Yahoo Finance DXC Technology (DXC) to Report Q4 Earnings: What's in Store?
DXC Technology DXC is slated to report fourth-quarter fiscal 2024 results on May 16.
For the fourth quarter of fiscal 2024, the company anticipates revenues between $3.35 billion and $3.39 billion. The Zacks Consensus Estimate for fiscal fourth-quarter revenues stands at $3.37 billion, which indicates a year-over-year decline of 6.1%.
DXC anticipates non-GAAP earnings between 80 cents and 85 cents per share. The consensus mark for earnings is pegged at 83 per share, which suggests an 18.6% year-over-year decrease.
The company’s earnings outpaced estimates twice in the trailing four quarters while matching on one occasion and missing once, with an average surprise of -1.8%.
Let’s see how things are shaping up for this announcement.
DXC Technology Company. Price and EPS Surprise
DXC Technology Company. price-eps-surprise | DXC Technology Company. Quote
Factors to Consider
DXC’s fourth-quarter performance is likely to have been negatively impacted by softening IT spending as organizations are pushing back their investments in big and expensive technology products amid the ongoing macroeconomic and geopolitical issues.
Moreover, a weak traditional business is likely to have weighed on the to-be-reported quarter's performance. However, sequential revenue stabilization is expected to continue.
The negative impacts of the aforementioned factors are likely to have been partially offset by DXC’s strength in the digital business and partnerships, which have been helping it expand in the cloud computing space.
The company expects fourth-quarter organic revenues to decline in the 5.5-6.5% range. The year-over-year expected organic revenue decrease is mainly due to an anticipated weak performance in DXC’s Global Infrastructure Services (“GIS”) and Global Business Services (“GBS”) segments.
The GIS segment’s fourth-quarter performance is likely to have been negatively impacted by weakness in the Modern Workplace areas, which are parts of this division.
Furthermore, the revenue shortfall is likely to have weighed on fourth-quarter margins. DXC projects the adjusted EBIT margin in the range of 7%-7.5% in the fiscal fourth quarter.
However, DXC’s cost-saving initiatives and lower interest expenses are likely to have partially offset the negative impact of the revenue shortfall on bottom-line results. Apart from the abovementioned factors, a reduction in shares outstanding on the company’s aggressive share repurchase initiative is likely to have boosted the EPS.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for DXC this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that’s not the case here.
DXC currently carries a Zacks Rank #4 (Sell) and has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Per our model, NVIDIA NVDA, Zscaler ZS and Agilent Technologies A have the right combination of elements to post an earnings beat in their upcoming releases.
NVIDIA sports a Zacks Rank #1 and has an Earnings ESP of +2.50%. The company is scheduled to report first-quarter fiscal 2025 results on May 22. Its earnings beat the Zacks Consensus Estimate in the preceding four quarters, with the average surprise being 20.2%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for NVIDIA’s first-quarter earnings stands at $5.49 per share, which indicates a year-over-year improvement of 403.7%. It is estimated to report revenues of $24.17 billion, which suggests an increase of approximately 236.1% from the year-ago quarter.
Zscaler carries a Zacks Rank #2 and has an Earnings ESP of +0.39%. The company is expected to report third-quarter fiscal 2024 results on Jun 6. Its earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 28.2%.
The Zacks Consensus Estimate for Zscaler’s third-quarter earnings is pegged at 65 cents per share, which indicates a year-over-year increase of 35.4%. The consensus mark for revenues stands at $535.6 million, which calls for a year-over-year rise of 27.9%.
Agilent Technologies is slated to report second-quarter fiscal 2024 results on May 29. The company has a Zacks Rank #3 and an Earnings ESP of +0.42% at present. Agilent Technologies’ earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 3.5%.
The Zacks Consensus Estimate for second-quarter earnings is pegged at $1.19 per share, which suggests a decrease of 6.3% from the year-ago quarter’s earnings of $1.27. Agilent Technologies’ quarterly revenues are estimated to decline 8% to $1.58 billion from $1.72 billion in the year-ago quarter.
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NVIDIA Corporation (NVDA) : Free Stock Analysis Report
Agilent Technologies, Inc. (A) : Free Stock Analysis Report
DXC Technology Company. (DXC) : Free Stock Analysis Report
Zscaler, Inc. (ZS) : Free Stock Analysis Report
