Education
About Us
Working with TipRanks
Follow Us
Globant SA (GLOB)
NYSE:GLOB
Top Page
Globant SA
(NYSE:GLOB)
Rating:66Neutral
Price Target:
$110.00
▲( 9.32% Upside)
Positive Factors
Growth Prospects
GLOB maintains a differentiated offering and is more advanced in its AI practice development.
Product Offering
Globant’s new AI-powered subscription model will enable clients to more easily reap tangible savings and efficiencies from AI, offering a consumption-based alternative to time-and-material and fixed priced contracts.
Valuation
The stock now trades at a historically-low 12-month forward P/E of 16x, which is more than 2.5 standard deviations below its roughly 30x average over the past 3 years.
Negative Factors
Client Behavior
Increased economic uncertainty is delaying client decision-making, particularly in LATAM.
Financial Performance
Globant reported fiscal first-quarter results that came in weaker than consensus expectations for revenue and EPS.
Revenue Growth
Management lowering 2025 organic revenue growth expectations to roughly flat year-over-year implies mid-single-digit negative growth in the second half of 2025.
Globant SA (GLOB) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.43B
Dividend YieldN/A
Average Volume (3M)1.29M
Price to Earnings (P/E)29.0
Beta (1Y)1.35
Revenue Growth11.90%
EPS Growth-11.15%
CountryUS
Employees31,280
SectorTechnology
Sector Strength76
IndustryInformation Technology Services
Share Statistics
EPS (TTM)1.50
Shares Outstanding44,045,560
10 Day Avg. Volume2,481,696
30 Day Avg. Volume1,290,845
Financial Highlights & Ratios
PEG Ratio-13.75
Price to Book (P/B)2.96
Price to Sales (P/S)0.00
P/FCF Ratio25.67
Enterprise Value/Market Cap1.34
Enterprise Value/Revenue0.64
Enterprise Value/Gross Profit7.20
Enterprise Value/Ebitda4.20
Forecast
1Y Price Target
$142.38Price Target Upside41.50% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering14
Globant SA Business Overview & Revenue Model
Company DescriptionGlobant S.A. operates as a technology services company worldwide. It offers e-commerce, new distribution capabilities, augmented revenue management, hyper connected operation, and conversational user experience services through reinvention studios; digital lending, commercial effectiveness, finance, sustainability, regulation analytic, transformation and post-merger integration, and payment and open banking services; and game and graphic engineering, UI and UX design, game as a service, DevOps, and online services, as well as high tech tools. The company also provides smart farming, image diagnosis, healthcare interoperability, genomics data processing, telemedicine and medical device, research and development, and precision medicine services; media and entertainment, and travel and hospitality services; cloud transformation advice, building cloud environment, moving workloads to the cloud, cloud support and operation, chaos engineering, and site reliability engineering services; and data strategies, insights, data platforms, MLOps, and data as a product services. In addition, it offers agile delivery, blockchain, business and cultural hacking, conversational interface, cybersecurity, design, digital sales and marketing, enterprise applications, internet of thing, metaverse, process optimization, quality engineering, salesforce, smart venue, UI engineering, and sustainable business solutions. Further, the company provides smart underwriting, monitoring, and digital collection services; digital experience platforms; product strategy, management, and delivery services; and strategic architecture consulting, platforms evolution, and augmented composable solutions. Additionally, it operates augmented coding and testing, StarMeUp, PagoChat, ShopChat, and Walmeric platforms. The company was formerly known as IT Outsourcing S.L. and changed its name to Globant S.A. in December 2012. Globant S.A. was founded in 2003 and is based in Luxembourg.
How the Company Makes MoneyGlobant SA makes money primarily through its technology services and consulting offerings. The company generates revenue by providing tailored software development and IT services to a wide range of industries, helping businesses embrace digital transformation. Key revenue streams include project-based engagements where Globant designs, builds, and manages software solutions, as well as ongoing support and consulting services. The company often enters into long-term partnerships with its clients, enabling sustained income through continuous project work and strategic advisory roles. Globant's ability to innovate and deliver cutting-edge technology solutions, such as artificial intelligence and machine learning, further enhances its appeal to businesses looking to modernize their operations. Additionally, the company's geographical diversity and strong presence in emerging markets contribute to its earnings potential.
