My view on RWS Holdings (LON:RWS) was a good company but too expensive. Todays fall looks overdone to me and may provide a decent entry price for a company I would view as a medium/long term investment.
I am not particularly seeking opinions on value at the current price of 390p but what perhaps is a more fundamental question about the affect of AI on the need for translation services a few years out. Will Google Brain et al vastly diminish the market for RWS Holdings (LON:RWS) . I appreciate the company provides a very technical service but I envisage that Brain could do this with a bloke sat in the corner to undertake a final check!
Machine based translation has been around long enough to prove that what RWS does is not simple translation on a word for word basis. It requires an understanding of the industry or science behind the words as the precise meaning can be very important where patents are concerned. Given what is at stake, the clients that rely on RWS accuracy would need a lot of convincing to abandon what has served them very well so far. Sometimes cost is not the most important factor but if AI ever offers real potential here, I'm sure RWS would be exploiting it long before someone else ate their lunch.
It's also worth bearing in mind that pure translation is only part of RWS business these days.
