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DXC Technology
(NYSE:DXC)
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Rating:46Neutral
Price Target:
$9.50
▼(-26.75% Downside)
Action:Reiterated
Date:06/27/26
DXC scores low primarily due to persistent revenue contraction and very weak/volatile profitability (near break-even), which also contributes to an unfavorable valuation (very high P/E). Technicals reinforce caution with a clear downtrend (price below key moving averages and negative MACD). These negatives are partially offset by improved financial risk from substantial debt reduction and still-solid cash generation, while the earnings call adds a mixed signal—execution progress and AI/product momentum, but guidance points to continued near-term top-line and margin pressure.
Positive Factors
Balance-sheet de-risking
Material debt reduction and a positive equity base materially lower financial risk, freeing headroom for bond retirements, targeted buybacks and capex. Improved leverage supports funding of transformation initiatives and cushions the business through continued top-line pressure.
Negative Factors
Multi-year revenue decline
Sustained top-line contraction erodes operating leverage, reduces scale benefits and pressures margins and return metrics. Prolonged revenue shrinkage constrains reinvestment capacity and makes turnaround dependent on durable recoveries in bookings and large-account remediation.
Read all positive and negative factors
Positive Factors
Negative Factors
Balance-sheet de-risking
Material debt reduction and a positive equity base materially lower financial risk, freeing headroom for bond retirements, targeted buybacks and capex. Improved leverage supports funding of transformation initiatives and cushions the business through continued top-line pressure.
Read all positive factors
DXC Technology Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyDXC Technology (DXC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.61B
Dividend YieldN/A
Average Volume (3M)6.18M
Price to Earnings (P/E)100.8
Beta (1Y)0.98
Revenue Growth-1.76%
EPS Growth-96.67%
CountryUS
Employees130,000
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)0.10
Shares Outstanding162,080,260
10 Day Avg. Volume5,607,316
30 Day Avg. Volume6,184,833
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 Cap2.47
Enterprise Value/Revenue0.31
Enterprise Value/Gross Profit2.12
Enterprise Value/Ebitda2.80
Forecast
1Y Price Target
$11.75Price Target Upside-9.41% Downside
Rating ConsensusHold
Number of Analyst Covering6
EPS Forecast (FY)2.57
Revenue Forecast (FY)$12.18B
DXC Technology Business Overview & Revenue Model
Company Description
DXC Technology Company, along with its affiliated entities, delivers a comprehensive suite of IT solutions and services across various global regions, with a significant presence in North America, Europe, Asia, and Australia. The company structure...
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:May 07, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Jul 30, 2026
Earnings Call Sentiment Neutral
The call conveyed a mixed picture: clear operational progress (AI adoption, product launches like OASIS and Core Ignite, insurance growth, strong free cash flow and balance sheet improvement) but material near-term commercial weakness (Q4 revenue miss, bookings declines, significant GIS deterioration, and guidance for continued revenue decline and margin pressure). Management emphasized execution improvements and a conservative approach to modeling AI revenue contributions, but the financial guidance indicates the company expects the top-line challenges to continue into FY2027 before improvement later in the year.Positive Updates
Profitability and Cash Flow Ahead of Guidance
Adjusted EBIT margin in Q4 was 7.6%, up 30 basis points year-over-year and slightly above guidance; non-GAAP EPS for Q4 was $0.77 (high end of guidance). Free cash flow for Q4 was $110 million and full-year fiscal 2026 free cash flow was $713 million (up from $687 million last year), outperforming expectations.
Negative Updates
Revenue Declines and Missed Q4 Guide
Total revenue in Q4 was $3.1 billion, down 6.6% year-over-year and missed the organic guide by approximately $75 million (about 2 points). Full-year fiscal 2026 revenue was $12.6 billion, down 4.8% year-over-year.
Read all updates
Q4-2026 Updates
Positive
Negative
Profitability and Cash Flow Ahead of Guidance
Adjusted EBIT margin in Q4 was 7.6%, up 30 basis points year-over-year and slightly above guidance; non-GAAP EPS for Q4 was $0.77 (high end of guidance). Free cash flow for Q4 was $110 million and full-year fiscal 2026 free cash flow was $713 million (up from $687 million last year), outperforming expectations.
