Financial Contrast: DXC Technology (DXC) and Its Peers

DXC Technology (NYSE: DXC) is one of 61 public companies in the “Data processing & preparation” industry, but how does it weigh in compared to its peers? We will compare DXC Technology to related companies based on the strength of its profitability, analyst recommendations, valuation, risk, earnings, dividends and institutional ownership.

Risk & Volatility

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DXC Technology has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500. Comparatively, DXC Technology’s peers have a beta of 0.57, indicating that their average share price is 43% less volatile than the S&P 500.

Earnings & Valuation

This table compares DXC Technology and its peers top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
DXC Technology $7.61 billion -$123.00 million 33.68
DXC Technology Competitors $928.00 million $44.64 million 17.24

DXC Technology has higher revenue, but lower earnings than its peers. DXC Technology is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Dividends

DXC Technology pays an annual dividend of $0.72 per share and has a dividend yield of 0.7%. DXC Technology pays out 23.2% of its earnings in the form of a dividend. As a group, “Data processing & preparation” companies pay a dividend yield of 1.2% and pay out 36.9% of their earnings in the form of a dividend.

Profitability

This table compares DXC Technology and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DXC Technology 5.18% 17.97% 6.78%
DXC Technology Competitors -18.25% -66.08% -6.06%

Institutional and Insider Ownership

84.9% of DXC Technology shares are held by institutional investors. Comparatively, 59.4% of shares of all “Data processing & preparation” companies are held by institutional investors. 1.3% of DXC Technology shares are held by insiders. Comparatively, 18.8% of shares of all “Data processing & preparation” companies are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and target prices for DXC Technology and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DXC Technology 0 4 11 2 2.88
DXC Technology Competitors 312 1500 2190 64 2.49

DXC Technology presently has a consensus price target of $104.94, suggesting a potential upside of 0.52%. As a group, “Data processing & preparation” companies have a potential upside of 3.01%. Given DXC Technology’s peers higher probable upside, analysts plainly believe DXC Technology has less favorable growth aspects than its peers.

Summary

DXC Technology beats its peers on 11 of the 15 factors compared.

About DXC Technology

DXC Technology Company, together with its subsidiaries, provides information technology services and solutions primarily in North America, Europe, Asia, and Australia. It operates through two segments, Global Business Services (GBS) and Global Infrastructure Services (GIS). The GBS segment offers technology solutions comprising consulting, applications services, and software. This segment also provides applications services, which optimize and modernize clients' business and technical environments that enable clients to capitalize on emerging services, such as cloud, mobility, and big data within new commercial models, including the ‘as a Service’ and digital economies; consulting services, which help organizations innovate, transform, and create sustainable competitive advantage; and vertically aligned software solutions and process-based intellectual property power mission-critical transaction engines in insurance, banking, healthcare and life sciences, manufacturing, and other diversified industries. The GIS segment offers managed and virtual desktop, unified communications and collaboration, data center management, cyber security, and compute and managed storage solutions to commercial clients. This segment also provides next-generation cloud offerings consisting of Infrastructure as a Service, private cloud solutions, CloudMail, and Storage as a Service. DXC Technology Company has a strategic partnership with HCL Technologies to create an applications modernization delivery network. The company was formerly known as Computer Sciences Corporation and changed its name to DXC Technology Company in April, 2017. DXC Technology Company was founded in 1959 and is headquartered in Tysons, Virginia.

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