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DXC Technology
(NYSE:DXC)
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Rating:54Neutral
Price Target:
$11.50
▲(14.43% Upside)
Action:Reiterated
Date:07/31/26
DXC scores in the mid-range primarily because strong and growing free cash flow and an improving balance sheet are counterbalanced by ongoing revenue declines and very thin profitability. Technicals are modestly supportive in the short term (above key shorter moving averages) but still weak versus the 200-day trend. A very high P/E further pressures the score, and the latest guidance reinforced near-term top-line contraction and some reliance on one-time litigation-related cash.
Positive Factors
Free Cash Flow Generation
DXC’s consistently strong operating and free cash flow provides durable internal funding. Large FCF supports continued deleveraging, strategic investments in AI and SaaS, selective buybacks and gives the company flexibility to absorb cyclical revenue dips without immediate external financing.
Negative Factors
Persistent Revenue Declines
Sustained top-line contraction undermines operating leverage and makes margin recovery harder over time. Even with bookings improvement, conversion to stable revenue lags, limiting cash generation consistency and increasing execution pressure to translate pipeline into durable growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Free Cash Flow Generation
DXC’s consistently strong operating and free cash flow provides durable internal funding. Large FCF supports continued deleveraging, strategic investments in AI and SaaS, selective buybacks and gives the company flexibility to absorb cyclical revenue dips without immediate external financing.
Read all positive factors
DXC Technology Key Performance Indicators (KPIs)
Any
Revenue by Geography
Shows how DXC’s sales are distributed across regions, highlighting dependence on key markets, exposure to local economic or currency swings, and where international growth or contraction will most affect overall performance.
Shows how DXC’s sales are distributed across regions, highlighting dependence on key markets, exposure to local economic or currency swings, and where international growth or contraction will most affect overall performance.
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The Fly
The FlyDXC Technology (DXC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.82B
Dividend YieldN/A
Average Volume (3M)5.06M
Price to Earnings (P/E)14.8
Beta (1Y)0.99
Revenue Growth-2.42%
EPS Growth-65.01%
CountryUS
Employees115,000
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)0.76
Shares Outstanding162,080,260
10 Day Avg. Volume3,084,441
30 Day Avg. Volume5,060,056
Financial Highlights & Ratios
PEG Ratio-1.32
Price to Book (P/B)0.75
Price to Sales (P/S)0.17
P/FCF Ratio2.12
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$11.21Price Target Upside11.58% Upside
Rating ConsensusHold
Number of Analyst Covering8
EPS Forecast (FY)2.56
Revenue Forecast (FY)$12.15B
DXC Technology Business Overview & Revenue Model
Company Description
DXC Technology (DXC) is a global IT services company that helps enterprises and public-sector organizations run and modernize mission-critical systems and operations. The company provides services across consulting/engineering, cloud and infrastru...
How the Company Makes Money
DXC primarily makes money by delivering contracted IT services to customers under recurring and project-based commercial arrangements. Key revenue streams include: (1) Managed services/outsourcing: DXC operates and supports customers’ IT environme...
DXC Technology Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q1-2027)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Neutral
The call balanced encouraging strategic and operational progress in AI products, partnerships, and bookings (notably GIS bookings, SaaS growth, product performance, and improved liquidity) against persistent top-line pressure, margin compression in the quarter, and conservative near-term revenue guidance. Management emphasized early, measurable AI use cases, faster sales cycles, and a disciplined capital posture, but several financial headwinds (organic revenue declines, dependency on litigation-related cash for FCF uplift, and soft discretionary spend) temper short-term outlook.Positive Updates
Strategic AI Partnerships and Talent Initiatives
Announced global partnership with Anthropic; launched forward deployed engineer (FDE) model and certified first 86 engineers with goal to scale to tens of thousands; multilingual FDE certification combining Anthropic, Amazon QuickSight, Microsoft Copilot, 7AI and 11 Labs.
Negative Updates
Overall Revenue Decline
Total Q1 revenue was $3.0 billion, down 6.7% year-over-year (organic, non-GAAP), reflecting continued customer caution and softness in discretionary IT infrastructure projects.
Read all updates
Q1-2027 Updates
Positive
Negative
Strategic AI Partnerships and Talent Initiatives
Announced global partnership with Anthropic; launched forward deployed engineer (FDE) model and certified first 86 engineers with goal to scale to tens of thousands; multilingual FDE certification combining Anthropic, Amazon QuickSight, Microsoft Copilot, 7AI and 11 Labs.
