DXC TECHNOLOGY CO (DXC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DXC - US23355L1061 - Common Stock
12.59 USD
+0.4 (+3.28%)
12.59 USD
0 (0%)
DXC gets a fundamental rating of 3 out of 10. The analysis compared the fundamentals against 85 industry peers in the IT Services industry. There are concerns on the financial health of DXC while its profitability can be described as average. DXC has a bad growth rate and is valued cheaply.
1. Profitability
1.1 Basic Checks
In the past year DXC was profitable.
DXC had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: DXC reported negative net income in multiple years.
Each year in the past 5 years DXC had a positive operating cash flow.
1.2 Ratios
The Return On Assets of DXC (2.75%) is comparable to the rest of the industry.
With a decent Return On Equity value of 12.15%, DXC is doing good in the industry, outperforming 71.76% of the companies in the same industry.
DXC has a Return On Invested Capital of 2.72%. This is comparable to the rest of the industry: DXC outperforms 51.76% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for DXC is significantly below the industry average of 29.78%.
The 3 year average ROIC (2.61%) for DXC is below the current ROIC(2.72%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.75% | ||
| ROE | 12.15% | ||
| ROIC | 2.72% |
ROA(3y)0.01%
ROA(5y)0.58%
ROE(3y)-0.32%
ROE(5y)2.05%
ROIC(3y)2.61%
ROIC(5y)N/A
1.3 Margins
DXC's Profit Margin of 2.93% is in line compared to the rest of the industry. DXC outperforms 54.12% of its industry peers.
DXC's Profit Margin has declined in the last couple of years.
DXC has a Operating Margin of 3.51%. This is comparable to the rest of the industry: DXC outperforms 48.24% of its industry peers.
DXC's Operating Margin has declined in the last couple of years.
DXC has a worse Gross Margin (24.59%) than 71.76% of its industry peers.
In the last couple of years the Gross Margin of DXC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 3.51% | ||
| PM (TTM) | 2.93% | ||
| GM | 24.59% |
OM growth 3Y8.71%
OM growth 5Y-14.76%
PM growth 3Y-11.86%
PM growth 5YN/A
GM growth 3Y3.04%
GM growth 5Y0.17%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), DXC is destroying value.
DXC has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, DXC has less shares outstanding
Compared to 1 year ago, DXC has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.88, we must say that DXC is in the distress zone and has some risk of bankruptcy.
DXC has a worse Altman-Z score (0.88) than 68.24% of its industry peers.
The Debt to FCF ratio of DXC is 4.26, which is a neutral value as it means it would take DXC, 4.26 years of fcf income to pay off all of its debts.
DXC's Debt to FCF ratio of 4.26 is in line compared to the rest of the industry. DXC outperforms 55.29% of its industry peers.
DXC has a Debt/Equity ratio of 1.25. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of DXC (1.25) is worse than 70.59% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.25 | ||
| Debt/FCF | 4.26 | ||
| Altman-Z | 0.88 |
ROIC/WACC0.37
WACC7.43%
2.3 Liquidity
A Current Ratio of 1.09 indicates that DXC should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.09, DXC is doing worse than 72.94% of the companies in the same industry.
DXC has a Quick Ratio of 1.09. This is a normal value and indicates that DXC is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of DXC (1.09) is worse than 71.76% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
DXC shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -6.55%.
Measured over the past years, DXC shows a decrease in Earnings Per Share. The EPS has been decreasing by -9.24% on average per year.
The Revenue has decreased by -4.13% in the past year.
The Revenue has been decreasing by -8.05% on average over the past years.
EPS 1Y (TTM)-6.55%
EPS 3Y-0.58%
EPS 5Y-9.24%
EPS Q2Q%-9.68%
Revenue 1Y (TTM)-4.13%
Revenue growth 3Y-7.5%
Revenue growth 5Y-8.05%
Sales Q2Q%-2.47%
3.2 Future
The Earnings Per Share is expected to grow by 1.81% on average over the next years.
Based on estimates for the next years, DXC will show a decrease in Revenue. The Revenue will decrease by -1.44% on average per year.
EPS Next Y-7.9%
EPS Next 2Y-3.78%
EPS Next 3Y1.81%
EPS Next 5YN/A
Revenue Next Year-1.13%
Revenue Next 2Y-1.85%
Revenue Next 3Y-1.44%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 3.84 indicates a rather cheap valuation of DXC.
Compared to the rest of the industry, the Price/Earnings ratio of DXC indicates a rather cheap valuation: DXC is cheaper than 95.29% of the companies listed in the same industry.
DXC is valuated cheaply when we compare the Price/Earnings ratio to 25.45, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 3.96, the valuation of DXC can be described as very cheap.
