Exlservice Holdings (EXLS) AI Stock Analysis

• Market Cap: $6.96B
• Dividend Yield: N/A
• Average Volume (3M): 1.33M
• Price to Earnings (P/E): 34.8
• Beta (1Y): 0.99
• Revenue Growth: 12.74%
• EPS Growth: 9.92%
• Country: US
• Employees: 59,500
• Sector: Technology
• Sector Strength: 40
• Industry: Information Technology Services
• EPS (TTM): 1.21
• Shares Outstanding: 162,304,670
• 10 Day Avg. Volume: 1,133,935
• 30 Day Avg. Volume: 1,328,975
• PEG Ratio: 3.51
• Price to Book (P/B): N/A
• Price to Sales (P/S): 4.09
• Price to Cash Flow (P/CF): 17.90
• P/FCF Ratio: 19.30
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $53.14
• Price Target Upside: 25.83% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

Exlservice Holdings is in strong financial health, with significant revenue growth, high profitability, and efficient cash flow management. Although the company's stock shows some technical weakness, it reported robust earnings and strategic advancements in AI and digital operations. The high P/E ratio suggests a premium valuation, which could be a concern for value investors. Foreign exchange headwinds and investment needs present challenges, but overall, the company's strengths significantly outweigh these concerns.

Positive Factors

AI and Technology

The recent launch of an agentic AI platform enables enterprises to embed EXL’s or third-party AI agents into their business operations, broadening its offerings to tap AI-related demand.

Client Acquisition

New client wins continued to tick upward with 69 this year, compared to 63 in the prior year, cementing confidence in the joint value proposition of analytics and digital operations.

Earnings

EXLS posted results which were strong and came in above expectations on both the top and bottom lines, driven by an acceleration in growth in both digital operations and analytics while maintaining healthy margins.

Negative Factors

Foreign Exchange Impact

The FY25 guide was mixed, largely due to a ~$10 million FX headwind.

Valuation Concerns

Maintaining MARKET PERFORM investment rating on EXLS shares due to valuation considerations.

Exlservice Holdings Business Overview & Revenue Model

Company Description

ExlService Holdings, Inc. operates as a data analytics, and digital operations and solutions company in the United States and internationally. It operates through Insurance, Healthcare, Analytics, and Emerging Business segments. The company provides digital operations and solutions and analytics-driven services across the insurance industry in areas, such as claims processing, premium and benefit administration, agency management, account reconciliation, policy research, underwriting support, new business acquisition, policy servicing, premium audit, surveys, billing and collection, commercial and residential survey, and customer service using digital technology, artificial intelligence, machine learning, and advanced automation; digital customer acquisition services using a software-as-a-service delivery model through LifePRO and LISS platforms; subrogation services; and Subrosource software platform, an end-to-end subrogation platform. It also offers CareRadius, an integrated care management offering; and health care services related to care management, utilization management, disease management, payment integrity, revenue optimization and customer engagement to healthcare payers, providers, pharmacy benefit managers, and life sciences organizations. Further, it offers predictive and prescriptive analytics in the areas of customer acquisition and lifecycle management, risk underwriting and pricing, operational effectiveness, credit and operational risk monitoring and governance, payment integrity and care management, and data management. The company was founded in 1999 and is headquartered in New York, New York.

How the Company Makes Money

Exlservice Holdings generates revenue primarily through long-term contracts with clients in diverse industries, offering solutions that integrate analytics, automation, and business process outsourcing (BPO). The company’s key revenue streams are derived from its analytics services, which provide data-driven insights to enhance decision-making, and its operations management services, which improve business processes and efficiency. EXLS also engages in strategic partnerships with technology providers and invests in innovative tools to expand its digital capabilities, thereby contributing to its financial growth.

Exlservice Holdings Financial Statement Overview

Summary

Exlservice Holdings demonstrates robust financial health across all metrics. With strong revenue growth, high profitability, stable leverage, and efficient cash flow management, the company is well-positioned in the competitive software industry. Continued focus on managing liabilities and sustaining growth will enhance long-term financial performance.

