Owner and CEO, GR20 Research

Gregory Ramirez

Owner and CEO

Industry Research and Consulting Services

GR20 Research

GR20 Research provides industry research and consulting services

Equity Bottom-Up

<ul>
<li>Capgemini's share price dropped by 10% following a below-consensus guidance for FY 2025, highlighting concerns about its underperformance compared to peers and the delayed recovery of the IT services industry.   </li>
<li>Capgemini's revenue mix, with significant exposure to manufacturing in Europe, limits its growth compared to offshore competitors like TCS, Infosys, and Cognizant, which are benefiting from recovery in financial services.   </li>
<li>Despite AI creating high expectations, its impact on bookings remains limited, causing delays in decision-making; however, AI presents significant opportunities in IT services as it drives demand for business transformation.</li>
</ul>


Capgemini's share price dropped by 10% following a below-consensus guidance for FY 2025, highlighting concerns about its underperformance compared to peers and the delayed recovery of the IT services industry.   
Capgemini's revenue mix, with significant exposure to manufacturing in Europe, limits its growth compared to offshore competitors like TCS, Infosys, and Cognizant, which are benefiting from recovery in financial services.   
Despite AI creating high expectations, its impact on bookings remains limited, causing delays in decision-making; however, AI presents significant opportunities in IT services as it drives demand for business transformation.


Capgemini SE (CAP FP): A Question of Revenue Mix

US-EU Index Rebalances / Quantitative Researcher

Dimitris Ioannidis

Global Financial Data and Analytics Platform

ORTEX

ORTEX is a global financial data and analytics platform providing real-time securities lending and short interest data, index rebalance data, holdings and insider transactions, trading signals, corporate actions and news,  stock machine learning and factor scores and other analytics. The majority of the data are downloadable and accessible through APIs.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/cap-gemini-sa" target="_blank" data-smartkarma-citation="entities:21411:1" rel="noopener">Cap Gemini SA (CAP FP)</a> is estimated to be excluded from the selection list in the long-run due to being pushed way above 60% coverage in the Technology sector.</li>
<li>
<a href="https://www.smartkarma.com/entities/merck-kgaa" target="_blank" data-smartkarma-citation="entities:21676:1" rel="noopener">Merck KGaA (MRK GR)</a> switches between in and out of the selection list because it fluctuates close to the 60% coverage of the Health Care sector.</li>
<li>
<a href="https://www.smartkarma.com/entities/nokia-oyj" target="_blank" data-smartkarma-citation="entities:21754:1" rel="noopener">Nokia OYJ (NOKIA FH)</a> has a higher probability of deletion from SX5E if <a href="https://www.smartkarma.com/entities/merck-kgaa" target="_blank" data-smartkarma-citation="entities:21676:1" rel="noopener">Merck KGaA (MRK GR)</a>  qualifies to the selection list. Forecasted passive fund supply is  ~15 ADV.   </li>
</ul>



Cap Gemini SA (CAP FP) is estimated to be excluded from the selection list in the long-run due to being pushed way above 60% coverage in the Technology sector.

Merck KGaA (MRK GR) switches between in and out of the selection list because it fluctuates close to the 60% coverage of the Health Care sector.

Nokia OYJ (NOKIA FH) has a higher probability of deletion from SX5E if Merck KGaA (MRK GR)  qualifies to the selection list. Forecasted passive fund supply is  ~15 ADV.   


