Exela’s Management Is Brilliant: Debt Reduction And FCF Generation


  • Exela is a global business process automation company with operations in the United States, Europe, and other regions.
  • The company believes that it can reduce its debt from $1.35 billion to close to $1 billion while at the same time increasing FCF in 2022.
  • In my opinion, debt reduction would most likely lead to an increase in the stock price.
  • I continue believing that Exela will most likely deliver sales growth if management further expands its solutions and services. Remember that the company is well-positioned to serve many different sectors, which would help Exela collect revenue.
  • Note that management intends to implement robotic solutions on a per-user month basis. Robots can be an extremely profitable tool because they may be approximately the same for all clients.

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Exela (NASDAQ:XELA) announced a significant reduction in its debt and expects FCF to increase in 2022. With the target market increasing, if XELA designs and sells more robotic solutions, I expect a fair price of $6.05. Notice that I assumed

Disclosure: I/we have a beneficial long position in the shares of XELA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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