Income Statement

Exlservice Holdings exhibits strong profitability and growth. The gross profit margin improved to 37.61%, and the net profit margin stands at 10.79%, reflecting efficient cost management. The revenue growth rate from 2023 to 2024 was 12.73%, indicating robust demand for the company's offerings. The EBIT and EBITDA margins are healthy at 14.34% and 16.17%, respectively, showcasing operational efficiency.

Balance Sheet

The balance sheet is stable with a debt-to-equity ratio of 0.09, suggesting conservative leverage. The return on equity is impressive at 21.32%, reflecting effective utilization of equity. The equity ratio of 57.44% underscores financial stability. However, an increase in total liabilities over the years requires monitoring.

Cash Flow

The cash flow statement is strong, with a free cash flow growth of 40.33% from 2023 to 2024, indicating enhanced cash generation capabilities. The operating cash flow to net income ratio is 1.35, and the free cash flow to net income ratio is 1.12, highlighting efficient cash conversion and utilization.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
1.84B	1.63B	1.41B	1.12B	958.43M
	Gross Profit
691.01M	607.77M	515.45M	431.36M	334.50M
	EBIT
263.62M	238.75M	192.16M	155.88M	110.02M
	EBITDA
297.20M	305.72M	262.32M	208.15M	180.03M
	Net Income Common Stockholders
198.30M	184.56M	142.97M	114.76M	89.48M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
340.58M	290.83M	297.70M	313.88M	402.82M
	Total Assets
1.62B	1.44B	1.35B	1.28B	1.25B
	Total Debt
81.23M	271.76M	313.13M	347.01M	330.73M
	Net Debt
-72.13M	134.81M	194.46M	211.67M	112.20M
	Total Liabilities
688.54M	552.53M	587.94M	589.75M	528.68M
	Stockholders Equity
929.86M	889.44M	758.18M	693.16M	719.17M
Cash Flow		Free Cash Flow
222.26M	158.40M	121.31M	147.14M	160.75M
	Operating Cash Flow
268.52M	211.20M	166.14M	184.39M	202.97M
	Investing Cash Flow
-119.10M	-12.00M	-96.55M	-114.27M	-18.32M
	Financing Cash Flow
-119.10M	-181.45M	-81.72M	-146.88M	-89.56M

Exlservice Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 42.23
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EXLS, the sentiment is Negative. The current price of 42.23 is below the 20-day moving average (MA) of 46.32, below the 50-day MA of 48.30, and above the 200-day MA of 41.65, indicating a neutral trend. The MACD of -0.26 indicates Negative momentum. The RSI at 53.52 is Neutral, neither overbought nor oversold. The STOCH value of 70.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EXLS.

Exlservice Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
G	80 Outperform	$8.27B	16.53	22.15%	1.33%	6.46%	-16.94%
EXLS	79 Outperform	$6.96B	34.85	21.80%	―	12.74%	9.92%
WNS	72 Outperform	$2.88B	20.23	16.64%	―	1.07%	-13.39%
EPAM	69 Neutral	$8.27B	18.28	12.80%	―	0.80%	10.05%
Sector *	57 Neutral	$18.43B	9.69	-13.94%	2.74%	5.03%	-23.61%
KD	48 Neutral	$6.69B	50.53	12.09%	―	-8.20%	―
DXC	47 Neutral	$2.69B	267.98	-2.46%	―	-5.65%	78.20%

Exlservice Holdings Corporate Events

Exlservice Holdings Director Jaynie Studenmund Resigns

On March 12, 2025, Jaynie Studenmund, a member of the Board of Directors at ExlService Holdings, announced her decision not to stand for re-election at the company’s 2025 annual meeting, marking her resignation from the board and its committees by June 2025. Her departure is not due to any disagreements with the company, and during her tenure, she significantly contributed to EXL’s transformation into a leading data and AI company, enhancing stockholder value by over 350%. Her leadership was particularly impactful in the Audit and Compensation and Talent Management Committees.