it seems yesterday's numbers were not well received by the markets, with shares down some 13% on opening.
Lest we forget, DXC shares were at $88 as recently as 23rd October. That's a total drop of around 30%. In two weeks.
Makes me wonder if we aren't seeing the beginning of the end...
They are only focused on the numbers. No-one is looking at strategy. No-one cares about strategy. Why should they when they removed its weighting from their compensation package! But lack of growth will affect them in the end, the assets and cost savings can't sustain forever.
The Price based on Estimated Growth (PEG) which is price earnings divided by growth rate, is still below industry average. It's current high ratio means investors are paying more for earnings growth than they were this time last year.
No doubt the analysts will predict a 61% growth to 105 per share again and we play another silly year of ignoring real growth in favour of virtual assets and EPS.
"dont forget he promised another additional 250-350 basis points increase in EPS"
Yes he did and I believe that and the accelerated share buybacks were an attempt to appease the market when it was quite apparent the scale of the f*** up this time around.
I seem to remember one or more of the analysts questioned how the EPS rise prediction was going to be possible in light of the train wreck they were looking at. Mikey said of course its possible, I'll just wreck a few more families.... before later trying to bluff his was out of having to admit to cutting all that number of employees is actually hurting the business.
I'd love to say he's a dead duck but i'm not sure he is yet. Certainly Wall Street are getting angry now though, which is a start.
"I suspect what will happen is a continued slow but steady decline, with one of the big outsourcing companies picking up the remains of DXC. It will be a sad end to many decades of hard work by tens of thousands of people."
I think you are right, except that I believe there will only be ONE outsourcer left at the end of this.
I suspect fairly soon you will start to see "legacy" rollup into one of the players who will specialise in it.
Like a services version of MicroFocus...
dont forget he promised another additional 250-350 basis points increase in EPS and said in the Q&A that it would come from workforce optimization. next couple of years will be bad for the folks tagged as legacy
ENRON 2.0
@izb Agreed that DXC is making money and not about to go bust. However merely being profitable is no longer sufficient for investors - companies have to grow revenue, at which DXC is failing.
I suspect what will happen is a continued slow but steady decline, with one of the big outsourcing companies picking up the remains of DXC. It will be a sad end to many decades of hard work by tens of thousands of people.
Looks like the stock could go to an all time low. Taken a real tumble today.
The company won’t go bust, it’s making money. Not as much as the markets would like but there is a profit.
However are we seeing the end of Lawrie. The cuts took a LOT out of the people, then it was the merger, that’s still ongoing, some signs of progress but a long way to go. Given that there is zero chance he can do another merger or stunt without mass disruption could this be the point that he starts to get questioned by the board and is booted. The company has been looted, the employees have been raped, there isn’t much left for him now surely?
Especially if there is no light at the end of the current quarter. Christmas generally is a slow time for these types of companies.
As a former CSC/DXC employee, this is like apples and oranges for me. I am certain many can relate.
Stock Price: New company skyrocketing, while DXC on downward death spiral.
Bonus: New company pays generous bonus to ALL employees, while I never heard the word uttered at DXC/CSC
Pay: Regular annual increases based on performance at new company ; DXC/CSC no raise in years
Headquarters: Brand new gleaming headquarters in trendy downtown neighborhood; CSC/DXC only visited once, since I worked at client site.
CEO: New company has well-liked CEO demonstrating leadership and growth and vision for company; CSC/DXC has a brainless twit, whose sole mission is to fund his own greedy retirement on the backs of others.
Cache: Everyone knows and loves the new company; CSC/DXC is a stain on the resume/CV.
Wonder how many of those who bought when they were high 90’s are regretting it now?
Drop another 30% until they change is screwed up management