Alight (ALIT) Stock Forecast & Price Target

Alight is supported by a highly recurring revenue base of more than 90% from a blue-chip customer roster of roughly 5K clients and over 33M people on its platform, which gives the business durable cash generation and scale. Management’s emphasis on using virtually all free cash flow to reduce debt over the next 6-7 quarters should improve leverage ahead of the August 2028 Term Loan maturity, with net leverage expected to fall to 4.2x-4.4x by 2Q28. Although 2026 and 2027 are expected to reflect higher customer attrition and Y/Y declines, the technology-led transformation, low-40% free cash flow conversion in 2026, and a return to growth in 2028 underpin a constructive long-term view.

Alight is facing a deteriorating fundamental profile as higher customer attrition in 2025 is now expected to weigh through 2H26 and 1H27, driving management’s 2026 guidance for a 7%-8% decline in total revenue and a 26%-29% drop in adjusted EBITDA. Recurring revenue still declined 4% in 1Q26 and 2Q26, while 2Q26 adjusted EBITDA fell 28% Y/Y to $92M and margins compressed to 18.0% amid higher staffing and service investments, signaling limited near-term operating leverage. With $215M in cash versus $1,996M of debt and net leverage of 3.6x trailing EBITDA expected to peak at 5.2x-5.3x in 2Q27, the turnaround appears slower and riskier than previously expected.