We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
DXC Technology (DXC) to Post Q1 Earnings: What's in Store?
Read MoreHide Full Article
DXC Technology (DXC - Free Report) is scheduled to report first-quarter fiscal 2023 results on Aug 3.
For the first quarter of fiscal 2023, the company anticipates revenues between $3.7 billion and $3.75 billion. The Zacks Consensus Estimate for first-quarter revenues stands at $3.71 billion, indicating a year-over-year decline of 10.3%.
DXC anticipates non-GAAP earnings between 80 cents and 85 cents per share. The consensus mark for earnings is pegged at 82 cents per share, suggesting a 2.4% year-over-year decline.
The company’s earnings outpaced estimates in two of the trailing four quarters while matching the same in one and missing one time, the average surprise being 0.8%.
Let’s see how things have shaped up before the upcoming announcement.
DXC’s first-quarter performance is likely to have been negatively impacted by the business operation closure in Russia following the Kremlin force’s invasion of Ukraine. On its last earnings conference call, the company stated that the exit from Russia would reduce its total revenues by approximately $140 million every fiscal.
The strong U.S. dollar against major currencies and the concluded divestments of certain business units in the past 12 months are also anticipated to have negatively impacted the first-quarter top line. The company projected unfavorable foreign currency exchange rates and divestitures would reduce first-quarter sales by $200 million and $100 million, respectively, and $800 million and $300 million for full-fiscal 2023.
Apart from this, a weak traditional business might have weighed on the to-be-reported quarter's performance. However, sequential revenue stabilization is expected to have continued.
However, the negative impacts of the aforementioned factors might have partially offset by DXC’s strength in the digital business and partnerships, which is helping it expand in the cloud computing space. Increased IT spending is anticipated to have contributed to the top line in the quarter to be reported.
Moreover, margins are anticipated to have benefited from the company’s cost-saving initiatives and reduction in debts, which are likely to have lowered its interest expenses during the quarter. DXC projects the adjusted EBIT margin in the range of 7.5-8% in the first quarter.
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 of #4 (Sell) and has an Earnings ESP of -0.87%. 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, MRC Global (MRC - Free Report) , Alcon (ALC - Free Report) and Grocery Outlet (GO - Free Report) have the right combination of elements to post an earnings beat in their upcoming releases.
MRC Global is slated to report second-quarter 2022 results on Aug 8. The company sports a Zacks Rank #1 and an Earnings ESP of +30.27% at present. MRC's earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while matching the same in one, the average surprise being 140.8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for MRC’s quarterly earnings is pegged at 25 cents per share, suggesting a whopping year-over-year surge of 212.5%. Its quarterly revenues are estimated to increase 23.4% year over year to $846.5 million.
Alcon sports a Zacks Rank #1 and an Earnings ESP of +1.08%. The company is expected to report second-quarter 2022 results on Aug 16. ALC's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 21.4%.
For the second quarter, the Zacks Consensus Estimate for Alcon’s earnings is pegged at 55 cents per share, indicating a 1.8% year-over-year decline. However, revenues are expected to grow 4.4% to $2.19 billion.
Grocery Outlet carries a Zacks Rank #2 and has an Earnings ESP of +5.62. The company is anticipated to report its second-quarter 2022 results on Aug 9. Its earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 4.8%.
The Zacks Consensus Estimate for GO’s second-quarter earnings stands at 24 cents per share, suggesting a year-over-year increase of 4.4%. Grocery Outlet anticipates revenues of $859.6 million, which suggests growth of 10.8% from the year-ago quarter.
Image: Bigstock
DXC Technology (DXC) to Post Q1 Earnings: What's in Store?
DXC Technology (DXC - Free Report) is scheduled to report first-quarter fiscal 2023 results on Aug 3.
For the first quarter of fiscal 2023, the company anticipates revenues between $3.7 billion and $3.75 billion. The Zacks Consensus Estimate for first-quarter revenues stands at $3.71 billion, indicating a year-over-year decline of 10.3%.
DXC anticipates non-GAAP earnings between 80 cents and 85 cents per share. The consensus mark for earnings is pegged at 82 cents per share, suggesting a 2.4% year-over-year decline.
The company’s earnings outpaced estimates in two of the trailing four quarters while matching the same in one and missing one time, the average surprise being 0.8%.
Let’s see how things have shaped up before the upcoming announcement.
DXC Technology Company. Price and EPS Surprise
DXC Technology Company. price-eps-surprise | DXC Technology Company. Quote
Factors to Consider
DXC’s first-quarter performance is likely to have been negatively impacted by the business operation closure in Russia following the Kremlin force’s invasion of Ukraine. On its last earnings conference call, the company stated that the exit from Russia would reduce its total revenues by approximately $140 million every fiscal.
The strong U.S. dollar against major currencies and the concluded divestments of certain business units in the past 12 months are also anticipated to have negatively impacted the first-quarter top line. The company projected unfavorable foreign currency exchange rates and divestitures would reduce first-quarter sales by $200 million and $100 million, respectively, and $800 million and $300 million for full-fiscal 2023.
Apart from this, a weak traditional business might have weighed on the to-be-reported quarter's performance. However, sequential revenue stabilization is expected to have continued.
However, the negative impacts of the aforementioned factors might have partially offset by DXC’s strength in the digital business and partnerships, which is helping it expand in the cloud computing space. Increased IT spending is anticipated to have contributed to the top line in the quarter to be reported.
Moreover, margins are anticipated to have benefited from the company’s cost-saving initiatives and reduction in debts, which are likely to have lowered its interest expenses during the quarter. DXC projects the adjusted EBIT margin in the range of 7.5-8% in the first quarter.
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 of #4 (Sell) and has an Earnings ESP of -0.87%. 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, MRC Global (MRC - Free Report) , Alcon (ALC - Free Report) and Grocery Outlet (GO - Free Report) have the right combination of elements to post an earnings beat in their upcoming releases.
MRC Global is slated to report second-quarter 2022 results on Aug 8. The company sports a Zacks Rank #1 and an Earnings ESP of +30.27% at present. MRC's earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while matching the same in one, the average surprise being 140.8%. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for MRC’s quarterly earnings is pegged at 25 cents per share, suggesting a whopping year-over-year surge of 212.5%. Its quarterly revenues are estimated to increase 23.4% year over year to $846.5 million.
Alcon sports a Zacks Rank #1 and an Earnings ESP of +1.08%. The company is expected to report second-quarter 2022 results on Aug 16. ALC's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 21.4%.
For the second quarter, the Zacks Consensus Estimate for Alcon’s earnings is pegged at 55 cents per share, indicating a 1.8% year-over-year decline. However, revenues are expected to grow 4.4% to $2.19 billion.
Grocery Outlet carries a Zacks Rank #2 and has an Earnings ESP of +5.62. The company is anticipated to report its second-quarter 2022 results on Aug 9. Its earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 4.8%.
The Zacks Consensus Estimate for GO’s second-quarter earnings stands at 24 cents per share, suggesting a year-over-year increase of 4.4%. Grocery Outlet anticipates revenues of $859.6 million, which suggests growth of 10.8% from the year-ago quarter.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.