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 is valued quite cheap, while showing a decent growth score. This is a good combination! These ratings could make DOX a good candidate 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.
DOX had positive earnings in each of the past 5 years.
Each year in the past 5 years DOX had a positive operating cash flow.
1.2 Ratios
DOX's Return On Assets of 8.56% is fine compared to the rest of the industry. DOX outperforms 76.83% of its industry peers.
DOX has a Return On Equity of 15.34%. This is in the better half of the industry: DOX outperforms 74.39% of its industry peers.
DOX has a Return On Invested Capital of 13.74%. This is amongst the best in the industry. DOX outperforms 84.15% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DOX is significantly below the industry average of 21.64%.
The last Return On Invested Capital (13.74%) for DOX is above the 3 year average (12.04%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.56% | ||
| ROE | 15.34% | ||
| ROIC | 13.75% |
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
With a decent Profit Margin value of 11.17%, DOX is doing good in the industry, outperforming 79.27% of the companies in the same industry.
DOX's Profit Margin has declined in the last couple of years.
DOX's Operating Margin of 16.62% is amongst the best of the industry. DOX outperforms 86.59% of its industry peers.
DOX's Operating Margin has improved in the last couple of years.
DOX has a Gross Margin (36.55%) which is in line with its industry peers.
DOX's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.62% | ||
| PM (TTM) | 11.17% | ||
| GM | 36.55% |
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so DOX is still 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
DOX has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 4.99 indicates that DOX is not in any danger for bankruptcy at the moment.
DOX has a better Altman-Z score (4.99) than 71.95% of its industry peers.
DOX has a debt to FCF ratio of 1.07. This is a very positive value and a sign of high solvency as it would only need 1.07 years to pay back of all of its debts.
DOX has a Debt to FCF ratio of 1.07. This is amongst the best in the industry. DOX outperforms 81.71% of its industry peers.
A Debt/Equity ratio of 0.19 indicates that DOX is not too dependend on debt financing.
DOX's Debt to Equity ratio of 0.19 is fine compared to the rest of the industry. DOX outperforms 63.41% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 1.07 | ||
| Altman-Z | 4.99 |
ROIC/WACC1.44
WACC9.53%
2.3 Liquidity
A Current Ratio of 1.16 indicates that DOX should not have too much problems paying its short term obligations.
The Current ratio of DOX (1.16) is worse than 70.73% of its industry peers.
DOX has a Quick Ratio of 1.16. This is a normal value and indicates that DOX is financially healthy and should not expect problems in meeting its short term obligations.
DOX has a worse Quick ratio (1.16) than 69.51% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.16 | ||
| Quick Ratio | 1.16 |
3. Growth
3.1 Past
DOX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.64%, which is quite good.
The Earnings Per Share has been growing by 8.36% on average over the past years. This is quite good.
The Revenue has decreased by -4.37% in the past year.
Measured over the past years, DOX shows a small growth in Revenue. The Revenue has been growing by 4.14% on average per year.
EPS 1Y (TTM)10.64%
EPS 3Y10.29%
EPS 5Y8.36%
EPS Q2Q%14.1%
Revenue 1Y (TTM)-4.37%
Revenue growth 3Y5.28%
Revenue growth 5Y4.14%
Sales Q2Q%-9.44%
3.2 Future
The Earnings Per Share is expected to grow by 8.75% on average over the next years. This is quite good.
DOX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 0.58% yearly.
EPS Next Y9.35%
EPS Next 2Y9.19%
EPS Next 3Y8.75%
EPS Next 5YN/A
Revenue Next Year-9.84%
Revenue Next 2Y-3.04%
Revenue Next 3Y0.58%
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
Based on the Price/Earnings ratio of 13.06, the valuation of DOX can be described as correct.
DOX's Price/Earnings ratio is rather cheap when compared to the industry. DOX is cheaper than 84.15% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.30. DOX is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 11.49 indicates a reasonable valuation of DOX.
Based on the Price/Forward Earnings ratio, DOX is valued cheaper than 86.59% of the companies in the same industry.
DOX's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.06 | ||
| Fwd PE | 11.49 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DOX indicates a somewhat cheap valuation: DOX is cheaper than 76.83% of the companies listed 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 84.15% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.31 | ||
| EV/EBITDA | 10.4 |
4.3 Compensation for Growth
DOX's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
DOX has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.4
PEG (5Y)1.56
EPS Next 2Y9.19%
EPS Next 3Y8.75%
5. Dividend
5.1 Amount
DOX has a Yearly Dividend Yield of 2.28%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.48, DOX pays a better dividend. On top of this DOX pays more dividend than 93.90% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.37, DOX has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.28% |
5.2 History
The dividend of DOX is nicely growing with an annual growth rate of 11.39%!
