Goldman Sachs has looked into the issue and is convinced that it will be companies in particular that have extremely high personnel costs and, at the same time, great potential for automation.

The Goldman strategists use very specific figures. They take wage costs as a percentage of turnover and combine them with the proportion of jobs that can be automated using AI. The result is the so-called Phase 4 list of the AI revolution. AI hyperscalers, semiconductor values and data centers correspond to phase 1, phase 2 and phase 3 respectively.

Which sectors are phase 4 candidates? The answer is: software & services, professional services such as management consultancy, tax consultancy, insurance and IT services, because AI loves repetitive knowledge work.

The specific winners in the area of Banking & Finance include Bank of America $BAC (+0,48 %)KeyCorp $KEY (-0,09 %), PNC $PNC (+1 %), US Bancorp $TBBK and Truist $TFC (+0,35 %). Half of banking work is document processing - that's AI fodder.

For insurers Goldman Sachs calls Aon $AON (+0,5 %)Marsh & McLennan $MMC (+0,13 %), Willis Towers Watson $WTW (+0,22 %). When AI checks insurance claims, it is a cost revolution.

In the area of IT service providers & consultants the list includes Accenture $ACN (+1,21 %), Cognizant $CTSH (+0,32 %)EPAM $EPAM (-0,02 %)IBM $IBM (+0,12 %), Twilio $TWLO (-0,4 %), DXC $DXC (+0,93 %) and SAIC $SAIC (+0,02 %). These companies have consultants - and a large part of their activities can be automated with AI.

Among the software-specialists, Guidewire $GWRE (-0,87 %), Manhattan Associates $MANH (+0,38 %), Pegasystems $PEGA (+0,81 %) and Tyler Technologies $TYL (+1,05 %) are mentioned. These are companies that build software for the management of companies - and AI will allow them to deliver their products faster and more cheaply.

In the area of Healthcare Services & Life Science Tools Goldman names Labcorp $LH (+1,02 %)IQVIA $IQV (+0,94 %) and Certara $CERT (+0,64 %)because AI is already involved in medical documentation, study evaluation and diagnostics.

What makes Phase 4 shares so exciting? Every working hour saved has a direct impact on the margin. High productivity stands for high profit leverage. The advantage: unlike hyperscalers or chip companies, they don't need huge investments, but can simply use AI. This means less risk, more leverage and a lower valuation.

Conclusion:

Currently everything revolves around Nvidia $NVDA (-0,14 %) , AMD $AMD (-0,22 %), TSMC $2330 - i.e. phase 2 stocks. But the next wave is not coming for companies that use AI.

Source text (excerpt) & graphic: Welt, 03.12.25

$MANH (+0,38 %)

Manhattan Associates Financial Results (Q3 2025 Earnings Report):

📊 Core results

• Total revenue: approx. USD 238 millionan increase of around 20 % compared to the previous year.
• Cloud revenue: Double-digit growth, now the most important revenue driver.
• License and service revenue: Stable to slightly increasing, complementing the cloud segment.
• Earnings per share (non-GAAP EPS): approx. USD 0.81significantly above analysts' expectations.
• Operating margin: Improved as cloud business brings higher profitability.

🧭 Management comments

• Cloud-first strategy works: recurring revenue ensures stability.
• Demand for supply chain and omnichannel solutions remains high.
• Outlook for 2025: Forecast for revenue and profit confirmed or slightly raised.

📅 Outlook

• Q4 2025 figures are expected at the beginning of 2026.
• Focus on global expansion and expansion of the partner network.

📅 Conclusion

• Manhattan Associates continues to grow solidly, primarily through cloud subscriptions.
• EPS exceeded analysts' expectations (USD 1.36 vs. consensus USD 1.19).
• Profitability remains high despite slight decline in GAAP EPS.
• RPO growth of 23 % secures future sales.

$MANH (+0,38 %)

Manhattan Associates Inc. exceeds analysts' estimates of USD 1.03 with earnings per share of USD 1.19 in the first quarter. Sales of USD 262.8 million exceed expectations of USD 256.63 million.

1 **First quarter 2025 results:**

- Manhattan Associates generated total revenue of $262.8 million, an increase from $254.6 million in the first quarter of 2024.

- Cloud subscription revenue increased 21% to $94.3 million.

- GAAP diluted earnings per share were $0.85, while adjusted (non-GAAP) earnings per share were $1.19.

2 **Financial Highlights:**

- Adjusted operating income increased to $91.3 million (2024: $79.7 million).

- Operating cash flow reached $75.3 million, a significant increase from $54.7 million in the prior year

- The company invested $100 million in the buyback of treasury shares.

3 **Forecast for 2025:**

- Projected total revenues between $1,060 and $1,070 million (growth of 2%-3%).

- Expected GAAP EPS between $3.06 and $3.16.

*summarized with AI

Purchased due to the strong profitability ratios

ROE 75.64

ROCE 75.69

ROTC 80.14

I see no fundamental reason for the strong sell-off; -39% the last 3 months

Good morning everyone,

What is your assessment of $MANH (+0,38 %) ?

The share has been punished with -44% in the last 3 months.

In my opinion, the sell-off was completely exaggerated because the company delivers strong key figures.

• ROE 75.64
• ROCE 75.69
• ROTC 80.14
• FCF growth +18.57

I think I will buy the share soon, but I would be interested in any opinions that would speak against it.