Cautious Hold Rating for DXC Technology Amid Transition Challenges and Investment Needs

TD Cowen analyst Bryan Bergin maintained a Hold rating on DXC Technology (DXC – Research Report) yesterday and set a price target of $17.00.

Bryan Bergin’s rating is based on several key considerations. DXC Technology’s recent performance showed some improvement, with the company exceeding its fourth-quarter outlook and demonstrating healthy bookings growth. However, the initial guidance for the first quarter and fiscal year 2026 fell short of market expectations, reflecting ongoing macroeconomic challenges and organizational changes during its transition period.
Despite signs of progress, there is still significant work required to address the company’s fragmented structure and wide-ranging issues. Management has been actively restructuring, including adding new senior leaders, but this process takes time and affects business performance. Additionally, the need for investments in talent, go-to-market strategies, and IT infrastructure is impacting margins and financial forecasts, leading to a cautious outlook and a Hold rating from Bergin.