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
41.07% of the earnings are spent on dividend by DOX. This is a bit on the high side, but may be sustainable.
DOX's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP41.07%
EPS Next 2Y9.19%
EPS Next 3Y8.75%
88.26
-0.98 (-1.1%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners100.53%
Inst Owner Change0%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap9.82B
Analysts83.64
Price Target103.73 (17.53%)
Short Float %3.02%
Short Ratio5.16
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.28% |
Yearly Dividend1.84
Dividend Growth(5Y)11.39%
DP41.07%
Div Incr Years12
Div Non Decr Years12
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.88%
Min EPS beat(2)0.39%
Max EPS beat(2)3.37%
EPS beat(4)2
Avg EPS beat(4)0.7%
Min EPS beat(4)-0.91%
Max EPS beat(4)3.37%
EPS beat(8)3
Avg EPS beat(8)0.61%
EPS beat(12)4
Avg EPS beat(12)0.91%
EPS beat(16)7
Avg EPS beat(16)2.77%
Revenue beat(2)0
Avg Revenue beat(2)-1.01%
Min Revenue beat(2)-1.42%
Max Revenue beat(2)-0.6%
Revenue beat(4)0
Avg Revenue beat(4)-1.06%
Min Revenue beat(4)-1.42%
Max Revenue beat(4)-0.6%
Revenue beat(8)0
Avg Revenue beat(8)-0.96%
Revenue beat(12)1
Avg Revenue beat(12)-0.85%
Revenue beat(16)2
Avg Revenue beat(16)5.3%
PT rev (1m)0.08%
PT rev (3m)-1.19%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.39%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.04%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.26%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.06 | ||
| Fwd PE | 11.49 | ||
| P/S | 2.07 | ||
| P/FCF | 16.31 | ||
| P/OCF | 14.28 | ||
| P/B | 2.84 | ||
| P/tB | 24.24 | ||
| EV/EBITDA | 10.4 |
EPS(TTM)6.76
EY7.66%
EPS(NY)7.68
Fwd EY8.7%
FCF(TTM)5.41
FCFY6.13%
OCF(TTM)6.18
OCFY7%
SpS42.73
BVpS31.12
TBVpS3.64
PEG (NY)1.4
PEG (5Y)1.56
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.56% | ||
| ROE | 15.34% | ||
| ROCE | 16.24% | ||
| ROIC | 13.75% | ||
| ROICexc | 14.73% | ||
| ROICexgc | 45.04% | ||
| OM | 16.62% | ||
| PM (TTM) | 11.17% | ||
| GM | 36.55% | ||
| FCFM | 12.67% |
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-Score6
Asset Turnover0.77
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 1.07 | ||
| Debt/EBITDA | 0.66 | ||
| Cap/Depr | 45.45% | ||
| Cap/Sales | 1.8% | ||
| Interest Coverage | 20.25 | ||
| Cash Conversion | 70.3% | ||
| Profit Quality | 113.39% | ||
| Current Ratio | 1.16 | ||
| Quick Ratio | 1.16 | ||
| Altman-Z | 4.99 |
F-Score6
WACC9.53%
ROIC/WACC1.44
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)10.64%
EPS 3Y10.29%
EPS 5Y8.36%
EPS Q2Q%14.1%
EPS Next Y9.35%
EPS Next 2Y9.19%
EPS Next 3Y8.75%
EPS Next 5YN/A
Revenue 1Y (TTM)-4.37%
Revenue growth 3Y5.28%
Revenue growth 5Y4.14%
Sales Q2Q%-9.44%
Revenue Next Year-9.84%
Revenue Next 2Y-3.04%
Revenue Next 3Y0.58%
Revenue Next 5YN/A
EBIT growth 1Y6.56%
EBIT growth 3Y8.26%
EBIT growth 5Y5.9%
EBIT Next Year22.95%
EBIT Next 3Y12.03%
EBIT Next 5YN/A
FCF growth 1Y5.62%
FCF growth 3Y-4.71%
FCF growth 5Y3.22%
OCF growth 1Y-9.72%
OCF growth 3Y-7.85%
OCF growth 5Y1.99%