Unemployed and lost but want to see if I am any good with analyzing stocks. Fundamental stock analysis of decent size companies (no penny stocks or crazy tech companies); I have no idea in technical analysis. I am thinking if I am any good I could do some YouTube videos on some of the stocks most requested by the community here and help people make money. I will be using conservative numbers wherever I think it is possible.
Concentrix CNCX is a traditional CX call center service that has many clients like Apple etc. Three of the most important factors for analyzing stocks is History, Competitors, and Outlook -- so I will be trying to put my take on it and make it short as possible.
Competitors:
| As of 2022 | Teleperformance TLPFY | TTEC Holdings TTEC | Majorel MAJ.AS | Concentrix CNCX |
|---|---|---|---|---|
| Revenue | 8.2 bn | 2.5 bn | 2.1 bn | 9.8 bn |
| Gross Profit | N/A | N/A | N/A | N/A |
| Operating Margin | 994 M (12.2%) | 250 M (10%) | 210 M (10%) | 980 M (10%) |
| Assets | 4.4 bn | 1.1 bn | 1 bn | 4 bn |
| Liabilities | (5.2 bn) | (1.5 bn) | (1 bn) | (8 bn) |
| Asset - Liabilities | (800 M) | (400 M) | 0 | (4 bn) |
| Enterprise Value | 10 bn (10 times) | 2.5 bn (10 times) | 2.1 bn (10 times) | 9.8 bn |
| Market Value | 9.2 bn | 2.1 bn | 2.1 bn | 5.8 bn |
| Should be Market Price | 158 | 44 | 22 | 115 |
| Actual Price | 162 | 35 | 29 | 83 |
| Difference | N/A | +25% | -25% | +40% |
History:
The biggest competitor to Concentrix is Teleperformance. So comparing the history of Teleperformance should tell you what the normal range of valuation should be for Concentrix.
| 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|
| Revenue | 8.73 bn | 8.06 bn | 7.05 bn | 6 bn | 5.08 |
| Gross Profit | N/A | N/A | N/A | N/A | N/A |
| Operating Margin | 870M (10%) | 800M (10%) | 700M (10%) | 600M (10%) | 500M (10%) |
| Assets | 5 bn | 4.5 bn | 4 bn | 3.3 bn | 2.7 bn |
| Liabilities | (5.9 bn) | (5.7 bn) | (4.9 bn) | (4.2 bn) | (3 bn) |
| Asset - Liabilities | (1 bn) | (1.2 bn) | (1 bn) | (1 bn) | (300M) |
| Actual Enterprise Value | 23 bn | 20bn | 16bn | 11 bn | 8.3 bn |
| Actual Market Value | 22bn | 19bn | 15bn | 10 bn | 8 bn |
| EV/Revenue | 2.75 | 2.5 | 2.25 | 2 | 1.6 |
| Average | 2.22 | 2.22 | 2.22 | 2.22 | 2.22 |
Outlook:
Concentrix is acquiring Webhelp (private) and becoming the biggest CX provider. They are neck in neck with Teleperformance who acquired Majorel for 1.5 times sales to Enterprise Value - means they all feel prices are low enough for consolidation in the industry.
Looking at the first table it looks like Concentrix is undervalued by 40% on already depressed numbers of EV/Revenue as average EV/Revenue for Teleperformance has been more like 2 historically. So prices will be expected to reach $120 on just 1 times EV/Revenue.
But lets say if we give it a more reasonable number of 1.5-2 EV/Revenue then stock price will be expected to reach $160.
Let me know if this looks good and any comments/upvotes will be appreciated. Feel free to ask any questions whatsoever that makes you contest my opinion or just another stock you would like me to analyze.
[link] [comments] https://www.reddit.com/r/stocks/comments/14d5r7u/cncx_undervalued_stock/
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