TASK Stock Study (12-1-25)

Posted by Mark on May 16, 2025 at 07:53 | Last modified: December 1, 2025 08:25

I recently did a stock study on TaskUs, Inc. (TASK, $11.37).

M* writes:

     > TaskUs Inc is a provider of outsourced digital services and
     > next-generation customer experience to the world-wide Game-
     > changing companies, helping its clients represent, protect
     > and grow their brands. It serves clients in the fastest-
     > growing sectors, including social media, e-commerce,
     > gaming, streaming media, food delivery and ridesharing,
     > HiTech, FinTech and HealthTech.

Since 2020 (’21, when public trading begins, excluded from full analysis due to negative earnings), this small-size company has grown sales and earnings at annualized rates of 20.1% and 9.6%, respectively. Lines are mostly up, straight, and parallel except for sales dip in ’23. Data is very scant but the encouraging first four years and steep stock selloff gets me interested.

Over the past decade, PTPM leads peer and industry averages while ranging from 6.7% in ’22 to 9.3% in ’20 with a last-5-year mean of 7.9%. ROE averages 9.2% from ’22-’24. Debt-to-Equity is less than peer and industry averages while averaging 42.5% from ’22-’24.

Quick Ratio is 2.6 and Interest Coverage 7.2 per M* who gives a C grade for Financial Health (BI website). Value Line (VL) gives a B rating for Financial Strength.

With regard to sales growth:

• YF gives YOY ACE 18.0% and 7.9% for ’25 and ’26, respectively (based on 7 analysts).
• Zacks gives YOY ACE 18.1% and 9.0% for ’25 and ’26, respectively (3 analysts).
• CFRA gives ACE 18.0% YOY and 12.8% per year for ’25 and ’24-’26, respectively (7).
• M* gives 2-year annualized ACE of 11.5%.

My 4.0% forecast is below the range.

With regard to EPS growth:

• MarketWatch gives ACE 9.4% and 11.5%/year for ’24-’26 and ’24-’27, respectively (based on 7 analysts).
• Nasdaq.com gives ACE 7.8% YOY and 6.7%/year for ’26 and ’25-’27 (3 / 3 / 2 analysts for ’25, ’26, and ’27).
• Finviz gives ACE 5-year annualized growth of 10.6% (4).
• YF gives YOY ACE 21.6% and 0.8% for ’25 and ’26, respectively (7).
• Zacks gives YOY ACE 15.5% and 9.4% for ’25 and ’26, respectively (3).
• VL gives ACE 45.2% annualized growth from ’24 through ’26-’27.
• CFRA gives ACE 214% YOY and 77.8% per year for ’25 and ’24-’26, respectively (7).

My 7.0% forecast is below the 2-longer-term-estimate range (10.6% lowest). Initial value is ’24 EPS of $0.50/share rather than 2025 Q3 EPS of $0.89 (TTM).

My Forecast High P/E is 30.0. Over the past three years, high P/E declines from 143 to 39.2 with a mean of 76.1 and a mean average P/E of 50.2. I am below the range.

My Forecast Low P/E is 16.0. Over the past three years, low P/E ranges from 16.6 (’23) to 34.9 (’22) with a mean of 24.2. I am forecasting below the range.

My Low Stock Price Forecast of $8.00 is default based on initial value given above. This is 29.6% less than the previous close and 25.2% less than the 52-week low.

These inputs land TASK in the HOLD zone with a U/D ratio of 2.9. Total Annualized Return (TAR) is 13.2%.

PAR (using Forecast Average—not High—P/E) of 7.3% is less than I seek in a small-size company. If a healthy margin of safety (MOS) anchors the study, then I can focus on TAR instead.

To assess MOS, I normally start by comparing my inputs with those of Member Sentiment (MS). With just one other study in the last 90 days, that is a non-starter.

I feel like MOS is at least moderate if not robust because my inputs are near or below historical/analyst averages/ranges but I only have one other estimate for comparison and a very brief trading history.

With regard to valuation, PEG is 1.73 and 1.7 per M* and my projected P/E, respectively. That is about fairly valued [and in agreement]. Relative Value [(current P/E) / 5-year-mean average P/E] is dirt cheap at 0.25 but I don’t really know if the stock has settled into what the market will find its appropriate multiple.

At this point, the stock is truly one for speculative consideration only.

Per U/D, TASK is a BUY under $11.30/share. BI TAR criterion would be met [21.0 / ((14.87 / 100 ) +1 ) ^ 5] = $10.50 given a forecast high price $21 (no dividend).

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