Genpact (G): Buy, Sell, or Hold Post Q2 Earnings?

October 13, 2025 at 00:01 AM EDT

G Cover Image

Over the past six months, Genpact’s shares (currently trading at $39.03) have posted a disappointing 18.7% loss, well below the S&P 500’s 21.1% gain. This may have investors wondering how to approach the situation.

Is now the time to buy Genpact, or should you be careful about including it in your portfolio? Check out our in-depth research report to see what our analysts have to say, it’s free for active Edge members.

Why Is Genpact Not Exciting?

Despite the more favorable entry price, we're cautious about Genpact. Here are two reasons there are better opportunities than G and a stock we'd rather own.

1. Projected Revenue Growth Is Slim

Forecasted revenues by Wall Street analysts signal a company’s potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite.

Over the next 12 months, sell-side analysts expect Genpact’s revenue to rise by 4.8%, close to its 6.2% annualized growth for the past five years. This projection doesn't excite us and implies its newer products and services will not lead to better top-line performance yet.

2. Free Cash Flow Margin Dropping

Free cash flow isn't a prominently featured metric in company financials and earnings releases, but we think it's telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.

As you can see below, Genpact’s margin dropped by 3.9 percentage points over the last five years. If its declines continue, it could signal increasing investment needs and capital intensity. Genpact’s free cash flow margin for the trailing 12 months was 11.4%.

Genpact Trailing 12-Month Free Cash Flow Margin

Final Judgment

Genpact isn’t a terrible business, but it doesn’t pass our bar. After the recent drawdown, the stock trades at 10.7× forward P/E (or $39.03 per share). This valuation multiple is fair, but we don’t have much faith in the company. We're fairly confident there are better stocks to buy right now. We’d recommend looking at one of Charlie Munger’s all-time favorite businesses.

Stocks We Would Buy Instead of Genpact

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.

About Us

Additional Information

Website & Technical Help