AMDOCS LTD (DOX) Stock Fundamental Analysis
NASDAQ:DOX - Nasdaq - GB0022569080 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to DOX. DOX was compared to 82 industry peers in the IT Services industry. While DOX has a great profitability rating, there are some minor concerns on its financial health. DOX may be a bit undervalued, certainly considering the very reasonable score on growth This makes DOX very considerable for value investing!
1. Profitability
1.1 Basic Checks
DOX had positive earnings in the past year.
DOX had a positive operating cash flow in the past year.
Each year in the past 5 years DOX has been profitable.
Each year in the past 5 years DOX had a positive operating cash flow.
1.2 Ratios
DOX's Return On Assets of 7.58% is fine compared to the rest of the industry. DOX outperforms 76.92% of its industry peers.
The Return On Equity of DOX (14.00%) is better than 73.08% of its industry peers.
DOX has a better Return On Invested Capital (13.08%) than 83.33% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DOX is in line with the industry average of 10.13%.
The last Return On Invested Capital (13.08%) for DOX is above the 3 year average (12.04%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.58% | ||
| ROE | 14% | ||
| ROIC | 13.08% |
ROA(3y)8.11%
ROA(5y)8.52%
ROE(3y)14.83%
ROE(5y)15.42%
ROIC(3y)12.04%
ROIC(5y)11.1%
1.3 Margins
DOX has a Profit Margin of 9.67%. This is in the better half of the industry: DOX outperforms 73.08% of its industry peers.
DOX's Profit Margin has declined in the last couple of years.
DOX's Operating Margin of 15.18% is amongst the best of the industry. DOX outperforms 83.33% of its industry peers.
In the last couple of years the Operating Margin of DOX has grown nicely.
With a Gross Margin value of 35.07%, DOX perfoms like the industry average, outperforming 51.28% of the companies in the same industry.
In the last couple of years the Gross Margin of DOX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.18% | ||
| PM (TTM) | 9.67% | ||
| GM | 35.07% |
OM growth 3Y2.83%
OM growth 5Y1.69%
PM growth 3Y-15.26%
PM growth 5Y-3.67%
GM growth 3Y0.59%
GM growth 5Y-0.01%
2. Health
2.1 Basic Checks
DOX has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for DOX has been reduced compared to 1 year ago.
Compared to 5 years ago, DOX has less shares outstanding
The debt/assets ratio for DOX is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.79 indicates that DOX is not in any danger for bankruptcy at the moment.
With a decent Altman-Z score value of 4.79, DOX is doing good in the industry, outperforming 74.36% of the companies in the same industry.
The Debt to FCF ratio of DOX is 1.04, which is an excellent value as it means it would take DOX, only 1.04 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 1.04, DOX belongs to the best of the industry, outperforming 80.77% of the companies in the same industry.
DOX has a Debt/Equity ratio of 0.19. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.19, DOX is in the better half of the industry, outperforming 65.38% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 1.04 | ||
| Altman-Z | 4.79 |
ROIC/WACC1.24
WACC10.57%
2.3 Liquidity
DOX has a Current Ratio of 1.20. This is a normal value and indicates that DOX is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.20, DOX is doing worse than 69.23% of the companies in the same industry.
A Quick Ratio of 1.20 indicates that DOX should not have too much problems paying its short term obligations.
The Quick ratio of DOX (1.20) is worse than 67.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.2 | ||
| Quick Ratio | 1.2 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 8.64% over the past year.
The Earnings Per Share has been growing by 8.36% on average over the past years. This is quite good.
The Revenue has been growing slightly by 2.40% in the past year.
The Revenue has been growing slightly by 4.14% on average over the past years.
EPS 1Y (TTM)8.64%
EPS 3Y10.29%
EPS 5Y8.36%
EPS Q2Q%6.41%
Revenue 1Y (TTM)2.4%
Revenue growth 3Y5.28%
Revenue growth 5Y4.14%
Sales Q2Q%-10.85%
3.2 Future
Based on estimates for the next years, DOX will show a small growth in Earnings Per Share. The EPS will grow by 7.99% on average per year.
DOX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.06% yearly.
EPS Next Y9.94%
EPS Next 2Y9.54%
EPS Next 3Y7.99%
EPS Next 5YN/A
Revenue Next Year-9.56%
Revenue Next 2Y-2.69%
Revenue Next 3Y2.06%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 13.46, DOX is valued correctly.
DOX's Price/Earnings ratio is rather cheap when compared to the industry. DOX is cheaper than 87.18% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.63, DOX is valued rather cheaply.
A Price/Forward Earnings ratio of 11.39 indicates a reasonable valuation of DOX.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DOX indicates a rather cheap valuation: DOX is cheaper than 89.74% of the companies listed in the same industry.
DOX is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.68, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.46 | ||
| Fwd PE | 11.39 |
4.2 Price Multiples
DOX's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. DOX is cheaper than 80.77% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of DOX indicates a rather cheap valuation: DOX is cheaper than 87.18% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.04 | ||
| EV/EBITDA | 10.54 |
4.3 Compensation for Growth
DOX's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of DOX may justify a higher PE ratio.
PEG (NY)1.35
PEG (5Y)1.61
EPS Next 2Y9.54%
EPS Next 3Y7.99%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.42%, DOX has a reasonable but not impressive dividend return.
DOX's Dividend Yield is rather good when compared to the industry average which is at 2.96. DOX pays more dividend than 93.59% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.29, DOX has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.42% |
5.2 History
On average, the dividend of DOX grows each year by 11.39%, which is quite nice.
