TTEC Holdings, Inc. (NASDAQ: TTEC)

Sector: Technology Industry: Information Technology Services CIK: 0001013880
Market Cap 171.96 Mn
P/B 0.65
P/E -9.57
P/S 0.08
ROIC (Qtr) 33.29
Div Yield % 0.00
Rev 1y % (Qtr) -1.94
Total Debt (Qtr) 983.51 Mn
Debt/Equity (Qtr) 3.73

About

TTEC Holdings, Inc. (TTEC), a prominent player in the customer experience outsourcing industry, has established itself as a trusted partner for marquis and disruptive brands, as well as public sector clients. Since its inception in 1983, the company has grown to become a leading provider of technology-enabled customer experiences, operating across digital and live interaction channels. TTEC's mission is to help its clients increase customer loyalty, revenue, and profitability through the design, building, and operation of these experiences. The...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 73.51M provide 2.15x coverage of short-term debt 34.18M, demonstrating strong liquidity position and minimal refinancing risk.
  • Tangible assets of 966.41M provide exceptional 13.93x coverage of deferred revenue 69.40M, showing strong service capability backing.
  • Robust tangible asset base of 966.41M provides 3.55x coverage of working capital 272.48M, indicating strong operational backing.
  • Operating cash flow of 117.42M fully covers other non-current liabilities 18.97M by 6.19x, showing strong long-term stability.
  • Cash reserves of 73.51M provide solid 3.87x coverage of other non-current liabilities 18.97M, indicating strong liquidity.

Bear case

  • Free cash flow of 132.31M provides weak coverage of capital expenditures of (14.89M), with a -8.89 ratio suggesting additional external financing needs for growth initiatives.
  • Operating earnings of 96.78M show weak coverage of depreciation charges of 91.31M, with a 1.06 ratio indicating high capital intensity and potential reinvestment needs.
  • High depreciation of 91.31M relative to operating cash flow of 117.42M, which is 0.78x suggests significant maintenance capital requirements affecting free cash flow.
  • Free cash flow of 132.31M represents just -0.91x of debt issuance (146M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Operating cash flow of 117.42M barely covers operating expenses of 104.51M with a 1.12 ratio, suggesting thin operational efficiency margins and limited flexibility.

Peer comparison

Companies in the Information Technology Services
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 IBM International Business Machines Corp 279.99 Bn 35.41 4.28 66.57 Bn
2 ACN Accenture plc 168.17 Bn 22.09 2.38 8.20 Bn
3 INFY Infosys Ltd 74.96 Bn 23.74 3.89 -
4 CTSH Cognizant Technology Solutions Corp 41.45 Bn 19.48 1.99 1.17 Bn
5 FIS Fidelity National Information Services, Inc. 35.21 Bn 231.62 3.36 13.00 Bn
6 WIT Wipro Ltd 29.93 Bn 19.70 2.97 1.95 Bn
7 BR Broadridge Financial Solutions, Inc. 26.38 Bn 28.51 3.74 3.28 Bn
8 LDOS Leidos Holdings, Inc. 23.72 Bn 16.88 1.37 5.23 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.64 1.44
EV to Cash from Ops. EV/CFO 9.23 5.63
EV to Debt EV to Debt 1.10 8.06
EV to EBIT EV/EBIT 11.20 -4.05
EV to EBITDA EV/EBITDA 6.69 -0.52
EV to Free Cash Flow [EV/FCF] EV/FCF 8.19 -1.66
EV to Market Cap EV to Market Cap 6.30 1.35
EV to Revenue EV/Rev 0.51 57.14
Price to Book Value [P/B] P/B 0.65 3.34
Price to Earnings [P/E] P/E -9.57 -5.47
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 -0.83
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 0.66
Dividend per Basic Share Div per Share (Qtr) 0.00 0.47
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 6.24
Interest Coverage Int. cover (Qtr) 1.28 -319.17
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 130.13 -253.62
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -24.16 114.15
Dividend Growth (1y) % Div 1y % (Qtr) 0.00 35.23
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 63.33 -22.49
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 322.75 -25.03
EBIT Growth (1y) % EBIT 1y % (Qtr) 154.05 -82.44
EBT Growth (1y) % EBT 1y % (Qtr) 107.96 97.07
EPS Growth (1y) % EPS 1y % (Qtr) 94.71 147.29
FCF Growth (1y) % FCF 1y % (Qtr) 274.97 -8,638.64
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -3.29 -8.24
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.27 0.78
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.01
Cash Ratio Cash Ratio (Qtr) 0.20 0.66
Current Ratio Curr Ratio (Qtr) 1.75 2.12
Debt to Equity Ratio Debt/Equity (Qtr) 3.73 0.88
Interest Cover Ratio Int Coverage (Qtr) 1.28 -319.17
Times Interest Earned Times Interest Earned (Qtr) 1.28 -319.17
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 8.80 -550.76
EBIT Margin % EBIT Margin % (Qtr) 4.53 -775.74
EBT Margin % EBT Margin % (Qtr) 0.98 -827.89
Gross Margin % Gross Margin % (Qtr) 21.50 24.07
Net Profit Margin % Net Margin % (Qtr) -0.80 -830.34