Topic: How To Invest

Spinoffs & Takeovers Hotline – Friday, April 16, 2021

Article Excerpt

CONDUENT INC., $7.05, symbol CNDT on New York, provides business-process outsourcing services, commonly referred to as BPO, to transaction-heavy companies. Xerox spun off the company on January 3, 2017. Conduent offers expertise and scale in labour-intensive processes that clients do not have the capability to profitably operate themselves. Contracts are three to five years in duration, and Conduent utilizes learning-curve advantages to increase efficiency every year. That helps clients maintain or increase profit margins. Roughly 90% of the company’s revenue is recurring under long-term contracts. The client list includes most Fortune 100 businesses. Over 500 government entities in over 23 countries are also clients. Customer concentration is low: the largest customer represents only 4% of revenue. The top 10 customers as a group represent 20% of revenue. In health-care markets, Conduent serves 18 of the top 20 managed health-care plans. In transportation markets, it is the largest commercial vehicle service provider, and the second-largest toll-collection service provider. In January 2017, under pressure from…

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