Read all positive updates
Company Guidance
DXC guided fiscal 2027 organic revenue to decline 3–5% year‑over‑year (with a 3–4 point improvement in the rate of decline in H2), targeting adjusted EBIT margin of 6–7%, non‑GAAP diluted EPS of $2.40–$2.90 and free cash flow of about $600 million. For Q1 FY27 the company expects organic revenue down 6.5–7.5% YoY, CES and GIS to decline mid‑single digits, insurance to grow low single digits, adjusted EBIT margin of ~5% and non‑GAAP EPS of ~$0.40. Segment detail: GIS is expected to be down mid‑single digits for the year, CES mid‑single digits throughout, and insurance to be roughly in line with FY26 (insurance was +3.6% for FY26 and +4% in Q4) with improvement in the back half driven by new contracts and AI-enabled smart apps. Capital priorities include deploying ~ $400M to retire U.S. dollar bonds maturing in September, repurchasing $250M of shares in FY27 (to be executed more evenly), and continued capital‑lease reduction; for context FY26 revenue was $12.6B (‑4.8% YoY), Q4 revenue was $3.1B (‑6.6%), Q4 adjusted EBIT margin was 7.6%, Q4 non‑GAAP EPS was $0.77 and FY26 free cash flow was $713M.DXC Technology Financial Statement Overview
Summary
Income Statement
36
Negative
Balance Sheet
58
Neutral
Cash Flow
62
Positive
| Breakdown | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 12.64B | 12.87B | 13.67B | 14.43B | 16.27B |
| Gross Profit | 1.87B | 3.10B | 3.09B | 3.18B | 3.58B |
| EBITDA | 1.69B | 2.21B | 1.84B | 866.00M | 3.09B |
| Net Income | 18.00M | 389.00M | 91.00M | -568.00M | 718.00M |
Balance Sheet | |||||
| Total Assets | 12.89B | 13.21B | 13.87B | 15.85B | 20.14B |
| Cash, Cash Equivalents and Short-Term Investments | 1.74B | 1.80B | 1.22B | 1.86B | 2.67B |
| Total Debt | 4.25B | 4.55B | 4.87B | 5.37B | 6.17B |
| Total Liabilities | 9.68B | 9.71B | 10.80B | 12.03B | 14.76B |
| Stockholders Equity | 2.94B | 3.23B | 2.81B | 3.50B | 5.05B |
Cash Flow | |||||
| Free Cash Flow | 1.04B | 822.00M | 954.00M | 1.15B | 1.25B |
| Operating Cash Flow | 1.25B | 1.40B | 1.36B | 1.42B | 1.50B |
| Investing Cash Flow | -484.00M | -512.00M | -491.00M | -635.00M | -60.00M |
| Financing Cash Flow | -776.00M | -317.00M | -1.49B | -1.51B | -1.82B |
DXC Technology Technical Analysis
Neutral
12.97
Price Trends
9.71
Positive
11.13
Negative
12.57
Negative
Market Momentum
-0.13
Negative
59.36
Neutral
81.32
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DXC, the sentiment is Neutral. The current price of 12.97 is above the 20-day moving average (MA) of 8.90, above the 50-day MA of 9.71, and above the 200-day MA of 12.57, indicating a neutral trend. The MACD of -0.13 indicates Negative momentum. The RSI at 59.36 is Neutral, neither overbought nor oversold. The STOCH value of 81.32 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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 |
|---|---|---|---|---|---|---|---|
75 Outperform | $19.90B | 9.11 | 14.79% | 1.46% | 6.55% | -3.10% | |
71 Outperform | $4.93B | 8.82 | 22.44% | 1.41% | 6.47% | 10.82% | |
71 Outperform | $44.62B | 13.28 | 31.77% | 2.58% | 4.85% | 6.19% | |
68 Neutral | $4.61B | 12.61 | 10.67% | ― | 14.21% | -2.92% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
51 Neutral | $2.70B | 14.32 | 16.40% | ― | 0.23% | -20.13% | |
46 Neutral | $1.61B | 100.81 | 0.58% | ― | -1.76% | -96.67% |
* Technology Sector Average
DXC
DXC Technology
9.91
-5.68
-36.43%
CTSH
Cognizant
41.99
-36.81
-46.71%
EPAM
Epam Systems
88.27
-91.70
-50.95%
G
Genpact
29.10
-16.12
-35.65%
INFY
Infosys
11.16
-7.09
-38.84%
KD
Kyndryl Holdings Incorporation
12.25
-30.38
-71.26%
DXC Technology Corporate Events
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.