AMDOCS LTD (DOX) Stock Fundamental Analysis
NASDAQ:DOX - Nasdaq - GB0022569080 - Common Stock - Currency: USD
DOX gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 82 industry peers in the IT Services industry. DOX scores excellent on profitability, but there are some minor concerns on its financial health. DOX may be a bit undervalued, certainly considering the very reasonable score on growth This makes DOX very considerable for value investing!
1. Profitability
1.1 Basic Checks
In the past year DOX was profitable.
In the past year DOX had a positive cash flow from operations.
Each year in the past 5 years DOX has been profitable.
DOX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 8.56%, DOX is in the better half of the industry, outperforming 79.52% of the companies in the same industry.
The Return On Equity of DOX (15.34%) is better than 74.70% of its industry peers.
DOX has a Return On Invested Capital of 13.74%. This is amongst the best in the industry. DOX outperforms 83.13% of its industry peers.
The Average Return On Invested Capital over the past 3 years for DOX is significantly below the industry average of 22.31%.
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
DOX has a better Profit Margin (11.17%) than 81.93% of its industry peers.
In the last couple of years the Profit Margin of DOX has declined.
Looking at the Operating Margin, with a value of 16.62%, DOX belongs to the top of the industry, outperforming 87.95% of the companies in the same industry.
DOX's Operating Margin has improved in the last couple of years.
DOX has a Gross Margin (36.55%) which is comparable to the rest of the industry.
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
DOX has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for DOX has been reduced compared to 1 year ago.
The number of shares outstanding for DOX has been reduced compared to 5 years ago.
Compared to 1 year ago, DOX has a worse debt to assets ratio.
2.2 Solvency
DOX has an Altman-Z score of 4.94. This indicates that DOX is financially healthy and has little risk of bankruptcy at the moment.
DOX's Altman-Z score of 4.94 is fine compared to the rest of the industry. DOX outperforms 72.29% 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.
With a decent Debt to FCF ratio value of 1.07, DOX is doing good in the industry, outperforming 79.52% of the companies in the same industry.
DOX has a Debt/Equity ratio of 0.19. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.19, DOX is doing good in the industry, outperforming 61.45% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 1.07 | ||
| Altman-Z | 4.94 |
ROIC/WACC1.46
WACC9.39%
2.3 Liquidity
DOX has a Current 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.
Looking at the Current ratio, with a value of 1.16, DOX is doing worse than 69.88% of the companies in the same industry.
A Quick Ratio of 1.16 indicates that DOX should not have too much problems paying its short term obligations.
DOX has a Quick ratio of 1.16. This is in the lower half of the industry: DOX underperforms 68.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.16 | ||
| Quick Ratio | 1.16 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 11.36% over the past year.
The Earnings Per Share has been growing by 8.36% on average over the past years. This is quite good.
Looking at the last year, DOX shows a small growth in Revenue. The Revenue has grown by 2.40% in the last year.
The Revenue has been growing slightly by 4.14% on average over the past years.
EPS 1Y (TTM)11.36%
EPS 3Y10.29%
EPS 5Y8.36%
EPS Q2Q%6.17%
Revenue 1Y (TTM)2.4%
Revenue growth 3Y5.28%
Revenue growth 5Y4.14%
Sales Q2Q%-8.45%
3.2 Future
Based on estimates for the next years, DOX will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.15% on average per year.
The Revenue is expected to grow by 1.11% on average over the next years.
EPS Next Y9.35%
EPS Next 2Y9.19%
EPS Next 3Y8.75%
EPS Next 5Y9.15%
Revenue Next Year-9.8%
Revenue Next 2Y-3.05%
Revenue Next 3Y0.54%
Revenue Next 5Y1.11%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
DOX is valuated correctly with a Price/Earnings ratio of 12.73.
DOX's Price/Earnings ratio is rather cheap when compared to the industry. DOX is cheaper than 80.72% of the companies in the same industry.
DOX's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.87.
With a Price/Forward Earnings ratio of 11.38, the valuation of DOX can be described as very reasonable.
81.93% of the companies in the same industry are more expensive than DOX, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 35.34, DOX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.73 | ||
| Fwd PE | 11.38 |
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 74.70% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, DOX is valued a bit cheaper than 73.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.14 | ||
| EV/EBITDA | 10.19 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of DOX may justify a higher PE ratio.
PEG (NY)1.36
PEG (5Y)1.52
EPS Next 2Y9.19%
EPS Next 3Y8.75%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.41%, DOX has a reasonable but not impressive dividend return.
DOX's Dividend Yield is rather good when compared to the industry average which is at 2.50. DOX pays more dividend than 92.77% of the companies in the same industry.
DOX's Dividend Yield is comparable with the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.41% |
5.2 History
On average, the dividend of DOX grows each year by 11.39%, which is quite nice.
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
DOX pays out 41.07% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of DOX is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP41.07%
EPS Next 2Y9.19%
EPS Next 3Y8.75%
87.36
+0.01 (+0.01%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners100.47%
Inst Owner Change-2.21%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap9.72B
Analysts85
Price Target105.33 (20.57%)
Short Float %3.53%
Short Ratio5.92
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.41% |
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)1.54%
PT rev (3m)1.62%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)0%
EPS NY rev (3m)0%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.09%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.13%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.73 | ||
| Fwd PE | 11.38 | ||
| P/S | 2.04 | ||
| P/FCF | 16.14 | ||
| P/OCF | 14.13 | ||
| P/B | 2.81 | ||
| P/tB | 23.99 | ||
| EV/EBITDA | 10.19 |
EPS(TTM)6.86
EY7.85%
EPS(NY)7.68
Fwd EY8.79%
FCF(TTM)5.41
FCFY6.2%
OCF(TTM)6.18
OCFY7.07%
SpS42.73
BVpS31.12
TBVpS3.64
PEG (NY)1.36
PEG (5Y)1.52
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 | 4.94 |
F-Score6
WACC9.39%
ROIC/WACC1.46
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)11.36%
EPS 3Y10.29%
EPS 5Y8.36%
EPS Q2Q%6.17%
EPS Next Y9.35%
EPS Next 2Y9.19%
EPS Next 3Y8.75%
EPS Next 5Y9.15%
Revenue 1Y (TTM)2.4%
Revenue growth 3Y5.28%
Revenue growth 5Y4.14%
Sales Q2Q%-8.45%
Revenue Next Year-9.8%
Revenue Next 2Y-3.05%
Revenue Next 3Y0.54%
Revenue Next 5Y1.11%
EBIT growth 1Y6.56%
EBIT growth 3Y8.26%
EBIT growth 5Y5.9%
EBIT Next Year23.49%
EBIT Next 3Y11.97%
EBIT Next 5Y8.69%
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%