Ibex Limited (IBEX) Stock Forecast & Price Target

IBEX Ltd is experiencing a notable positive trajectory with management increasing the midpoints of its FY25 revenue guidance by $10 million to $530 million, alongside a return to revenue growth at a 6.1% year-over-year increase. The company is positioned for further margin expansion through its artificial intelligence initiatives and a strategic shift towards off- and near-shore services, which has increased to 77% in F4Q24. Additionally, the growth in new logos has strengthened its client base, with a significant number of clients generating substantial annual revenues, supporting a favorable outlook for the company’s financial performance.

IBEX Ltd has experienced a decline in higher-margin onshore work, which dropped from 26% of total revenue in F4Q23 to 23% in F4Q24, indicating a shift towards lower-margin offshore delivery models. Significant decreases in revenue contribution from key verticals such as FinTech and Telecommunications have raised concerns, with FinTech revenue declining to 13.7% from 16.5% year-over-year, while Telecommunications dropped from 15.1% to 14.5%. Furthermore, external factors such as political instability and labor market changes pose additional risks, potentially exacerbating revenue growth deceleration and increasing operating leverage challenges.