Updates – Genpact, MP Materials, Vital
Plus a new name I’m working on, and one worth watching.
▶ If you’re a new Red Flag Alerts subscriber, welcome. As a reminder, I don’t set my clock by earnings season, preferring to only chime in if something on the Red Flag Alerts list is worth mentioning. Take Genpact, for example. It beat estimates and raised guidance. Never mind that a quarter doesn’t make a trend. But beating and raising what in all likelihood was lowballed guidance is the oldest game in the book – and as I pointed out in my original red flag, with the rapid surge in generative AI, Genpact is now in what I like to call “running up a down escalator” mode. The company noted that its Advanced Technology Solutions unit grew at 17%, “as we continue to help clients rapidly deploy AI systems into production.” But overall growth for the past three quarters has been slipping, with a gain last quarter of 6.6% – virtually flat from a year ago.
Dig a little deeper into the arcane bowels of the financial statements – well beyond the headline numbers – and you can see what’s really going on for the company to get that 17% gain...