<ul>
<li>
<a href="https://www.smartkarma.com/entities/nokia-oyj" target="_blank" data-smartkarma-citation="entities:21754:1" rel="noopener">Nokia OYJ (NOKIA FH)</a> is currently the lowest ranked security in SX5E but still above the exit threshold. Its potential deletion can cause the addition of <a href="https://www.smartkarma.com/entities/dsm-firmenich-ag" target="_blank" data-smartkarma-citation="entities:43730:1" rel="noopener">DSM-Firmenich (DSFIR NA)</a>. </li>
<li>
<a href="https://www.smartkarma.com/entities/deutsche-post-ag" target="_blank" data-smartkarma-citation="entities:21608:1" rel="noopener">Deutsche Post (DHL GR)</a> &amp; <a href="https://www.smartkarma.com/entities/reckitt-benckiser-group-plc" target="_blank" data-smartkarma-citation="entities:22105:1" rel="noopener">Reckitt Benckiser (RKT LN)</a> are below the SX5P exit threshold. Their deletion can cause the addition of <a href="https://www.smartkarma.com/entities/intesa-sanpaolo-spa" target="_blank" data-smartkarma-citation="entities:21200:1" rel="noopener">Intesa Sanpaolo (ISP IM)</a> &amp; <a href="https://www.smartkarma.com/entities/banco-bilbao-vizcaya-argentari" target="_blank" data-smartkarma-citation="entities:21251:1" rel="noopener">Banco Bilbao (BBVA SM)</a> .</li>
<li>
<a href="https://www.smartkarma.com/entities/cap-gemini-sa" target="_blank" data-smartkarma-citation="entities:21411:1" rel="noopener">Cap Gemini SA (CAP FP)</a> and <a href="https://www.smartkarma.com/entities/compass-group-plc" target="_blank" data-smartkarma-citation="entities:21880:1" rel="noopener">Compass (CPG LN)</a> are examples of companies with significant market caps which are excluded due to supersector coverage. </li>
</ul>



Nokia OYJ (NOKIA FH) is currently the lowest ranked security in SX5E but still above the exit threshold. Its potential deletion can cause the addition of DSM-Firmenich (DSFIR NA). 

Deutsche Post (DHL GR) &amp; Reckitt Benckiser (RKT LN) are below the SX5P exit threshold. Their deletion can cause the addition of Intesa Sanpaolo (ISP IM) &amp; Banco Bilbao (BBVA SM) .

Cap Gemini SA (CAP FP) and Compass (CPG LN) are examples of companies with significant market caps which are excluded due to supersector coverage. 


STOXX 50: First September Forecasts for Europe and Eurozone

Quality-first, Business-perspective, Long-term, Urbem (HK) Limited

Urbem Capital

Quality-first, Business-perspective, Long-term

<ul>
<li>Although engaged in the IT field, Bouvet is essentially a people business that is not built upon any technology product;</li>
<li>For a people business to succeed, corporate culture is a primary factor, and Bouvet seems to have fared pretty well on that front.</li>
<li>We had a one-hour chat with the company's new CEO and CFO last year and were impressed by the team's conservative thinking.</li>
</ul>


Although engaged in the IT field, Bouvet is essentially a people business that is not built upon any technology product;
For a people business to succeed, corporate culture is a primary factor, and Bouvet seems to have fared pretty well on that front.
We had a one-hour chat with the company's new CEO and CFO last year and were impressed by the team's conservative thinking.


Introducing Bouvet: A Simple Business Built upon a Complex World

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<p>The long-drawn-out battle between <a href="https://www.smartkarma.com/entities/cap-gemini-sa" target="_blank" data-smartkarma-citation="entities:21411:1" rel="noopener">Cap Gemini SA (CAP FP)</a> and Elliott Management for <a href="https://www.smartkarma.com/entities/altran-technologies-sa" target="_blank" data-smartkarma-citation="entities:21386:1" rel="noopener">Altran Technologies Sa (ALT FP)</a> has taken several steps towards a resolution. The reopened tender offer closed on 10 February with the result expected in the next week. Altran reported its 4Q19 results the next day (11 February). Also, it was announced last week that the Paris Court of Appeal will give its decision on 19 March.</p><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/capgemini-altran-tender-offer-next-moves-for-holdout-shareholders" target="_blank" rel="noopener">our previous note</a>, we analysed the options of the holdout shareholders which we categorised into three buckets – Elliott, traders/short-term holders and long-term believers. We viewed Altran’s 4Q results as a key upcoming catalyst. Post the results, the optionality of the holdout shareholders have become more polarised. </p></div><p><strong>Smartkarma Webinar | Capgemini/​Altran Tender Offer (1700hrs Singapore time on 12 February 2020) -</strong> We will discuss next moves for holdout shareholders in a webinar moderated by Smartkarma's <a href="https://www.smartkarma.com/profiles/jon-foster" target="_blank" data-smartkarma-citation="accounts:8" rel="noopener">Jon Foster</a>.</p>