Globant SA Financial Statement Overview
Summary
Globant SA exhibits strong financial health characterized by consistent revenue and profit growth, solid margins, and effective cash flow management. The balance sheet reflects a prudent leverage strategy, although rising debt levels should be monitored. Overall, the company demonstrates sound financial management and operational efficiency, positioning it well within the software industry.Income Statement
Globant SA has shown consistent revenue growth over the years, with a strong increase from $814 million in 2020 to $2.42 billion in 2024. Gross profit margin has been stable, with the latest figure at 36.26%, indicating efficient cost management. The net profit margin has slightly improved to 6.86% in 2024, reflecting good profitability. EBIT and EBITDA margins have also shown steady improvement, demonstrating operational efficiency.85
Very Positive
Balance Sheet
The company's debt-to-equity ratio remains manageable at 0.21, indicating a conservative leverage approach, while the equity ratio is strong at 61.99%, reflecting a solid equity base. The return on equity (ROE) is healthy at 8.44%, showcasing effective utilization of equity. However, the increase in total debt over the years warrants monitoring.78
Positive
Cash Flow
Globant SA has demonstrated strong free cash flow growth, with a recent increase to $220.99 million in 2024. The operating cash flow to net income ratio is robust at 1.50, indicating a strong cash-generating ability relative to profits. Similarly, the free cash flow to net income ratio of 1.33 underscores the company's capability to convert profit into cash efficiently.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 2.42B | 2.10B | 1.78B | 1.30B | 814.14M | Gross Profit |
| 875.93M | 755.76M | 669.39M | 494.99M | 304.33M | EBIT |
| 225.42M | 198.96M | 107.87M | 64.83M | 41.55M | EBITDA |
| 405.14M | 361.54M | 317.25M | 218.08M | 135.43M | Net Income Common Stockholders |
| 165.73M | 158.54M | 148.89M | 96.06M | 54.22M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 156.09M | 324.76M | 347.39M | 462.44M | 299.80M | Total Assets |
| 3.17B | 2.74B | 2.19B | 1.89B | 1.29B | Total Debt |
| 410.16M | 277.84M | 138.84M | 146.72M | 113.57M | Net Debt |
| 268.07M | -29.38M | -153.62M | -281.08M | -165.37M | Total Liabilities |
| 1.13B | 948.74M | 636.34M | 581.92M | 408.83M | Stockholders Equity |
| 1.96B | 1.73B | 1.51B | 1.31B | 879.94M |
| Cash Flow | Free Cash Flow | |||
| 220.99M | 191.72M | 102.09M | 101.34M | 46.41M | Operating Cash Flow |
| 248.73M | 318.52M | 197.52M | 178.97M | 99.87M | Investing Cash Flow |
| -403.90M | -350.36M | -269.30M | -272.88M | -124.02M | Financing Cash Flow |
| -5.81M | 44.53M | -65.68M | 243.99M | 241.55M |
Globant SA Technical Analysis
Negative
100.62
Price Trends
117.64
Negative
155.27
Negative
182.59
Negative
Market Momentum
-4.05
Positive
36.65
Neutral
27.45
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GLOB, the sentiment is Negative. The current price of 100.62 is below the 20-day moving average (MA) of 118.96, below the 50-day MA of 117.64, and below the 200-day MA of 182.59, indicating a bearish trend. The MACD of -4.05 indicates Positive momentum. The RSI at 36.65 is Neutral, neither overbought nor oversold. The STOCH value of 27.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GLOB.
Globant SA Risk Analysis
Globant SA disclosed 43 risk factors in its most recent earnings report. Globant SA 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 1 New Risks
1.
