DXC Technology (DXC) Stock Sinks As Market Gains: What You Should Know
DXC Technology (DXC) closed at $53.11 in the latest trading session, marking a -0.34% move from the prior day. This change lagged the S&P 500's 0.3% gain on the day. At the same time, the Dow added 0.15%, and the tech-heavy Nasdaq gained 0.42%.
Heading into today, shares of the information technology company had lost 3.53% over the past month, lagging the Computer and Technology sector's gain of 0.55% and the S&P 500's gain of 2.2% in that time.
DXC will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1.73, down 10.36% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $4.92 billion, down 6.84% from the year-ago period.
DXC's full-year Zacks Consensus Estimates are calling for earnings of $8.18 per share and revenue of $20.83 billion. These results would represent year-over-year changes of -1.92% and +0.39%, respectively.
Any recent changes to analyst estimates for DXC should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 11.38% lower within the past month. DXC is currently a Zacks Rank #5 (Strong Sell).
In terms of valuation, DXC is currently trading at a Forward P/E ratio of 6.52. This represents a discount compared to its industry's average Forward P/E of 18.84.
Investors should also note that DXC has a PEG ratio of 1.66 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computers - IT Services was holding an average PEG ratio of 1.69 at yesterday's closing price.
The Computers - IT Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 152, putting it in the bottom 41% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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