We recently published a list of 10 Mid-Cap IT Stocks Outperforming The Market In 2025. In this article, we are going to take a look at where ExlService Holdings Inc. (NASDAQ:EXLS) stands against other mid-cap IT stocks outperforming the market in 2025.
US Stocks continue their recovery from a post-DeepSeek and post-tariffs period as nerves surrounding Donald Trump’s unpredictable policies calm down. The Nasdaq is surging 1.19% followed by the S&P 500 at 0.64%. The bullishness is expected to continue for the remainder of the day.
To determine which stocks could outperform the market in the coming months, it is essential to look at sectors that are benefitting from ongoing trends. IT stocks are unique in a way that with time, all companies have to spend more to keep their systems updated. Analysts expect companies to add 5% to their IT budgets in 2025. This, together with the increasing demand for AI products, will propel the sector’s returns in 2025.
Some companies have already started the year on a positive note. There are companies that are seeing increasing demand for their innovative products while others continue to serve the infrastructure involved in deploying these innovative solutions. Either way, it is important to look at what’s driving these stocks.
We decided to take a look at the top 10 mid-cap IT stocks that are outperforming the market in 2025. To come up with our list, we only considered stocks with a market cap of at least $10 billion with the highest return since the start of the year.
A cross section of a data analyst overviewing code on several monitors.
ExlService Holdings Inc. (NASDAQ:EXLS)
ExlService Holdings Inc. provides data analysis and digital operations & solutions services. It operates through four segments; analytics, insurance, emerging business, and healthcare. The stock is up 15% so far this year.
EXLS doesn’t announce its Q4 earnings till the end of February so there is probably still a bit more juice in its ongoing rally. The last time the management did an earnings call, the company reported a decent earnings beat. The revenue of $472.07 million came in better than the estimates by $11.27 million. The EPS of $0.44 also beat estimates by $0.03. A 15% revenue growth and a 16% earnings growth was a satisfactory performance for the management.
The CEO of the company, Rohit Kapoor, is also quite optimistic about the company’s future prospects:
As we continue to expand our data modernization and AI solution set with innovations such as industry-specific large language models (LLMs), we are well positioned to continue our momentum into the fourth quarter and beyond
As a rather small player in AI, EXLS does stand the risk of government regulation or outright changes in the way AI develops in the coming months. Despite the company’s strengths, there are competitors out there that are doing the same thing and EXLS will have to differentiate itself to keep its moat. Investors will need to keep a close eye on how the technology and the company develop.
Overall, EXLS ranks 5th on our list of mid-cap IT stocks outperforming the market in 2025. While we acknowledge the potential of EXLS as a leading AI investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as EXLS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