Failure to meet environmental, social and governance ("ESG") regulations, stakeholders' expectations or our Company's voluntary ESG goals could adversely affect our reputation, business, performance and results of operations. Q4, 2024
Globant SA Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $76.33B | 23.74 | 29.00% | 2.29% | 3.85% | -0.38% | |
80 Outperform | $33.74B | 27.27 | 113.19% | ― | 5.99% | 59.74% | |
78 Outperform | $7.42B | 34.43 | 23.81% | ― | 14.18% | 21.49% | |
76 Outperform | $39.00B | 16.66 | 16.61% | 1.53% | 4.09% | 14.05% | |
72 Outperform | $7.17B | 28.25 | 10.28% | 1.69% | 2.71% | 39.56% | |
66 Neutral | $4.43B | 29.00 | 7.97% | ― | 11.90% | -11.15% | |
61 Neutral | $11.29B | 10.07 | -7.05% | 2.96% | 7.47% | -10.75% |
* Technology Sector Average
Performance Comparison
GLOB
Globant SA
100.62
-64.15
-38.93%
CTSH
Cognizant
79.12
13.26
20.13%
DLB
Dolby Laboratories
74.67
-3.33
-4.27%
EXLS
Exlservice Holdings
45.58
15.35
50.78%
IT
Gartner
438.36
3.66
0.84%
INFY
Infosys
18.11
1.26
7.48%
Globant SA Earnings Call Summary
Earnings Call Date:May 15, 2025
(Q1-2025)
| % Change Since: -24.25%|
Next Earnings Date:Aug 14, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a balanced sentiment with solid revenue growth, strategic investments, and innovative models countered by macroeconomic challenges and regional declines, particularly in Latin America.Q1-2025 Updates
Positive Updates
Solid Revenue Growth
Revenues reached $611.1 million, representing a 7% increase year-over-year, and 8.6% in constant currency.
Strong Pipeline and Market Expansion
The pipeline remains robust with a 20% increase over last year, and strong growth in new markets like The Middle East, APAC, and Europe.
Innovative AI Subscription Model
Introduction of the Globant subscription model offering AI-powered capacity through AI Pods, with early traction and adoption by clients like YPF and JM Family.
Strategic Deals and Partnerships
Announced partnerships with the Saudi Pro League, Formula 1, and AIB, showcasing the application of technology solutions.
Recognition from Major Partners
Received multiple recognitions from Google, Amazon Web Services, and Adobe for strong strategic relationships.
Negative Updates
Performance Below Expectations
Q1 performance came in below initial expectations due to a challenging macroeconomic environment.
Impact of Macroeconomic Challenges
US recession probability increased, consumer spending softened, and trade tariffs impacted customer spending.
Regional Decline in Latin America
Challenging performance in Latin America with a nearly 9% year-over-year decline, particularly in Mexico and Brazil.
Delayed Project Ramps
Delays in project ramps in large accounts, especially in tariff-impacted industries like Airlines, Pharma, and High Tech.
Adjusted Operating Margin Below Expectations
Adjusted operating margin for the quarter was 14.8%, falling short due to lower-than-expected revenues.
Company Guidance
During Globant's First Quarter 2025 earnings call, the company provided revised guidance reflecting the current challenging macroeconomic environment. Revenues for Q1 reached $611.1 million, marking a 7% year-over-year increase, with a constant currency growth of 8.6%. However, this was slightly below the February guidance due to uncertainties such as U.S. recession risks, softened consumer spending, and trade tariff impacts, particularly affecting Latin America. For Q2 2025, Globant projected at least $612 million in revenues, representing a 4.2% year-over-year growth, and maintained an adjusted operating margin target of 15% for both Q2 and the full year. The full-year 2025 revenue guidance was revised to at least $2,464 million, indicating a 2.0% year-over-year growth. The company emphasized strategic investments in AI Industry studios and 100-squared accounts as key growth drivers and highlighted a robust 20% year-over-year increase in their pipeline. Additionally, Globant introduced a consumption-based subscription model to enhance service delivery and client engagement. The effective income tax rate for both Q2 and the full year is expected to be between 20% and 22%, with an adjusted diluted EPS forecast of at least $1.52 for Q2 and $6.10 for the full year, based on the assumption of 45.7 million diluted shares outstanding for Q2 and 45.8 million for the year.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.