CONCENTRIX CORPORATION (CNXC): what the price requires
The current priced-in claim for CONCENTRIX CORPORATION (CNXC) is temporarily suppressed because the live engine record is unavailable. The dated report remains a snapshot, not a current market read.
Generated: 2026-07-19 · Source: https://boothcheck.com/report/CNXC
Headline
| Field | Value |
|---|---|
| Ticker | CNXC |
| Company | CONCENTRIX CORPORATION |
| Current price | $24.46/sh |
What The Price Requires (Inversion)
The assumption today's price embeds, recovered by inverting the valuation.
| Field | Value |
|---|---|
| Inversion basis | whole-company |
| Operating margin needed | 2.5% |
| Operating margin today | 5.2% |
| Margin compression implied | -2.7pp |
| Multiple paid | 13x operating income |
The operating-margin requirement is derived from the framework's value band at year 9, a separately labeled basis from the headline growth/duration solve.
The price sits below what even a 5%/yr operating-profit decline would warrant; the inversion reports a bound, not a solved growth path.
Solve inputs: computed at a 7% cost of capital with 4% terminal growth over a 5-year stage (computed at the 7% minimum rate; the CAPM rate 4.8% sits below it).
Reconcile: at the x-ray's 9.3% required return this reads ~4%/yr; the models below use their own rates.
How unusual the bet is: within-range
| Reference | Value |
|---|---|
| vs own history | +0.13σ |
| cohort percentile (of 212 peers) | 27 |
| implied end-window share | 0% |
Valuation X-Ray
The price is supported by asset-based and relative-multiple value. A value/asset-supported name, not a pure growth bet.
How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.
| Family | Median price/FV | Models | Reads |
|---|---|---|---|
| Asset | 0.60x | 3 | justifies |
| Earnings | — | 0 | — |
| Relative | 0.10x | 3 | justifies |
| Growth | 1.36x | 3 | expensive |
Families that justify the price: Asset, Relative
The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 4.9%); the inversion above states its own rate.
Per-Model Detail (n=9)
| Model | Family | FV | Price/FV | Applicable | Methodology |
|---|---|---|---|---|---|
| DCF Perpetual Growth | Growth | — | — | no | — |
| DCF Exit Multiple | Growth | $50.58 | 0.48x | yes | Exit EV/EBITDA: 9.1x / 11.1x / 13.1x (bear / base = today's held flat / bull), 5yr |
| Relative Valuation | Relative | $243.57 | 0.10x | yes | P/S fallback (negative EPS): Sector P/S 1.5x × TTM revenue — excluded from consensus |
| Simple DDM | Growth | $1.39 | 17.59x | yes | DPS $1.51, g=-47.6% (sustainable: ROE (TTM) × retention; not the terminal-growth assumption), ke=9.3% |
| Two-Stage DDM | Growth | $-18.66 | — | no | Stage 1: -200% for 5yr, Stage 2: 3.5% perpetual |
| Simple Excess Return | Asset | $45.49 | 0.54x | yes | Reference only (book value floor): BV/sh $45.49, ROE negative |
| Two-Stage Excess Return | Asset | $40.94 | 0.60x | yes | Reference only (book value with convergence): BV/sh $45.49, ROE converges to ke |
| Discounted Future Market Cap | Growth | $17.96 | 1.36x | yes | Rev $10.0B, growth 4% (input: historical growth; tapered), Terminal P/S: 0.1x / 0.2x / 0.2x (bear / base = today's held flat / bull, cap 8x) |
| Peter Lynch Fair Value | Relative | $0.00 | — | no | Negative/zero EPS — earnings-based value floored at $0 |
| Margin Trajectory | Growth | — | — | no | — |
| Earnings Power Value | Earnings | $0.01 | 2445.50x | yes | Normalized EBIT (5y avg op income, one-time charges added back) $0.31B × (1−25%) / WACC 4.9% → EPV (no growth) (excluded from median) |
| Residual Income | Asset | — | — | no | — |
| Graham Number | Asset | — | — | no | — |
| EV/EBITDA Relative | Relative | $53.96 | 0.45x | yes | EBITDA $0.63B × sector EV/EBITDA 14.0x |
| FCF Yield | Earnings | $0.01 | 2445.50x | yes | FCF $484.6M / Kₑ 9.3% — zero-growth perpetuity (excluded from median) |
| SBC-Adj FCF Yield | Earnings | $0.01 | 2445.50x | yes | SBC-adj FCF $0.38B (FCF $0.48B − SBC $0.10B) capitalized at Kₑ (excluded from median) |
| Ben Graham Formula | Earnings | — | — | no | — |
| ROIC-Justified P/B | Asset | $10.02 | 2.44x | yes | BV $45.49 × (ROIC 1.1% / WACC 4.9%) |
| P/Sales Sector | Relative | $243.57 | 0.10x | yes | Revenue $9.95B × sector P/S 1.5x |
| PEG Fair Value | Relative | — | — | no | — |
| Earnings Yield | Earnings | — | — | no | — |
| Funds From Operations Multiple | Relative | — | — | no | — |
| Clinical Phase NPV | Growth | — | — | no | — |
| Merton | Asset | — | — | no | — |
| V5 Mechanical | — | — | — | no | — |
Solvency
| Field | Value |
|---|---|
| Net debt | $4.4b |
| Net debt / NOPAT (after-tax) | 11.49x |
| Net debt / operating income (pre-tax) | 8.63x |
| Share count CAGR (dilution) | 4.2% |
| Burning cash | no |
Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.
