ExlService Holdings (EXLS) has just been added to several Russell value indices, including the Russell 1000 Value and 2500 Value. This shift directly affects how the stock appears in value focused portfolios.

Over the past year, ExlService Holdings has seen its share price and total shareholder return move very differently across timeframes. Recent 7 day share price gains of 2.15% and a 1 day share price return of 0.80% sit against a year to date share price decline of 33.03% and a 1 year total shareholder return decline of 38.86%. The 5 year total shareholder return of 26.95% shows a more favorable longer term picture as the market weighs the iMerit acquisition, upcoming Q2 2026 results and now the broader Russell value index inclusion.

If you are weighing ExlService Holdings against other opportunities in data heavy and AI exposed areas, it can be useful to see what else is in focus via the 63 profitable AI stocks that aren't just burning cash.

For ExlService Holdings, a near 40% one year total return decline sits alongside fresh Russell value index inclusion and a sizeable iMerit deal, so does it make more sense to commit at today’s price or hold out for a lower entry as the valuation stacks up next?

Most Popular Narrative: 33.9% Undervalued

ExlService Holdings closed at $27.60, while the most widely followed narrative anchors fair value at $41.75. This frames a sizeable valuation gap built on detailed earnings and cash flow assumptions.

The accelerated global adoption of AI and digital transformation in regulated industries is expanding the addressable market for ExlService, driving strong double-digit pipeline and growing annuity-like revenues; this trend supports sustained revenue growth and improved earnings visibility.

Curious what revenue run rate, margin profile and earnings multiple sit behind that $41.75 figure? The narrative connects steady growth, rising profitability and a re rated P/E. The full story shows exactly how those moving parts combine to support that fair value.

Result: Fair Value of $41.75 (UNDERVALUED)

However, ExlService Holdings still faces pressure from rising wage costs for skilled AI talent and tighter global data regulations. These factors could squeeze margins and slow client adoption.

Next Steps

The mix of recent share price weakness and that valuation gap around ExlService Holdings can look polarising, so it makes sense to move quickly and test the numbers against your own expectations, starting with the 4 key rewards.

Looking for more investment ideas beyond ExlService Holdings?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.