(Boursier.com) — After recent fears surrounding competition from AI which caused Teleperformance shares to falter on the stock market at the end of February, the value this time fell by 18% to 92 euros on the Parisian market this Thursday, sanctioned after a disappointing publication. In 2024, the group has indicated that it will adopt a cautious approach and adapt its development model to the volatile macroeconomic context. Growth in activity is expected to remain limited in the first quarter of 2024, given a very unfavorable basis of comparison and an environment that remains volatile.
The annual organic revenue growth objective is between +2% and +4% with an increase in recurring EBITA margin of between +10 and +20 points on a pro forma basis (vs. 14.9% in 2023) excluding Majorel integration costs.
Stifel highlights that the results for the 2023 financial year resulted in a net shortfall of 8%, reflecting a weaker result than expected, with lower Majorel margins and higher net financial costs. “On the positive side, the FCF generation was solid, slightly ahead of our expectations” continues the analyst. “The outlook for the 2024 financial year is reassuring in terms of revenue, which confirms our expectation of a gradual improvement throughout the year… However, we recognize that the weaker performance in Q4 does not does not contribute to giving credence to these prospects (…) If we expected a stabilization of the turnover dynamic in the fourth quarter, this is further delayed and therefore does not help our buy recommendation” .
RBC Capital (‘outperform’) notes that Q4 revenues are “significantly below expectations”. LFL’s fiscal 2024 revenue guidance “should be fine with investors,” but the margin is about 40 to 50 basis points below consensus. The broker still considers the single-digit EV/Ebitda multiple to be too cheap, but more patience will be required. Morgan Stanley (‘online weighting’) declares for its part that this is a “new unpleasant error”, with organic growth and margins lower than consensus on an ex-Majorel basis… The new forecasts for 2024 imply a drop in margins due to integration and a deterioration in consensus expectations. Free cash flow is strong, driven by working capital and reduced capital expenditures.
Citi (‘buy’) also highlights that 2023 Ebita is 4% below consensus, with fourth-quarter revenue growth “well below” expectations. The implied margin for 2024 is 15% to 15.1% vs. a consensus of 15.5%.
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