Bullet Takeaways
The headline says Concentrix lost nearly a billion dollars at the operating line last year, but almost all of it is a non-cash item: a $1,523.3 million goodwill impairment tied to the depressed stock price and the Webhelp acquisition. Underneath it, fiscal 2025 cash from operations was a record $807 million and adjusted free cash flow was $626 million.
That gap is why the stock is cheap. At $25.08 it trades around half of book value of about $45 per share, and the cash-flow methods land far above the price. This is a value/asset-supported name, not a growth story.
The reason it is cheap is the reason to be careful: the market is pricing in that generative and agentic AI erode demand for customer-experience outsourcing faster than Concentrix can use the same AI to cut its own costs. Management trimmed 2026 operating income guidance, carries meaningful Webhelp-related debt, and depends on a concentrated client base.
Bull Case
The most surprising thing in the numbers is that the company that just reported a roughly $968 million operating loss also generated a record $807 million of cash from operations and $626 million of adjusted free cash flow in the same fiscal year. Both are true because the loss is almost entirely a $1,523.3 million non-cash goodwill impairment, taken in the fourth quarter of fiscal 2025 primarily because the company's own stock price and market capitalization had fallen, related to the Webhelp acquisition. Accounting wrote down the carrying value of a past deal; it did not touch the cash the operating business throws off. So the right starting point is not the loss, it is the fact that this is a real, scaled, cash-generative services business trading as if it were impaired in substance rather than on paper.
That reframes the valuation. At $25.08 (June 27, 2026) the stock trades near half of book value of about $45 per share, and the cash-flow and asset methods land far above the price: the exit-multiple DCF near $51, the EV/EBITDA-relative read near $54, and the book-value reference floor near $45. Concentrix is one of the largest customer-experience providers in the world, offering an integrated combination of technology and services delivered globally at scale, including digital-transformation services that engineer CX solutions and build customer loyalty (FY2025 10-K, accession 0001803599-26-000027). Revenue is still growing, up 5.4% to $2.5 billion in the first quarter of fiscal 2026, and the Webhelp integration is producing synergies that should expand non-GAAP operating margins as they land.
The AI question that scares the market may actually be the bull case if Concentrix is on the right side of it. The company is explicitly building AI into its offering: it advises clients on technology strategy, designs and runs enterprise applications such as self-service AI bots and GenAI-powered platforms, and positions itself to deliver those at scale (FY2025 10-K, accession 0001803599-26-000027). The same automation that could shrink seat-based call volumes also lets Concentrix deliver outcomes with fewer people at higher margin, and to sell the AI transformation itself as a service. Management's 2026 plan leans on exactly that combination of cost control, Webhelp synergies, and AI-driven efficiency, and it set a 2026 cash-flow target that points to continued free-cash-flow generation. For a buyer, the package is a high-single-digit-percent free-cash-flow yield, a falling but still real revenue base, and a balance sheet that the cash flow can de-lever. If the AI fear proves overdone, the gap between a half-of-book price and the cash-flow methods near $50 is the upside.
