DXC TECHNOLOGY CO (DXC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DXC - US23355L1061 - Common Stock
15.17 USD
-0.07 (-0.46%)
14.9731 USD
-0.2 (-1.3%)
Overall DXC gets a fundamental rating of 3 out of 10. We evaluated DXC against 85 industry peers in the IT Services industry. DXC has a medium profitability rating, but doesn't score so well on its financial health evaluation. DXC has a bad growth rate and is valued cheaply.
1. Profitability
1.1 Basic Checks
In the past year DXC was profitable.
In the past year DXC had a positive cash flow from operations.
In multiple years DXC reported negative net income over the last 5 years.
In the past 5 years DXC always reported a positive cash flow from operatings.
1.2 Ratios
With a Return On Assets value of 2.75%, DXC perfoms like the industry average, outperforming 55.29% of the companies in the same industry.
DXC has a Return On Equity of 12.15%. This is in the better half of the industry: DXC outperforms 71.76% of its industry peers.
DXC has a Return On Invested Capital of 2.72%. This is comparable to the rest of the industry: DXC outperforms 52.94% of its industry peers.
DXC had an Average Return On Invested Capital over the past 3 years of 2.61%. This is significantly below the industry average of 29.59%.
The last Return On Invested Capital (2.72%) for DXC is above the 3 year average (2.61%), which is a sign of increasing profitability.
| 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 has a Profit Margin (2.93%) which is comparable to the rest of the industry.
In the last couple of years the Profit Margin of DXC has declined.
DXC has a Operating Margin of 3.51%. This is comparable to the rest of the industry: DXC outperforms 49.41% of its industry peers.
DXC's Operating Margin has declined in the last couple of years.
DXC has a Gross Margin of 24.59%. This is in the lower half of the industry: DXC underperforms 71.76% of its industry peers.
DXC's Gross Margin has been stable in the last couple of years.
| 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
DXC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for DXC has been increased compared to 1 year ago.
The number of shares outstanding for DXC has been reduced compared to 5 years ago.
The debt/assets ratio for DXC has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.91, we must say that DXC is in the distress zone and has some risk of bankruptcy.
DXC has a worse Altman-Z score (0.91) than 70.59% 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.
Looking at the Debt to Equity ratio, with a value of 1.25, DXC is doing worse than 72.94% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.25 | ||
| Debt/FCF | 4.26 | ||
| Altman-Z | 0.91 |
ROIC/WACC0.36
WACC7.57%
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 74.12% 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.
With a Quick ratio value of 1.09, DXC is not doing good in the industry: 74.12% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
The earnings per share for DXC have decreased by -6.55% in the last year.
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.
DXC shows a decrease in Revenue. In the last year, the revenue decreased by -4.13%.
Measured over the past years, DXC shows a decrease in Revenue. The Revenue has been decreasing by -8.05% on average per year.
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
Based on estimates for the next years, DXC will show a decrease in Earnings Per Share. The EPS will decrease by -0.18% on average per year.
Based on estimates for the next years, DXC will show a decrease in Revenue. The Revenue will decrease by -1.46% on average per year.
EPS Next Y-7.9%
EPS Next 2Y-3.78%
EPS Next 3Y-0.18%
EPS Next 5YN/A
Revenue Next Year-1.18%
Revenue Next 2Y-1.87%
Revenue Next 3Y-1.46%
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 accelerating.
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
DXC is valuated cheaply with a Price/Earnings ratio of 4.63.
Compared to the rest of the industry, the Price/Earnings ratio of DXC indicates a rather cheap valuation: DXC is cheaper than 96.47% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of DXC to the average of the S&P500 Index (26.54), we can say DXC is valued rather cheaply.
With a Price/Forward Earnings ratio of 4.78, the valuation of DXC can be described as very cheap.
Based on the Price/Forward Earnings ratio, DXC is valued cheaply inside the industry as 97.65% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.78, DXC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.63 | ||
| Fwd PE | 4.78 |
4.2 Price Multiples
DXC's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. DXC is cheaper than 97.65% of the companies in the same industry.
98.82% of the companies in the same industry are more expensive than DXC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 2.83 | ||
| EV/EBITDA | 1.93 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-3.78%
EPS Next 3Y-0.18%
5. Dividend
5.1 Amount
DXC does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
15.17
-0.07 (-0.46%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners96.68%
Inst Owner Change0.41%
Ins Owners1.2%
Ins Owner Change0.75%
Market Cap2.64B
Revenue(TTM)12.71B
Net Income(TTM)373.00M
Analysts50
Price Target16.08 (6%)
Short Float %6.42%
Short Ratio5.56
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)-2.74%
PT rev (3m)-5.68%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-4.74%
EPS NY rev (1m)0%
EPS NY rev (3m)1.04%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.56%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)-0.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 4.63 | ||
| Fwd PE | 4.78 | ||
| P/S | 0.21 | ||
| P/FCF | 2.83 | ||
| P/OCF | 1.69 | ||
| P/B | 0.86 | ||
| P/tB | 3.91 | ||
| EV/EBITDA | 1.93 |
EPS(TTM)3.28
EY21.62%
EPS(NY)3.18
Fwd EY20.94%
FCF(TTM)5.36
FCFY35.36%
OCF(TTM)8.98
OCFY59.17%
SpS73.01
BVpS17.64
TBVpS3.88
PEG (NY)N/A
PEG (5Y)N/A
Graham Number36.08
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 | 0.91 |
F-Score7
WACC7.57%
ROIC/WACC0.36
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 3Y-0.18%
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-1.18%
Revenue Next 2Y-1.87%
Revenue Next 3Y-1.46%
Revenue Next 5YN/A
EBIT growth 1Y-13.06%
EBIT growth 3Y0.55%
EBIT growth 5Y-21.62%
EBIT Next Year80.41%
EBIT Next 3Y20.14%
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 4.63 and the Price/Book (PB) ratio is 0.86.
How financially healthy is DXC TECHNOLOGY CO?
The financial health rating of DXC TECHNOLOGY CO (DXC) is 3 / 10.