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DXC Technology (DXC) Outpaces Stock Market Gains: What You Should Know

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DXC Technology (DXC - Free Report) closed at $57 in the latest trading session, marking a +1.82% move from the prior day. This change outpaced the S&P 500's 0.8% gain on the day. At the same time, the Dow added 0.82%, and the tech-heavy Nasdaq gained 1.14%.

Coming into today, shares of the information technology company had lost 14.86% in the past month. In that same time, the Computer and Technology sector lost 5.07%, while the S&P 500 lost 3.2%.

Wall Street will be looking for positivity from DXC as it approaches its next earnings report date. This is expected to be May 23, 2019. On that day, DXC is projected to report earnings of $2.07 per share, which would represent a year-over-year decline of 9.21%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.31 billion, down 15.61% from the year-ago period.

Investors should also note any recent changes to analyst estimates for DXC. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.34% higher within the past month. DXC is currently a Zacks Rank #2 (Buy).

Investors should also note DXC's current valuation metrics, including its Forward P/E ratio of 6.04. For comparison, its industry has an average Forward P/E of 18.5, which means DXC is trading at a discount to the group.

Meanwhile, DXC's PEG ratio is currently 0.91. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Computers - IT Services industry currently had an average PEG ratio of 1.57 as of yesterday's close.

The Computers - IT Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 75, putting it in the top 30% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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