Bear Case
The structural truth a holder has to face is that this stock is cheap because of what is deteriorating, not because the market missed something. The $1.5 billion goodwill write-down was triggered by the stock price and market cap falling, which is the market's verdict that the Webhelp-era earnings power is worth less than what was paid for it. The central fear is concrete: generative and agentic AI threaten the core economics of customer-experience outsourcing, where a meaningful share of revenue is seat-based and volume-driven. Concentrix concedes the competitive stakes, warning that if it does not employ new technologies, including agentic AI and GenAI, as quickly or efficiently as competitors, or if rivals develop more cost-effective or client-preferred technologies, its position could suffer (FY2025 10-K, accession 0001803599-26-000027). A business whose value depends on selling labor by the seat is structurally exposed to a technology designed to remove seats, and that is a hard overhang to value through.
The guidance is moving the wrong way, which keeps the value-trap risk alive. Management cut full-year 2026 operating income guidance to $636 million to $686 million from an earlier $687.5 million to $737.5 million, and first-quarter results showed revenue growing while margins and net income declined. That is the classic profile of a business growing the top line by accepting worse economics, the opposite of the margin expansion the synergy story promises. The company also flags utilization risk directly: if it fails to anticipate client volumes correctly, a reduction in volumes and margins, loss of clients, or penalties can follow (FY2025 10-K, accession 0001803599-26-000027). In a demand environment where clients are actively testing AI to reduce their outsourced volumes, mis-forecasting utilization is more likely, not less.
The balance sheet removes the margin for error. The Webhelp acquisition was debt-financed, leaving net debt around $4.5 billion, with term loans converted via cross-currency swaps into synthetic fixed euro debt at weighted-average rates around 3.43% to 3.69% (FY2025 10-K, accession 0001803599-26-000027). That leverage is serviceable while free cash flow holds, but it leaves little room if revenue and margins erode together. Layer on client concentration, about 19% of accounts receivable at fiscal year-end 2025 sat with just five clients (accession 0001803599-26-000027), and a single large client cutting volumes or moving to an AI alternative becomes material. Add a share count that rose about 4% from the Webhelp deal, diluting per-share value, and the bear case is a leveraged, concentrated, AI-exposed services business whose cheapness is the price of a real and unresolved threat. Cheap and deteriorating can stay cheap for a long time.
Valuation
The reported earnings are useless for valuation this year because they are dominated by the $1.5 billion non-cash goodwill impairment, which drives the trailing operating margin to roughly negative 10% and knocks out every earnings-based method (the earnings-power and yield reads collapse to artifacts and should be ignored). The honest anchors are book value and cash flow. Book value is about $45 per share, so at $25.08 the stock trades near 0.55x book, and the book-value reference floor and convergence reads land near $41 to $45. On cash flow, the exit-multiple DCF lands near $51 and the EV/EBITDA-relative read near $54. The market price sits well below all of them, which is why the engine reads this as a value, asset-supported name rather than a growth bet.
The cleaner frame is the free-cash-flow yield. Concentrix generated $626 million of adjusted free cash flow in fiscal 2025 against a market value in the low-to-mid single billions, which is a high-single-digit to low-double-digit free-cash-flow yield, and management has guided to continued free-cash-flow generation in 2026. A double-digit free-cash-flow yield on a business that is still growing revenue would be cheap if the cash flow were stable. The entire valuation question reduces to one judgment: is the free cash flow durable, or is it the runoff of a model that AI is structurally eroding? The 2026 operating-income guidance cut and the AI overhang are the reasons the market refuses to pay up. If the cash flow holds and the Webhelp synergies plus AI-efficiency program protect margins, the stock is materially undervalued against the $45-to-$54 cluster. If AI compresses volumes faster than costs come out, the low price is correct and the cash flow drifts toward the bearish reads. The balance sheet, with net debt near $4.5 billion, magnifies whichever way it breaks.
Catalysts
The defining recent event was the fiscal 2025 result: a fourth-quarter and full-year non-cash goodwill impairment of $1,523.3 million, primarily reflecting the company's stock price and market capitalization, which produced a full-year operating loss near $918 million even as cash from operations hit a record $807 million and adjusted free cash flow reached $626 million. The market reaction was sharp on the headline loss. (Sources: Concentrix Q4 and FY2025 results via the company investor relations site and Longbridge; goodwill-impairment coverage via Fintool and MEXC News.)