DXC's Price/Forward Earnings ratio is rather cheap when compared to the industry. DXC is cheaper than 96.47% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of DXC to the average of the S&P500 Index (34.46), we can say DXC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 3.84 | ||
| Fwd PE | 3.96 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, DXC is valued cheaper than 98.82% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of DXC indicates a rather cheap valuation: DXC is cheaper than 100.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 2.41 | ||
| EV/EBITDA | 1.65 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-3.78%
EPS Next 3Y1.81%
5. Dividend
5.1 Amount
No dividends for DXC!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
12.59
+0.4 (+3.28%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners93.03%
Inst Owner Change0.39%
Ins Owners1.17%
Ins Owner Change-1.48%
Market Cap2.25B
Revenue(TTM)12.71B
Net Income(TTM)373.00M
Analysts50
Price Target16.08 (27.72%)
Short Float %6.43%
Short Ratio5.74
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)13.99%
Min EPS beat(2)8.59%
Max EPS beat(2)19.38%
EPS beat(4)4
Avg EPS beat(4)13.44%
Min EPS beat(4)7.63%
Max EPS beat(4)19.38%
EPS beat(8)8
Avg EPS beat(8)17.01%
EPS beat(12)10
Avg EPS beat(12)10.51%
EPS beat(16)11
Avg EPS beat(16)6.35%
Revenue beat(2)1
Avg Revenue beat(2)0.01%
Min Revenue beat(2)-1.16%
Max Revenue beat(2)1.19%
Revenue beat(4)2
Avg Revenue beat(4)-0.39%
Min Revenue beat(4)-1.74%
Max Revenue beat(4)1.19%
Revenue beat(8)5
Avg Revenue beat(8)0.05%
Revenue beat(12)5
Avg Revenue beat(12)-0.62%
Revenue beat(16)5
Avg Revenue beat(16)-0.89%
PT rev (1m)-0.68%
PT rev (3m)-3.66%
EPS NQ rev (1m)-4.74%
EPS NQ rev (3m)-4.74%
EPS NY rev (1m)1.04%
EPS NY rev (3m)4.22%
Revenue NQ rev (1m)-0.56%
Revenue NQ rev (3m)-0.06%
Revenue NY rev (1m)-0.25%
Revenue NY rev (3m)2.24%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 3.84 | ||
| Fwd PE | 3.96 | ||
| P/S | 0.18 | ||
| P/FCF | 2.41 | ||
| P/OCF | 1.44 | ||
| P/B | 0.73 | ||
| P/tB | 3.34 | ||
| EV/EBITDA | 1.65 |
EPS(TTM)3.28
EY26.05%
EPS(NY)3.18
Fwd EY25.23%
FCF(TTM)5.22
FCFY41.44%
OCF(TTM)8.73
OCFY69.36%
SpS71.03
BVpS17.16
TBVpS3.77
PEG (NY)N/A
PEG (5Y)N/A
Graham Number35.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.75% | ||
| ROE | 12.15% | ||
| ROCE | 5.2% | ||
| ROIC | 2.72% | ||
| ROICexc | 3.35% | ||
| ROICexgc | 4.75% | ||
| OM | 3.51% | ||
| PM (TTM) | 2.93% | ||
| GM | 24.59% | ||
| FCFM | 7.35% |
ROA(3y)0.01%
ROA(5y)0.58%
ROE(3y)-0.32%
ROE(5y)2.05%
ROIC(3y)2.61%
ROIC(5y)N/A
ROICexc(3y)3.12%
ROICexc(5y)N/A
ROICexgc(3y)4.53%
ROICexgc(5y)N/A
ROCE(3y)4.4%
ROCE(5y)N/A
ROICexgc growth 3Y8.66%
ROICexgc growth 5Y-17.32%
ROICexc growth 3Y13.16%
ROICexc growth 5Y-10.47%
OM growth 3Y8.71%
OM growth 5Y-14.76%
PM growth 3Y-11.86%
PM growth 5YN/A
GM growth 3Y3.04%
GM growth 5Y0.17%
F-Score7
Asset Turnover0.94
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.25 | ||
| Debt/FCF | 4.26 | ||
| Debt/EBITDA | 2.25 | ||
| Cap/Depr | 50.08% | ||
| Cap/Sales | 4.95% | ||
| Interest Coverage | 2 | ||
| Cash Conversion | 91.83% | ||
| Profit Quality | 250.4% | ||
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z | 0.88 |
F-Score7
WACC7.43%
ROIC/WACC0.37
Cap/Depr(3y)46.69%
Cap/Depr(5y)44.53%
Cap/Sales(3y)4.88%
Cap/Sales(5y)4.74%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-6.55%
EPS 3Y-0.58%
EPS 5Y-9.24%
EPS Q2Q%-9.68%
EPS Next Y-7.9%
EPS Next 2Y-3.78%
EPS Next 3Y1.81%
EPS Next 5YN/A
Revenue 1Y (TTM)-4.13%
Revenue growth 3Y-7.5%
Revenue growth 5Y-8.05%
Sales Q2Q%-2.47%
Revenue Next Year-1.13%
Revenue Next 2Y-1.85%
Revenue Next 3Y-1.44%
Revenue Next 5YN/A
EBIT growth 1Y-13.06%
EBIT growth 3Y0.55%
EBIT growth 5Y-21.62%
EBIT Next Year80.51%
EBIT Next 3Y20.6%
EBIT Next 5YN/A
FCF growth 1Y24.87%
FCF growth 3Y-4.75%
FCF growth 5Y-14.28%
OCF growth 1Y10.46%
OCF growth 3Y-3.44%
OCF growth 5Y-9.87%
DXC TECHNOLOGY CO / DXC FAQ
What is the ChartMill fundamental rating of DXC TECHNOLOGY CO (DXC) stock?
ChartMill assigns a fundamental rating of 3 / 10 to DXC.
Can you provide the valuation status for DXC TECHNOLOGY CO?
ChartMill assigns a valuation rating of 7 / 10 to DXC TECHNOLOGY CO (DXC). This can be considered as Undervalued.
What is the profitability of DXC stock?
DXC TECHNOLOGY CO (DXC) has a profitability rating of 4 / 10.
What is the valuation of DXC TECHNOLOGY CO based on its PE and PB ratios?
The Price/Earnings (PE) ratio for DXC TECHNOLOGY CO (DXC) is 3.84 and the Price/Book (PB) ratio is 0.73.
How financially healthy is DXC TECHNOLOGY CO?
The financial health rating of DXC TECHNOLOGY CO (DXC) is 3 / 10.