Reviewing Amdocs (DOX) & Its Peers

Amdocs (NASDAQ:DOX) is one of 55 public companies in the “IT Services” industry, but how does it weigh in compared to its competitors? We will compare Amdocs to related companies based on the strength of its dividends, valuation, institutional ownership, risk, earnings, profitability and analyst recommendations.

Insider and Institutional Ownership

92.0% of Amdocs shares are held by institutional investors. Comparatively, 62.6% of shares of all “IT Services” companies are held by institutional investors. 15.4% of Amdocs shares are held by company insiders. Comparatively, 11.4% of shares of all “IT Services” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Amdocs and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Amdocs	12.47%	20.19%	11.23%
Amdocs Competitors	-127.05%	-4.18%	5.09%

Dividends

Amdocs pays an annual dividend of $2.28 per share and has a dividend yield of 3.6%. Amdocs pays out 44.1% of its earnings in the form of a dividend. As a group, “IT Services” companies pay a dividend yield of 1.8% and pay out 34.5% of their earnings in the form of a dividend. Amdocs has raised its dividend for 14 consecutive years.

Earnings and Valuation

This table compares Amdocs and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Amdocs	$4.53 billion	$564.70 million	12.19
Amdocs Competitors	$5.62 billion	$513.97 million	85.35

Amdocs’ competitors have higher revenue, but lower earnings than Amdocs. Amdocs is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Volatility & Risk

Amdocs has a beta of 0.46, meaning that its share price is 54% less volatile than the S&P 500. Comparatively, Amdocs’ competitors have a beta of -7.91, meaning that their average share price is 891% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for Amdocs and its competitors, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Amdocs	0	2	3	0	2.60
Amdocs Competitors	543	2919	5704	231	2.60

Amdocs presently has a consensus target price of $92.33, suggesting a potential upside of 46.56%. As a group, “IT Services” companies have a potential upside of 62.94%. Given Amdocs’ competitors higher probable upside, analysts clearly believe Amdocs has less favorable growth aspects than its competitors.

Summary

Amdocs beats its competitors on 9 of the 15 factors compared.

About Amdocs

Amdocs Limited, through its subsidiaries, provides software and services worldwide. It designs, develops, operates, implements, supports, and markets open and modular cloud portfolio. The company provides CES23, a 5G and cloud-native microservices-based market-leading customer experience suite, that enables service providers to build, deliver, and monetize advanced services; Amdocs Subscription Marketplace, a software-as-a-service-based platform that includes an expansive network of pre-integrated digital services, such as media, gaming, eLearning, sports, and retail to security and business services; the monetization suite for charging, billing, policy, and revenue management; Intelligent networking suite with a set of modular, flexible, and open service lifecycle management capabilities for network automation journeys; amAIz, a telco GenAI framework; Amdocs Digital Brands Suite, a pre-integrated digital business suite; and Amdocs eSIM Cloud for service providers. It also offers AI-powered, cloud-native, and home operating systems; data intelligence solutions and applications; end-to-end application development and maintenance services; and ongoing maintenance services. In addition, the company provides a line of services designed for various stages of a service provider’s lifecycle includes consulting, delivery, quality engineering, operations, systems integration, network services, experience-driven services, data, cloud, and content services; managed services comprising application development, modernization and maintenance, IT and infrastructure services, testing and professional services that are designed to assist customers in the selection, implementation, operation, management, and maintenance of IT systems. It serves to the communications, entertainment, and media industry service providers, as well as mobile virtual network operators. Amdocs Limited was founded in 1988 and is headquartered in Saint Louis, Missouri.