CAPGEMINI

Analysis of Capgemini share price

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The companies in this IT activity sector are often well represented on the stock markets as they generate high turnover combined with a stable economic growth. This is the case for example with the CapGemini Company which is popular with traders across the board and which we will examine in this article.  Through reading this article you will be able to learn its current share price as well as a historical summary of the company’s growth and details on the CapGemini Company activities.  

Elements that can influence the price of this asset:

Analysis N°1

Firstly we know that the turnover and therefore the financial results of the CapGemini Group are highly sensitive to IT investments completed by companies. Another point, this turnover also depends on the workforce and the number of contracts. These factors are therefore extremely important in your long term fundamental analysis.

Analysis N°2

This CapGemini stock market asset displays a strong reactivity to announcements made by the competitive companies with a rapid increase in volatility occurring at the time of these events.  This appears to be particularly true for announcements relating to the American Accenture Group and the Indian group Infosys.

Analysis N°3

We would of course also closely follow the achievement of the strategic plan implemented by the group and which was planned to conclude in the year 2020.

Analysis N°4

Future acquisitions of the group in North America, notably anything related to blockchain solutions which are highly popular at present should be monitored closely.

Analysis N°5

Various rumours relating to a possible alliance between CapGemini and the French Orange Group continue to circulate among investors. This type of activity is therefore highly significant.

Analysis N°6

Finally, it should be noted that the CapGemini shares are only available due to a splintered capital and the fact that the employees and administrators only hold 8.9% of the capital. A foreign investor that wishes to move into Europe may therefore find it advantageous to try for a public takeover bid on this business.

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General presentation of the CapGemini Company:

The CapGemini Group is currently one of the leaders in the IT service suppliers sector worldwide. However we can actually split its activities into several distinct categories with the main sector that of the design, development and integration of IT systems. This is followed by info management services, then local IT services as well as advice and counselling.

The major part of this company’s activity is achieved in France but CapGemini is also present in England, Ireland, the Benelux countries, and Scandinavia as well as North America and Pacific Asia.

 

Know the competition to CapGemini shares:

The CapGemini Group is currently one of the largest suppliers in digital and IT services worldwide. It actually holds sixth position worldwide at present in this sector with some major brand names leading the field.

 

The strategic alliances implemented by the CapGemini Group:

 

Stock market data

Before launching into speculating on the CapGemini share price online and implementing your strategy it is important that you first analyse all the information that we have previously provided relating to the CapGemini Company, its recent history and the history of its share price on the stock markets. But here is some more information you should know about this company relating to its position on the stock markets:

 

Economic history

To assist you in better understanding how the CapGemini share price has evolved over recent years it can be advantageous to know more about the company’s economic and financial history. Here therefore are details of recent events that have influenced the CapGemini Company and its activities:

 

The advantages and strong points of CapGemini shares as stock market assets:

Firstly, the CapGemini Company benefits from a considerable advantage from its position on the European and indeed global markets in its activity sector. CapGemini is in fact in the top position in the sector of IT services in Europe and holds tenth position worldwide in this activity sector.

From a geographical point of view, CapGemini has also made great efforts to increase its presence worldwide, notably through a policy of decreasing its activities in Europe including the French, British and Irish markets in favour of the American market which is currently the major geographical market for this company. CapGemini also benefits from a growing presence in emerging markets such as the Asian countries.

Of course, the fact that CapGemini is specialised in IT services offers the company a certain advantageous position in relation to digital transition which is relevant to all businesses worldwide.

The group also counts on its offshore development to remain competitive against strong competition. In fact, CapGemini continues to develop its offshore growth with over 2/3 of its company in countries where the personnel costs, therefore that of production in general, are lower, such as India.

CapGemini can also count upon its expansion contracts to ensure profits for the coming years.  It can thereby, for example, rework its taxation obligations with the British administration to ensure a comfortable revenue over several years.

Investors and shareholders in the CapGemini Group are also reassured by the excellent visibility offered by predicted future financial results with an order book that is higher than last year’s turnover. This is a promising indication regarding the growth of the company.

Finally, the group gains points by completing payments to investors in the form of shares in a recurring manner.

 

The disadvantages and weak points of CapGemini shares as stock market assets:

Firstly it should be remembered that CapGemini exercises its activities in a sector that is highly sensitive to deflation and which is also highly competitive. The group only holds tenth position worldwide and has trouble gaining new parts of the market in this context.

The finances of the group are also particularly sensitive to the personnel costs. These costs actually represent nearly 2/3 of the operating costs of the company and can therefore prove to be debilitating.

We are also disappointed by the significant slowdown in growth of the company’s activities on the American continent.  This lack of growth is mainly due to a decrease in the growth of the energy markets, particularly the natural gas and oil markets. Concerning other markets the analysts have also communicated their doubts and anxiety relating to the future of the British market over the medium term and the possibilities of a recession that would directly influence the sales of CapGemini in this country.

Finally, although the group is increasingly developing its activities in other countries its presence in emerging countries is still insufficient compared to those of its major competitors that have long been present, notably in Pacific Asia where CapGemini only achieves 5% of its sales.

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