Paris, France – Teleperformance SE, a multinational business services provider, has seen its stock price plummet by nearly 40% since November. The decline, which brings the share price to under €90, marks a significant drop from the levels seen at the time of the initial article in 2023. Despite the challenges the company has faced, including modest revenue growth in 2023 and concerns about profitability, there are indications that the stock may now present a compelling buying opportunity.

In a recent update, the author of the original article highlights the key factors contributing to the decline in Teleperformance’s stock price, including the impact of the pandemic on performance and the acquisition of Majorel. While the acquisition is expected to bolster sales, there are concerns about its effect on profitability in the near term. Additionally, the author emphasizes the importance of margin expansion and synergy realization in driving future growth for the company.

A closer look at Teleperformance’s balance sheet reveals a significant increase in net debt following the acquisition of Majorel. The company faces the challenge of reducing its leverage ratio to maintain its credit rating, with a focus on debt paydown and potential adjustments to shareholder returns. Despite the elevated debt levels, management remains committed to returning a significant portion of free cash flow to shareholders.

From a valuation perspective, Teleperformance shares appear undervalued, with the market pricing the stock for terminal decline. However, the author argues that the current valuation discounts the company’s long-term growth potential and overlooks the impact of the Majorel acquisition. With a conservative approach to valuation and consideration for potential future risks, there is a strong case for investing in Teleperformance at its current price.

Ultimately, the article concludes with the author’s decision to initiate a position in Teleperformance stock, highlighting the potential for future growth and adding a new perspective to the ongoing discussion about the company. As investors evaluate their options in the market, Teleperformance’s performance and strategic initiatives continue to be of interest to stakeholders seeking opportunities in the business services sector.