Amdocs Ltd (NASDAQ: DOX)

Sector: Technology Industry: Software - Infrastructure CIK: 0001062579
Market Cap 7.51 Bn
P/B 2.20
P/E 13.16
P/S 1.64
ROIC (Qtr) 13.88
Div Yield % 3.08
Rev 1y % (Qtr) 4.13
Total Debt (Qtr) 952.36 Mn
Debt/Equity (Qtr) 0.28
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About

Amdocs Ltd., a leading provider of software and services for the communications and media industry, operates on a global scale, serving over 400 service providers worldwide. The company's primary business activities include developing, implementing, and managing software and services for the communications and media industry, with a focus on customer experience, digital transformation, and cloud migration. Amdocs Ltd. operates in several segments, including customer experience, monetization, and intelligent networking. Amdocs generates revenue...

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Investment thesis

Bull case

  • Strong operating cash flow of 863.72M provides robust 0.91x coverage of total debt 952.36M, indicating excellent debt servicing capability and financial flexibility.
  • Operating cash flow of 863.72M provides exceptional 267.08x coverage of minority interest expenses 3.23M, showing strong core operations.
  • Operating cash flow of 863.72M provides exceptional 19.96x coverage of interest expenses 43.28M, showing strong debt service capability.
  • Strong tangible asset base of 3.10B provides 3.25x coverage of total debt 952.36M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 754.89M exceeds capital expenditure of 108.84M by 6.94x, indicating strong organic growth funding capability.

Bear case

  • Operating cash flow of 863.72M barely covers its investment activities of (192.21M), with a coverage ratio of -4.49, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (192.21M) provide weak support for R&D spending of 338.49M, which is -0.57x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of 863.72M provides thin coverage of dividend payments of (227.47M) with a -3.80 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 247.88M provide limited coverage of acquisition spending of (223.72M), which is -1.11x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Operating cash flow of 863.72M is outpaced by equity issuance of (534.44M) (-1.62 ratio), indicating concerning reliance on equity markets for funding operations.

Geographical Breakdown of Revenue (2025)

Product and Service Breakdown of Revenue (2025)

Peer comparison

Companies in the Software - Infrastructure
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 MSFT Microsoft Corp 2,948.93 Bn 24.73 9.65 57.61 Bn
2 ORCL Oracle Corp 734.55 Bn 67.24 19.76 124.39 Bn
3 PLTR Palantir Technologies Inc. 313.28 Bn 192.78 70.00 0.23 Bn
4 PANW Palo Alto Networks Inc 109.38 Bn 97.90 11.45 0.35 Bn
5 CRWD CrowdStrike Holdings, Inc. 102.48 Bn -326.20 22.45 0.82 Bn
6 SNPS Synopsys Inc 69.14 Bn 51.90 9.80 14.29 Bn
7 NET Cloudflare, Inc. 66.52 Bn -645.60 33.04 3.50 Bn
8 FTNT Fortinet, Inc. 62.73 Bn 33.48 9.57 1.00 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.26 2.10
EV to Cash from Ops. EV/CFO 9.28 3.92
EV to Debt EV to Debt 8.42 -2.43
EV to EBIT EV/EBIT 10.89 11.57
EV to EBITDA EV/EBITDA 8.53 18.19
EV to Free Cash Flow [EV/FCF] EV/FCF 10.62 19.98
EV to Market Cap EV to Market Cap 1.07 1.27
EV to Revenue EV/Rev 1.75 29.29
Price to Book Value [P/B] P/B 2.20 4.97
Price to Earnings [P/E] P/E 13.16 -12.45
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 2.51 0.21
Dividend Payout Ratio % Div Payout % (Qtr) 40.50 2.73
Dividend per Basic Share Div per Share (Qtr) 2.11 0.11
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 30.28 1.67
Interest Coverage Int. cover (Qtr) 17.01 -16.04
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -22.14 -403.22
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -28.98 223.80
Dividend Growth (1y) % Div 1y % (Qtr) 10.02 -0.28
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 15.72 585.97
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 11.89 5.89
EBIT Growth (1y) % EBIT 1y % (Qtr) 15.04 27.96
EBT Growth (1y) % EBT 1y % (Qtr) 14.38 20.61
EPS Growth (1y) % EPS 1y % (Qtr) 19.54 144.77
FCF Growth (1y) % FCF 1y % (Qtr) 35.17 50.30
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -1.64 45.98
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.72 0.65
Cash Payout Ratio Cash Payout (Qtr) 0.23 0.01
Cash Ratio Cash Ratio (Qtr) 0.17 1.23
Current Ratio Curr Ratio (Qtr) 1.06 2.63
Debt to Equity Ratio Debt/Equity (Qtr) 0.28 0.73
Interest Cover Ratio Int Coverage (Qtr) 17.01 -16.04
Times Interest Earned Times Interest Earned (Qtr) 17.01 -16.04
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 20.40 -549.97
EBIT Margin % EBIT Margin % (Qtr) 16.08 -240.33
EBT Margin % EBT Margin % (Qtr) 15.13 -608.68
Gross Margin % Gross Margin % (Qtr) 37.60 51.14
Net Profit Margin % Net Margin % (Qtr) 12.50 -611.28