8. Alight, Inc. (NYSE:ALIT)
Greenlight Capital’s Equity Stake: $81.73 Million
Number of Hedge Fund Holders: 42
Alight, Inc. (NYSE:ALIT) is a technology company that provides cloud-based integrated digital human capital and business solutions worldwide. Its emphasis on offering cutting-edge technological solutions for human capital management (HCM) is a major contributor to its success.
Alight, Inc. (NYSE:ALIT) has distinguished itself in the market by utilizing artificial intelligence and machine learning to make HR and financial tasks easier. Through AI, Alight examines extensive data sets, enabling companies to predict patterns and spot possible problems before they grow bigger, therefore making it a solid AI investment play.
The company has been investing in improving its cloud-based services, which include workforce management, payroll, and benefits administration. By drawing in new customers and keeping hold of current ones, it has positioned itself as a market leader in the quickly changing HR technology sector. Additionally, it is in a strong position to profit from the expanding trend of companies trying to enhance employee experiences and streamline HR operations.
Alight, Inc. (NYSE:ALIT) delivered mixed second-quarter results, with revenues dropping 4.1% to $538 million, down from $561 million the year before. This drop was caused by reduced sales, lower net business activity, a decrease in project income in our Employer Solutions division, and the winding down of our Hosted business activities.
Nevertheless, the company is inching closer to profitability, its net loss having shrunk to $0.01 in the quarter from $0.14 a share delivered the same quarter last year. The company also returns value to shareholders, having bought $80 million worth of stock in the quarter.
Alight, Inc. (NYSE:ALIT)’s sales of its payroll and professional services division have improved its financial position on its gross margins by 350 basis points to more than 40% and elevating adjusted EBITDA margins from 21.7% to 25%. Additionally, the company finished its two-year transition to cloud technology, which is anticipated to yield $75 million in yearly cost savings from operations, aiding in the growth of margins.
The stock remains attractively priced while trading at a price-to-earnings multiple of 11. Insider Monkey’s Q2 2024 data revealed that the company was held by 42 hedge funds.
Meridian Growth Fund stated the following regarding Alight, Inc. (NYSE:ALIT) in its Q2 2024 investor letter:
“Alight, Inc. (NYSE:ALIT) is a leading cloud-based human capital technology provider of enterprise-level software that helps businesses and their employees manage critical human resources functions. Through its investments in software and automation, Alight has built a distinct advantage that allows its customers to deliver HR services at a much lower cost while providing a better experience for employees.
We slightly trimmed the position early in the quarter when the stock appreciated on the announced sale of a non-strategic business unit and news that an activist investor had initiated a position. Later in the period, the stock declined when Alight announced weaker-than-expected results. We believe the softer quarter will prove to be an isolated event.”
