

Teleperformance Technical Analysis

Technical Analysis Sentiment
Positive
Last Price91.20
Price Trends
50DMA
87.88
Positive
100DMA
89.24
Positive
200DMA
88.70
Positive
Market Momentum
MACD
0.25
Positive
RSI
55.26
Neutral
STOCH
70.29
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:TEP, the sentiment is Positive. The current price of 91.2 is above the 20-day moving average (MA) of 90.11, above the 50-day MA of 87.88, and above the 200-day MA of 88.70, indicating a bullish trend. The MACD of 0.25 indicates Positive momentum. The RSI at 55.26 is Neutral, neither overbought nor oversold. The STOCH value of 70.29 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FR:TEP.

Teleperformance Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
FRTEP
80
Outperform
€5.46B10.4111.90%4.61%23.19%-14.73%
FRGLO
79
Outperform
€755.53M10.3416.32%2.71%15.12%22.30%
79
Outperform
€5.56B16.429.66%2.02%6.13%27.24%
FRPLX
74
Outperform
€4.20B17.88
1.65%
FRSW
65
Neutral
€8.33B12.3116.07%4.64%6.71%141.19%
61
Neutral
$14.60B5.95-4.32%3.69%2.76%-30.49%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
FR:TEP
Teleperformance
93.68
-4.16
-4.25%
FR:ELIS
Elis SA
23.64
1.71
7.80%
FR:GLO
GL EVENTS
26.10
6.90
35.96%
FR:SW
Sodexo SA
56.80
-20.99
-26.98%
FR:PLX
PLUXEE N.V.
20.10
-7.71
-27.72%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.