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TaskUs (TASK)
NASDAQ:TASK
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TaskUs
(NASDAQ:TASK)
58Neutral
Positive Factors
Client Relationships
TASK is positioned as a top 3 vendor for META due to comprehensive offerings across Trust & Safety and AI Services.
Revenue Growth
Ongoing improvement in TASK’s revenue growth trajectory is encouraging, with potential upside risks including incremental deal wins in the enterprise space and greater-than-expected demand for outsourced services.
Negative Factors
Valuation Concerns
Analysts remain Neutral-rated given TASK’s premium valuation vs. peers, as well as ongoing contact-center-related fears from investors that will likely keep shares range-bound over the near term.
TaskUs (TASK) vs. S&P 500 (SPY)
Market Cap
$1.19B
Dividend YieldN/A
Average Volume (3M)429.43K
Price to Earnings (P/E)26.4
Beta (1Y)1.80
Revenue Growth7.64%
EPS Growth5.22%
CountryUS
Employees48,200
SectorTechnology
Sector Strength45
IndustrySoftware
Share Statistics
EPS (TTM)0.50
Shares Outstanding19,964,102
10 Day Avg. Volume595,942
30 Day Avg. Volume429,426
Financial Highlights & Ratios
PEG Ratio5.06
Price to Book (P/B)N/A
Price to Sales (P/S)1.19
Price to Cash Flow (P/CF)7.30
P/FCF Ratio7.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$19.50Price Target Upside47.73% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
TaskUs Business Overview & Revenue Model
Company DescriptionTaskUs, Inc. (NASDAQ: TASK) is a global outsourcing company that provides digital business services to high-growth technology companies. The company specializes in delivering customer support, content moderation, and AI operations solutions. TaskUs operates across several key sectors, including social media, e-commerce, gaming, and fintech, offering scalable and flexible solutions tailored to meet the unique needs of its clients.
How the Company Makes MoneyTaskUs generates revenue primarily through long-term contracts with its clients, providing outsourced digital services such as customer support, content moderation, and back-office operations. The company's key revenue streams are derived from service fees charged for each contract, which are typically based on the volume of work performed or the number of hours dedicated to a client's project. TaskUs has built significant partnerships with large, high-growth technology companies, which contribute substantially to its earnings. The company's ability to scale operations quickly and efficiently, combined with its focus on innovation and quality service delivery, enables it to maintain strong client relationships and secure repeat business, which are crucial factors in its financial performance.
TaskUs Financial Statement Overview
Summary
TaskUs displays strengths in cash flow management and balance sheet stability, with a positive operating cash flow and moderate leverage. However, the company faces challenges in revenue generation and cost management, as highlighted by declining revenue and negative gross profit in the income statement.Income Statement
The income statement reflects a challenging environment, with a notable decrease in revenue over the past year and a negative gross profit, indicating inefficiencies in cost management. While EBIT and EBITDA margins improved, these were insufficient to offset the revenue decline, resulting in stagnant net profit margins.50
Neutral
Balance Sheet
TaskUs maintains a relatively stable balance sheet with a debt-to-equity ratio that suggests moderate leverage, and a positive equity ratio indicating sufficient equity backing its assets. However, the return on equity is modest, reflecting limited profitability from shareholders' capital.65
Positive
Cash Flow
The company has demonstrated strong free cash flow generation, with a positive free cash flow to net income ratio and robust operating cash flows. Although free cash flow growth has fluctuated, the overall cash flow position remains healthy.70
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 994.99M | 924.37M | 960.49M | 760.70M | 478.05M | Gross Profit |
| 392.09M | 385.62M | 401.73M | 328.97M | 207.54M | EBIT |
| 92.42M | 95.04M | 83.90M | -54.23M | 50.33M | EBITDA |
| 155.89M | 157.49M | 153.23M | -6.57M | 90.90M | Net Income Common Stockholders |
| 45.87M | 45.69M | 40.42M | -58.70M | 34.53M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 192.17M | 125.78M | 133.99M | 63.58M | 107.73M | Total Assets |
| 953.30M | 864.20M | 902.01M | 750.00M | 707.51M | Total Debt |
| 305.20M | 311.57M | 311.55M | 238.38M | 244.75M | Net Debt |
| 113.03M | 185.80M | 177.56M | 174.79M | 137.02M | Total Liabilities |
| 456.38M | 423.49M | 446.40M | 370.86M | 372.37M | Stockholders Equity |
| 496.92M | 440.71M | 455.61M | 379.13M | 335.14M |
| Cash Flow | Free Cash Flow | |||
| 99.78M | 112.67M | 103.34M | -92.04M | 29.99M | Operating Cash Flow |
| 138.89M | 143.67M | 147.09M | -32.67M | 58.87M | Investing Cash Flow |
| -39.10M | -32.00M | -67.99M | -59.36M | -28.88M | Financing Cash Flow |
| -25.18M | -119.08M | -4.04M | 54.39M | 36.99M |
TaskUs Technical Analysis
Negative
13.20
Price Trends
15.53
Negative
15.10
Negative
14.47
Negative
Market Momentum
-0.75
Positive
35.42
Neutral
21.84
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TASK, the sentiment is Negative. The current price of 13.2 is below the 20-day moving average (MA) of 14.27, below the 50-day MA of 15.53, and below the 200-day MA of 14.47, indicating a bearish trend. The MACD of -0.75 indicates Positive momentum. The RSI at 35.42 is Neutral, neither overbought nor oversold. The STOCH value of 21.84 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TASK.