The long-drawn-out battle between Cap Gemini SA (CAP FP) and Elliott Management for Altran Technologies Sa (ALT FP) has taken several steps towards a resolution. The reopened tender offer closed on 10 February with the result expected in the next week. Altran reported its 4Q19 results the next day (11 February). Also, it was announced last week that the Paris Court of Appeal will give its decision on 19 March.In our previous note, we analysed the options of the holdout shareholders which we categorised into three buckets – Elliott, traders/short-term holders and long-term believers. We viewed Altran’s 4Q results as a key upcoming catalyst. Post the results, the optionality of the holdout shareholders have become more polarised. Smartkarma Webinar | Capgemini/​Altran Tender Offer (1700hrs Singapore time on 12 February 2020) - We will discuss next moves for holdout shareholders in a webinar moderated by Smartkarma's Jon Foster.

Capgemini/Altran Tender Offer: Optionality Shifts to Long-Term Investors

France

Capgemini offers information technology services. The Company provides mobile software solutions, business process management, outsourcing, cloud computing, finance, consulting, supply chain management, engineering, and other services. Capgemini serves aerospace, defense, automotive, health care, life science, telecom, media, and entertainment industries worldwide.

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Capgemini (CAP FP)

Capgemini SE (CAP FP): A Question of Revenue Mix

Capgemini's underperformance and revenue mix limitations raise concerns about its growth compared to offshore competitors, despite high...

Gregory Ramirez

EURO STOXX 50: Exclusion by Sector

Merck KGaA's fluctuating ranking in the Health Care sector impacts the probability of Nokia's deletion from EURO STOXX 50 which can cause a passive...

Dimitris Ioannidis

STOXX 50: First September Forecasts for Europe and Eurozone

In SX5E, Nokia might be replaced by DSM-Firmenich, while in SX5P Reckitt Benckiser and Deutsche Post may be replaced by Intesa Sanpaolo and Banco...

Dimitris Ioannidis

Introducing Bouvet: A Simple Business Built upon a Complex World

There is this small group of technology-driven businesses that are relatively immune to complexity and obsolescence risks but can enjoy industry...

Urbem Capital

Capgemini/Altran Tender Offer: Optionality Shifts to Long-Term Investors

The long-drawn-out battle between Cap Gemini SA (CAP FP) and Elliott Management for Altran Technologies Sa (ALT FP) has taken several steps towards...

Arun George

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Capgemini SE (CAP FP): A Question of Revenue Mix

​Capgemini's underperformance and revenue mix limitations raise concerns about its growth compared to offshore competitors, despite high...

Gregory Ramirez

EURO STOXX 50: Exclusion by Sector

Merck KGaA's fluctuating ranking in the Health Care sector impacts the probability of Nokia's deletion from EURO STOXX 50 which can cause a passive...

Dimitris Ioannidis

STOXX 50: First September Forecasts for Europe and Eurozone

​In SX5E, Nokia might be replaced by DSM-Firmenich, while in SX5P Reckitt Benckiser and Deutsche Post may be replaced by Intesa Sanpaolo and Banco...

Dimitris Ioannidis

Introducing Bouvet: A Simple Business Built upon a Complex World

There is this small group of technology-driven businesses that are relatively immune to complexity and obsolescence risks but can enjoy industry...

Urbem Capital

Capgemini/Altran Tender Offer: Optionality Shifts to Long-Term Investors

The long-drawn-out battle between Cap Gemini SA (CAP FP) and Elliott Management for Altran Technologies Sa (ALT FP) has taken several steps towards...

Arun George

Capgemini's underperformance and revenue mix limitations raise concerns about its growth compared to offshore competitors, despite high...

In SX5E, Nokia might be replaced by DSM-Firmenich, while in SX5P Reckitt Benckiser and Deutsche Post may be replaced by Intesa Sanpaolo and Banco...