Read all positive updates
Company Guidance
Management updated fiscal 2027 guidance expecting total organic revenue to decline 3%–5% year‑over‑year (Q2 guide: down 5.5%–6.5% y/y with sequential improvement into the back half toward roughly -2%), full‑year adjusted EBIT margin of 6%–7% (Q2 ~6.0%), non‑GAAP diluted EPS of $2.40–$2.90 (Q2 ~$0.55), and full‑year free cash flow of about $685 million (which includes a $214 million TCS litigation cash benefit and an underlying ~ $600 million FCF expectation). Segment pacing: CES is expected to decline low single digits, GIS mid single digits (management said ~90% of the H2 improvement is driven by GIS and roughly 75% of that improvement is from opening backlog dynamics), and Insurance low single‑digit growth aided by SaaS momentum (insurance software +13% y/y, SaaS revenues more than doubled y/y). For context, Q1 results included $3.0 billion revenue (‑6.7% y/y), total bookings +5% y/y with book‑to‑bill 0.99x (T‑12 slightly >1.0x), CES book‑to‑bill 0.98x (T‑12 1.04x), GIS book‑to‑bill 1.11x (bookings +35% y/y), adjusted EBIT margin 5.0% (down 180 bps y/y), non‑GAAP EPS $0.40, Q1 free cash flow $314M (ex‑litigation $100M), cash ≈ $1.9B (+$200M), net debt ≈ $1.5B (down ≈$270M), $70M of share repurchases in the quarter and plans to repurchase ≈$50M this year plus retire $400M of bonds maturing Sept 2026.DXC Technology Financial Statement Overview
Summary
Income Statement
38
Negative
Balance Sheet
52
Neutral
Cash Flow
74
Positive
| Breakdown | TTM | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 12.48B | 12.64B | 12.87B | 13.67B | 14.43B | 16.27B |
| Gross Profit | 1.71B | 1.87B | 3.10B | 3.09B | 3.18B | 3.58B |
| EBITDA | 1.55B | 1.69B | 2.21B | 1.84B | 866.00M | 3.09B |
| Net Income | 124.00M | 18.00M | 389.00M | 91.00M | -568.00M | 718.00M |
Balance Sheet | ||||||
| Total Assets | 12.93B | 12.89B | 13.21B | 13.87B | 15.85B | 20.14B |
| Cash, Cash Equivalents and Short-Term Investments | 1.96B | 1.74B | 1.80B | 1.22B | 1.86B | 2.67B |
| Total Debt | 4.17B | 4.25B | 4.55B | 4.87B | 5.37B | 6.17B |
| Total Liabilities | 9.60B | 9.68B | 9.71B | 10.80B | 12.03B | 14.76B |
| Stockholders Equity | 3.06B | 2.94B | 3.23B | 2.81B | 3.50B | 5.05B |
Cash Flow | ||||||
| Free Cash Flow | 1.25B | 1.04B | 822.00M | 954.00M | 1.15B | 1.25B |
| Operating Cash Flow | 1.48B | 1.25B | 1.40B | 1.36B | 1.42B | 1.50B |
| Investing Cash Flow | -506.00M | -484.00M | -512.00M | -491.00M | -635.00M | -60.00M |
| Financing Cash Flow | -786.00M | -776.00M | -317.00M | -1.49B | -1.51B | -1.82B |
DXC Technology Technical Analysis
Positive
10.05
Price Trends
9.43
Positive
10.52
Positive
12.19
Negative
Market Momentum
0.48
Negative
65.82
Neutral
83.93
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DXC, the sentiment is Positive. The current price of 10.05 is above the 20-day moving average (MA) of 9.91, above the 50-day MA of 9.43, and below the 200-day MA of 12.19, indicating a neutral trend. The MACD of 0.48 indicates Negative momentum. The RSI at 65.82 is Neutral, neither overbought nor oversold. The STOCH value of 83.93 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DXC.
DXC Technology Risk Analysis
DXC Technology disclosed 29 risk factors in its most recent earnings report. DXC Technology reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
DXC Technology Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $24.93B | 11.88 | 14.94% | 2.82% | 5.64% | -5.39% | |
75 Outperform | $48.17B | 14.45 | 33.03% | 4.71% | -0.64% | 5.69% | |
71 Outperform | $5.96B | 10.66 | 22.44% | 2.29% | 6.47% | 10.82% | |
69 Neutral | $5.51B | 15.08 | 10.67% | ― | 14.21% | -2.92% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
56 Neutral | $2.99B | 15.84 | 16.40% | ― | 0.23% | -20.13% | |
54 Neutral | $1.82B | 14.79 | 3.97% | ― | -2.42% | -65.01% |
* Technology Sector Average
DXC
DXC Technology
11.24
-2.10
-15.74%
CTSH
Cognizant
55.35
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EPAM
Epam Systems
105.56
-47.74
-31.14%
G
Genpact
35.17
-6.61
-15.81%
INFY
Infosys
12.03
-3.95
-24.71%
KD
Kyndryl Holdings Incorporation
13.55
-23.15
-63.08%
DXC Technology Corporate Events
Business Operations and StrategyExecutive/Board Changes
DXC Technology Realigns Leadership to Drive AI Strategy
Positive
Jul 30, 2026
On July 25, 2026, DXC Technology received the resignation of Chris Drumgoole as President of Global Infrastructure Services, effective July 30, 2026, with no related separation arrangements and no disagreement cited over company operations or poli...
Executive/Board ChangesShareholder Meetings
DXC Technology Shareholders Decide Governance and Compensation Matters
Neutral
Jul 22, 2026
DXC Technology held its 2026 Annual Meeting of Stockholders on July 21, 2026, where shareholders elected all nine director nominees to serve until the 2027 meeting. Stockholders also ratified Deloitte Touche LLP as the independent registered publ...
Business Operations and Strategy
DXC Technology Hosts Investor Day to Engage Shareholders
Neutral
Jun 11, 2026
DXC Technology will host its previously announced Investor Day for financial analysts and institutional investors in New York City on June 11, 2026, starting at 9:00 a.m. ET. The company has posted the presentation that will be used at the event o...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.