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DXC Technology (DXC) to Report Q1 Earnings: What's in Store?

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DXC Technology Company’s (DXC - Free Report) first-quarter fiscal 2022 results are scheduled to be out on Aug 4.

For the fiscal first quarter, DXC projects revenues between $4.08 billion and $4.13 billion. The Zacks Consensus Estimate for quarterly revenues is pinned at $4.11 billion, calling for an 8.7% year-over-year decline.

Moreover, DXC expects non-GAAP earnings to come in at 72-76 cents per share. The consensus mark for earnings is pegged at 75 cents per share, suggesting more than a 257% year-over-year jump.

The company’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 55.2%.

Let’s see how things have shaped up prior to the upcoming announcement.

DXC Technology Company. Price and EPS Surprise DXC Technology Company. Price and EPS Surprise

DXC Technology Company. price-eps-surprise | DXC Technology Company. Quote

Key Factors

DXC’s fiscal first-quarter performance is expected to have been affected by the pandemic-induced business disruptions. Quarterly results might also have been hurt by soft IT spending as organizations are pushing back their investments in big and expensive technology products due to the global economic slowdown concerns amid the coronavirus crisis.

DXC’s top line is likely to reflect the negative impact of previous business terminations and runoffs. However, sequential revenue stabilization is expected to have continued. During the last earnings call, the company had stated that business terminations and runoffs mainly caused a 7% year-over-year decline in fourth-quarter fiscal 2021 organic revenues.

Apart from this, a weak traditional business is expected to have dampened the top line during the quarter under review.

What Our Model Says

Our proven model does not predict an earnings beat for DXC this season. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

DXC currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%.

Stocks With Favorable Combinations

Here are some companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming release:

Avnet, Inc. (AVT - Free Report) has an Earnings ESP of +9.82% and currently flaunts a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

CACI International (CACI - Free Report) has an Earnings ESP of +6.62% and holds a Zacks Rank of 2, currently.

Arrow Electronics (ARW - Free Report) has an Earnings ESP of +0.77% and carries a Zacks Rank #2, at present.