DXC Technology ( DXC Quick Quote DXC - Free Report) recently announced that Lloyd’s of London, the marketplace for commercial, corporate and specialty risk solutions, has selected it as the lead IT provider for its hugely ambitious digital transformation effort.
The International Underwriting Association is also a party under the multi-year agreement. Also, the agreement has received support from the Lloyd’s Market Association.
Lloyd’s intends to transform its current paper-based and analog set of processes into a completely automated, data-focused and cost efficient process. Per the agreement, DXC will design the entire architecture of Lloyd’s IT system and develop a cloud-native digital platform, which will run on
Amazon’s ( AMZN Quick Quote AMZN - Free Report) Amazon Web Services. This, in turn, will replace the legacy mainframes while automating manual processes.
The transition is anticipated to increase the security, resilience and speed of the new application deployment in the London insurance market. With enhanced data insights and analytics tools, the market is likely to derive more business value and increase its ability to quickly adapt to market conditions.
DXC is currently focusing on the cloud computing market, cyber business and Big Data business. Clients are relying increasingly on cloud-based services as these make the IT system more agile and productive, which leads to considerable cost savings. However, the segment is still underpenetrated.
Per Gartner, worldwide IT spending is anticipated at $4.5 trillion in 2021, suggesting an increase of 5.5% from 2021. The research firm expects worldwide spending on IT services to grow 8.6% year over year to $1.29 trillion this year. Therefore, DXC, a major player in the space, is anticipated to benefit from this untapped opportunity.
DXC is vying for partnerships to enhance its offerings. Also, the company is looking to expand the existing networking-based infrastructure with the benefits of
VMware’s ( VMW Quick Quote VMW - Free Report) hybrid cloud offerings. The move has helped DXC in strengthening its position in the virtualization server market. The partnership enabled the company to offer an efficient and improved hybrid IT environment to drive performance.
It has also entered into a partnership with Amazon to develop cloud-based solutions for enterprise and public sector clients. The company’s focus on entering into strategic partnerships will not only help it expand in the cloud computing space but also garner additional revenues.
Zacks Rank & Stocks to Consider
Currently, DXC and Amazon carry a Zacks Rank #3 (Hold), while VMware has a Zacks Rank #2 (Buy). The long-term expected earnings growth rate for DXC, AMZN and VMW is currently pegged at 27.4%, 24.7% and 12.7%, respectively.
A top-ranked stock from the broader technology sector is
Broadcom ( AVGO Quick Quote AVGO - Free Report) , which currently sports a Zacks Rank #1 (Strong Buy). You can see . the complete list of today’s Zacks #1 Rank stocks here
The Zacks Consensus Estimate for Broadcom’s first-quarter fiscal 2022 earnings has been revised upward by 8.1% to $8.15 per share over the past 60 days. For fiscal 2022, earnings estimates have moved upward by 6.5% to $33.03 per share over the past 60 days.
Broadcom’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 1.4%. Shares of AVGO have rallied 32.1% in the trailing 12 months.