Technology Stocks

Globant SA (NYSE:GLOB) is an Interesting Story Worth a Look

Globant SA (NYSE:GLOB) shares rebounded very nicely on Friday following solid Q3 results. Non-IFRS (foreign equivalent of non-GAAP) EPS jumped 24% Yr/yr to $0.46, which was above prior guidance of $0.41-0.45.

Revenue rose 22.7% yr/yr to $134.6 mln, which also was above prior guidance of $131.5-133.5 mln. The guidance was quite strong as GLOB expects Q4 non-IFRS EPS of $0.45-0.49 and revenue of $138-140 mln as the mid-points of both were above market expectations.

Globant SA (NYSE:GLOB) said its conference call that in the US it has engaged in major long-term deals with some of its key accounts.

For example, Globant has been working for MTA for more than a year in one of its most strategic digital projects. It has also started to work with a multinational professional services firm in several data initiatives as part of the data transformation agenda. In Latin America, GLOB continued to see strong growth in its business coverage, focusing on countries like Argentina, Chile, Colombia, and Mexico.

In Europe, the company is working to help one of the leading retailers in the world to build a more scalable API platform. Also for a global leading financial institution, GLOB is working on the evolution of a mobile product that can scale to millions of consumers, while being used across several countries.

Additionally, Globant has incorporated some important logos to its portfolio. Globant is now working with Uber, supporting the deployment and integration of UberEats.

It also has added FanDuel, a leader among daily fantasy sports providers and an important brand in the recently legalized sport betting market in the US.


Skynet View

Globant SA (NYSE:GLOB) trumpets itself as a technology services company that provides services related to application development, testing, infrastructure management, and application maintenance worldwide.

Globant is a technology service provider that helps companies go digital. GLOB is based in Buenos Aires, Argentina but around 80% of its revenue comes from North America. The company is benefiting from strong demand as companies look to achieve digital transformations with artificial intelligence (AI) and Internet of Things (IoT) being a big part of these transformations. Also, GLOB is increasingly attracting larger accounts.

Historically, traditional IT providers have focused on delivering custom applications based on detailed client specs, while digital agencies emphasized creativity (visual design, user interface etc.) but without the depth of engineering expertise. GLOB says it’s a play on the ongoing paradigm shift whereby customers want IT providers to not only handle the rigorous engineering requirements of emerging technologies (mobile, social media, cashless transactions, big data etc.), but also offer creative talent normally provided by digital agencies. GLOB handles both sides of the equation.

The company offers machine learning, pattern recognition, natural language understanding, future of organizations, customer insight, behavioral change, product innovation, design thinking, product management discovery and delivery, and product coaching services.

It also provides process appraisal, automated, process evolution, delivery management, agile consultancy, management consulting, user experience, visual and service, industrial design, mobile engineering, fast prototyping, and mobile and product strategy services. In addition, the company offers game engineering and experience, digital platform, virtual and augmented reality, graphics engineering, 3D and 2D art, e-Sports, data architecture, data science, distributed platform, data integration, data visualization, and blockchain services.

Further, it provides Internet of things experience and consultancy, platform, hardware integration, content management system, e-learning, video content production, OTT, and Cloud Ops Studio services. Additionally, the company offers functional testing, load and performance testing, mobile testing, test automation, large scale Web applications, hybrid and cross-compiled development, accessibility, API management, micro, complex architecture, software archaeology, IT service management, and software evolution services, as well as services over platforms.

It serves medium- to large-sized companies operating in media and entertainment, professional services, technology and telecommunications, travel and hospitality, banks, financial services and insurance, and consumer, and retail and manufacturing industries.

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