DOX has been paying a dividend for at least 10 years, so it has a reliable track record.
DOX has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)11.39%
Div Incr Years12
Div Non Decr Years12
5.3 Sustainability
DOX pays out 43.81% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of DOX is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP43.81%
EPS Next 2Y9.54%
EPS Next 3Y7.99%
88
-1.31 (-1.47%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners97.87%
Inst Owner Change-0.38%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap9.93B
Analysts85
Price Target104.16 (18.36%)
Short Float %3.5%
Short Ratio5.89
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.42% |
Yearly Dividend1.84
Dividend Growth(5Y)11.39%
DP43.81%
Div Incr Years12
Div Non Decr Years12
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-0.47%
Min EPS beat(2)-0.91%
Max EPS beat(2)-0.03%
EPS beat(4)0
Avg EPS beat(4)-0.79%
Min EPS beat(4)-1.22%
Max EPS beat(4)-0.03%
EPS beat(8)2
Avg EPS beat(8)1.11%
EPS beat(12)4
Avg EPS beat(12)2.47%
EPS beat(16)6
Avg EPS beat(16)2.53%
Revenue beat(2)0
Avg Revenue beat(2)-1.1%
Min Revenue beat(2)-1.34%
Max Revenue beat(2)-0.87%
Revenue beat(4)0
Avg Revenue beat(4)-0.97%
Min Revenue beat(4)-1.34%
Max Revenue beat(4)-0.7%
Revenue beat(8)1
Avg Revenue beat(8)-0.79%
Revenue beat(12)2
Avg Revenue beat(12)7.4%
Revenue beat(16)3
Avg Revenue beat(16)5.44%
PT rev (1m)0%
PT rev (3m)3.06%
EPS NQ rev (1m)0.05%
EPS NQ rev (3m)-4.26%
EPS NY rev (1m)0.55%
EPS NY rev (3m)-0.33%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-14.44%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)-12.72%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.46 | ||
| Fwd PE | 11.39 | ||
| P/S | 1.98 | ||
| P/FCF | 16.04 | ||
| P/OCF | 13.7 | ||
| P/B | 2.87 | ||
| P/tB | 22 | ||
| EV/EBITDA | 10.54 |
EPS(TTM)6.54
EY7.43%
EPS(NY)7.73
Fwd EY8.78%
FCF(TTM)5.49
FCFY6.23%
OCF(TTM)6.42
OCFY7.3%
SpS44.36
BVpS30.64
TBVpS4
PEG (NY)1.35
PEG (5Y)1.61
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.58% | ||
| ROE | 14% | ||
| ROCE | 15.46% | ||
| ROIC | 13.08% | ||
| ROICexc | 14.61% | ||
| ROICexgc | 46.09% | ||
| OM | 15.18% | ||
| PM (TTM) | 9.67% | ||
| GM | 35.07% | ||
| FCFM | 12.37% |
ROA(3y)8.11%
ROA(5y)8.52%
ROE(3y)14.83%
ROE(5y)15.42%
ROIC(3y)12.04%
ROIC(5y)11.1%
ROICexc(3y)13.94%
ROICexc(5y)13.13%
ROICexgc(3y)42.67%
ROICexgc(5y)40.42%
ROCE(3y)14.23%
ROCE(5y)13.16%
ROICexcg growth 3Y7.36%
ROICexcg growth 5Y-2.03%
ROICexc growth 3Y6.95%
ROICexc growth 5Y1.8%
OM growth 3Y2.83%
OM growth 5Y1.69%
PM growth 3Y-15.26%
PM growth 5Y-3.67%
GM growth 3Y0.59%
GM growth 5Y-0.01%
F-Score4
Asset Turnover0.78
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 1.04 | ||
| Debt/EBITDA | 0.68 | ||
| Cap/Depr | 54.64% | ||
| Cap/Sales | 2.11% | ||
| Interest Coverage | 21.46 | ||
| Cash Conversion | 76.03% | ||
| Profit Quality | 127.92% | ||
| Current Ratio | 1.2 | ||
| Quick Ratio | 1.2 | ||
| Altman-Z | 4.79 |
F-Score4
WACC10.57%
ROIC/WACC1.24
Cap/Depr(3y)73.13%
Cap/Depr(5y)84.75%
Cap/Sales(3y)3.21%
Cap/Sales(5y)3.89%
Profit Quality(3y)119.02%
Profit Quality(5y)110.73%
High Growth Momentum
Growth
EPS 1Y (TTM)8.64%
EPS 3Y10.29%
EPS 5Y8.36%
EPS Q2Q%6.41%
EPS Next Y9.94%
EPS Next 2Y9.54%
EPS Next 3Y7.99%
EPS Next 5YN/A
Revenue 1Y (TTM)2.4%
Revenue growth 3Y5.28%
Revenue growth 5Y4.14%
Sales Q2Q%-10.85%
Revenue Next Year-9.56%
Revenue Next 2Y-2.69%
Revenue Next 3Y2.06%
Revenue Next 5YN/A
EBIT growth 1Y-15.54%
EBIT growth 3Y8.26%
EBIT growth 5Y5.9%
EBIT Next Year24.46%
EBIT Next 3Y12.11%
EBIT Next 5YN/A
FCF growth 1Y-11.36%
FCF growth 3Y-4.71%
FCF growth 5Y3.22%
OCF growth 1Y-11.94%
OCF growth 3Y-7.85%
OCF growth 5Y1.99%