2024-02-06 20:12:36 ET
Summary
- Even if we project lower sales, the company has the potential to rebound.
- AI implementation, Majorel acquisition, and solid capital allocation priorities make Teleperformance a clear buy.
- Majorel integration and an upcoming capital market day could provide a re-rating.
Teleperformance ([[TLPFF]], [[TLPFY]]) is a France-based company engaged in " advanced digital business services " to support the world's best companies. In 2023, we believe the company was a victim of its own-success during the COVID-19 outbreaks. In detail, excluding the pandemic-era effect, Teleperformance's higher growth has slowed down, and higher interest rates for longer and tighter financial conditions have lowered clients' budgets. Consumer spending has been resilient to date, but trade volumes have been negative. There are pros and cons to 2024, and we continue to see a market deterioration in our estimate. That said, we believe Teleperformance might deliver a long-term return. This is based on 1) AI upside, 2) supportive Majorel acquisition, and 3) solid capital allocation priorities with growing dividend per share estimates....
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Teleperformance: AI Upside To Price In