The next hard catalyst is imminent: Concentrix reports fiscal second-quarter 2026 results after the close on Monday, June 29, 2026. Guidance for the quarter calls for revenue around $2.5 billion and EPS of about $2.57 to $2.69, and the company cut full-year 2026 operating income guidance to $636 million to $686 million from an earlier $687.5 million to $737.5 million, with full-year EPS guided to roughly $11.48 to $12.07. The print will test whether Webhelp synergies and AI-efficiency gains are offsetting demand and margin pressure. (Sources: Concentrix Q2 2026 guidance via The Markets Daily; Q2 2026 earnings schedule via StockTitan and MarketBeat.)
The forward watch items center on the AI question: whether generative and agentic AI is shrinking or growing Concentrix's addressable work, the pace of Webhelp synergy capture and margin recovery, client retention given the concentration in a handful of large accounts, and de-leveraging progress against the roughly $4.5 billion net-debt load. Each quarterly free-cash-flow print is the key check on whether the value case or the value-trap case is winning. (Sources: Simply Wall St analyses of Concentrix valuation, AI concerns, and Webhelp leverage; Concentrix FY2025 10-K.)
Peer Cohorts (Per Segment, With Filing Citations)
Core business (reported)
- EXLS (EXLSERVICE HOLDINGS, INC.)
- FY2025 10-K: …offset by a foreign exchange gain, net of hedging of $3.7 million. Gross margin in Healthcare and Life Sciences remained flat during fiscal 2025, compared to fiscal 2024. The increase in cost of revenues in Banking, Capital Markets and Diversified Industries by $30.2 million for fiscal 2025 was primarily due to…
- FY2025 10-K: …from our existing clients by 7.5% and new clients by 0.8% during fiscal 2025, compared to fiscal 2024. Revenue growth in Healthcare and Life Sciences by 23.7% was driven by the expansion of business from our existing clients by 22.4% and new clients, including revenue from ITI Data, by 1.3% during fiscal 2025,…
- MMS (Maximus, Inc.)
- FY2025 10-K: …customer services, and advanced technologies for modernization. We support programs and deliver services in the United Kingdom, including the Functional Assessment Services (FAS) contract and the Restart employment program. We also provide services in Canada and the Middle East. 62 Table of Contents Table 3.1:…
- FY2025 10-K: …changes to programs in anticipation of these changes. The nature, extent and timing of these changes is still uncertain. We anticipate operating margins for the U.S. Services Segment in fiscal year 2026 to range between 10% and 11%. 37 Table of Contents Outside the U.S. Segment Our Outside the U.S. Segment provides…
- TNET (TRINET GROUP, INC.)
- FY2025 10-K: …to estimate our beginning WSEs for the next period and, as a result, can be used as an indicator of our potential future revenue growth, business growth, and client retention. Total WSEs decreased 10% when compared to the same period in 2024, primarily due to declines in our Technology, Professional Services, and…
- FY2025 10-K: …mergers and acquisitions, changes in medical utilization and related costs, client business failure and liquidity issues, the effects of competition, pricing of our services, and client decisions to administer all or a portion of their HR needs in-house without using our services. Client attrition for any of the…
- AMTM (Amentum Holdings, Inc.)
- FY2025 10-K: …constantly competing for project awards based on pricing, schedule and the breadth and technical sophistication of our services. Some of our competitors have made or could make acquisitions of businesses or establish agreements among themselves or third parties, which could allow them to offer more competitive and…
- FY2025 10-K: &E capabilities and our customers' increasing focus on efficiency will enable us to compete effectively. Our ability to replicate modernization efforts across new end markets and various stages of the government lifecycle will expand our addressable market and enable growth in excess of our customers' underlying…
- BR (BROADRIDGE FINANCIAL SOLUTIONS, INC.)
- FY2025 10-K: …were on Broadridge's trading platforms in both the current and prior year periods. Position Growth and Internal Trade Growth are useful non-financial metrics for investors in understanding how management measures and evaluates Broadridge's ongoing operational performance within its Investor Communication Solutions…
- FY2025 10-K: …Revenues and Recurring revenue are useful metrics for investors in understanding how management measures and evaluates the Company's ongoing operational performance. See "Results of Operations" as well as Note 2, "Summary of Significant Accounting Policies" and Note 3, "Revenue Recognition" to our Consolidated…
Methodology Note
- Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
- Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
- Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
- Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.
Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.