TaskUs Risk Analysis
TaskUs disclosed 64 risk factors in its most recent earnings report. TaskUs 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
TaskUs Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $8.72B | 17.64 | 22.15% | 1.23% | 6.46% | -16.94% | |
79 Outperform | $7.48B | 38.06 | 21.80% | ― | 12.74% | 9.92% | |
71 Outperform | $2.94B | 12.30 | 5.89% | 2.78% | 35.20% | -35.86% | |
69 Neutral | $17.19B | 14.54 | 29.12% | 1.15% | 7.93% | 541.97% | |
58 Neutral | $1.19B | 26.42 | 9.78% | ― | 7.64% | 5.22% | |
58 Neutral | $21.35B | 9.96 | -19.72% | 2.38% | 5.03% | -22.83% | |
45 Neutral | $172.41M | ― | -75.62% | 15.55% | -10.32% | -3860.81% |
* Technology Sector Average
Performance Comparison
TASK
TaskUs
13.14
0.79
6.40%
EXLS
Exlservice Holdings
46.12
15.11
48.73%
G
Genpact
49.10
15.82
47.54%
TTEC
TTEC Holdings
3.38
-7.43
-68.73%
LDOS
Leidos Holdings
133.60
6.89
5.44%
CNXC
Concentrix
44.28
-17.57
-28.41%
TaskUs Earnings Call Summary
Earnings Call Date: Feb 26, 2025 | % Change Since: -15.60% | Next Earnings Date: May 12, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a strong performance in revenue growth and new client acquisitions, with positive expectations for 2025. However, this is tempered by margin pressures due to increased investments and security incidents.Highlights
Record-Breaking Revenue and Growth
TaskUs delivered $274.2 million in Q4 2024 revenue, exceeding guidance by $4.9 million and marking the second consecutive quarter of record-breaking revenue. This reflects a 17.1% year-over-year revenue growth.
Strong Performance Across Service Lines
All three service lines exhibited accelerated year-over-year revenue growth in Q4 2024, with digital customer experience growing 8.5%, trust and safety at 34%, and AI services reaching 31%.
Successful New Client Acquisitions
Q4 2024 saw a significant uptick in new logo signings, with new clients contributing notably to the revenue growth, especially in financial services and healthcare verticals.
Positive Outlook for 2025
TaskUs expects full-year 2025 revenue of approximately $1.11 billion and aims to continue double-digit revenue growth while expanding adjusted EBITDA margins.
Lowlights
Margin Pressure
Q4 2024 adjusted EBITDA margin was 19.6%, below the guidance of 21.1%, impacted by higher than anticipated investments and certain business disruptions.
Security Incident Impact
Q4 2024 revenue and margins were negatively impacted by security incidents, leading to suspended operations and necessitating increased investments in security.
Increased SG&A Expenses
SG&A expenses increased to $67.8 million or 24.7% of revenue in Q4 2024, driven by certain litigation costs and higher personnel costs.
Company Guidance
During TaskUs' fiscal fourth quarter and full year 2024 earnings call, the company reported a revenue of $274.2 million for Q4, surpassing the guidance of $269.3 million, reflecting a 17.1% year-over-year growth. The full year revenue reached $995 million with an adjusted EBITDA of $209.9 million, representing a margin of 21.1%. Despite outperforming in revenue, TaskUs experienced a 150 basis point shortfall in adjusted EBITDA margin compared to the guidance of 21.1%, achieving only 19.6% due to increased investments and business disruptions. TaskUs anticipates 2025 revenue between $1.095 billion and $1.125 billion, with expected Q1 2025 revenue of $270-$272 million, implying a 19% year-over-year growth at the midpoint. The company aims for a 21% adjusted EBITDA margin for the full year, with Q1 margins expected at 20%, influenced by fewer working days and seasonal factors. TaskUs plans substantial investments in AI services, security, and operational efficiency, targeting to sustain double-digit growth and margin expansion throughout 2025.TaskUs Corporate Events
Executive/Board Changes
TaskUs Announces Resignation of Chief Accounting Officer
Neutral
Dec 20, 2024
Steven Amaya, Chief Accounting Officer and Treasurer of TaskUs, Inc., has announced his resignation effective February 26, 2025, to pursue other opportunities. Until a permanent successor is appointed, Balaji Sekar, the current Chief Financial Officer, will assume the role of principal accounting officer along with his current duties as principal financial officer.
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.