Virtusa (VRTU:NAS) Fundamental Valuation Report

Fundamental Valuation Report

Virtusa(VRTU:NAS)

Technology:Information Technology Services

This Report was generated using the valuation tools available on StockCalc.com. For a free 30 day trial click here.

Close Price/Date
$46.24 (USD) 10/01/2019

Weighted Valuation
$56.05 (USD)

Overall Rating
Undervalued by 21.2%

Valuation Models Analyst Consensus: $63.00 (USD)
(in order of importance) Adjusted Book Value: $48.12 (USD)
Multiples: $51.06 (USD)
Valuation Methods This company is:
Cash Flow: Overvalued on a Cash Flow Valuation
Comparable Company: Overvalued on a Comparable Valuation
Asset: Fairly valued on an Asset Valuation

Company Overview (VRTU:NAS USD)

Price 46.24
Range 44.48 – 46.27
52 week 38.07 – 58.30
Open 44.62
Vol / Avg. 144876/218467
Mkt cap 1.38B
P/E 0.00
Div/yield 0.00/0.00
EPS -0.09
Shares 29.91M
Beta 1.03

Company Description

Virtusa Corp provides a range of information technology, or IT, services. The company organizes its services into three categories: business and IT consulting, technology implementation, and application outsourcing. The business and IT consulting services include IT assessment and planning, network architecture and design, and governance-related services. The technology implementation services include application development, legacy asset management, information management, and testing. The application outsourcing services include application and platform management, infrastructure management, and software quality assurance management. The company generates the majority of revenue from North America.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for VRTU:NAS

Using a discounted cash flow model we generated an intrinsic value of $29.40 (USD) for VRTU:NAS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

VRTU:NAS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $29.40 1% 5% 1% 5%
WACC (or Ke) 9.04 $36.59 $24.25
Terminal Growth Rate 3.00 $24.73 $35.91
Tax Rate 0.15 $32.00 $26.79
Cash Flow 112,399,480 $27.00 $31.79
Capital Expenditures -12,783,400 $29.15 $29.64
Long Term Debt 190,027,000 $29.71 $29.08

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $17.17 (USD) for VRTU:NAS. We also generated a valuation of $60.64 (USD) using other metrics and comparables.
The comparable companies were CACI International (CACI:NYS), NCR (NCR:NYS), Insight Enterprises (NSIT:NAS), Science Applications Intl (SAIC:NYS) and Xerox (XRX:NYS).

Company VRTU:NAS End Date Value
Earnings/Share ($0.55) (USD)
Book Value/Share $12.83 (USD)
Sales/Share $37.84 (USD)
Cash Flow/Share $2.18 (USD)
EBITDA/Share $2.53 (USD)
Price Based on Comps Adjustment Factor (%)
$0.00 (USD) -21.6
$43.07 (USD) -51.0
$19.29 (USD) -8.4
$6.68 (USD) -15.2
$22.57 (USD) 24.8
VRTU:NAS Ratios Used Average Values CACI:NYS NCR:NYS NSIT:NAS SAIC:NYS XRX:NYS
0.00 PE Ratio 107.82 10.78 0.00 11.23 14.06 395.20
3.32 PB Ratio 3.36 1.63 6.14 1.53 6.57 0.91
1.13 PS Ratio 0.51 0.80 0.44 0.21 0.60 0.50
19.58 PCF Ratio 7.60 11.09 4.41 5.54 11.23 5.72
20.79 EV to EBITDA 8.92 10.31 10.34 6.21 10.93 6.79

Multiples

Using a multiples approach we generated a valuation of  $51.06 (USD) for VRTU:NAS

Company VRTU:NAS End Date Value
Earnings/Share ($0.55) (USD)
Book Value/Share $12.83 (USD)
Sales/Share $37.84 (USD)
Cash Flow/Share $2.18 (USD)
EBITDA/Share $2.53 (USD)
Price Based on Comps Adjustment Factor
$0.00 (USD) 0
$38.21 (USD) 0
$58.89 (USD) 0
$60.08 (USD) 0
$47.06 (USD) 0
Ratios Ratio Average
PE Ratio 31.39
PB Ratio 2.98
PS Ratio 1.56
PCF Ratio 27.62
EV to EBITDA 18.58

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  VRTU:NAS for the last 10 years was  2.90

We ran the Adjusted Book Value for  VRTU:NAS and generated a book value of  $16.59 (USD)
By multiplying these we get an adjusted valuation of  $48.12 (USD)

Analyst Data

In the Stockcalc database there are 2 analysts that provide a valuation for VRTU:NAS. The 2 analysts have a concensus valuation for VRTU:NAS for 2020 of $63.00 (USD).

VRTU:NAS Virtusa

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
2 0 0 5.0000 Buy 2019-1-9

Current Price: 46.24 USD

Analyst Consensus
USD Millions 2019 2020
Mean EPS 2.51 2.78
# EPS Analysts 2 1
Mean Revenue 1,250.60 1,375.70
# Revenue Analysts 1 1
Mean Target Price 63.00
Mean Cash Flow
Mean EBITDA
Mean Net Income
Mean Debt Outstanding
Mean Tax Rate 70.40 32.00
Mean Growth Rate 20.00
Mean Capital Expenditure

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

Notice to User


The contents of this report and the Stockcalc website are provided on an ‘‘as is’’ or ‘‘as available’’ basis with all faults and may not be current in all cases. The information in this report or on the website is subject to continuous change and Patchell Brook Equity Analytics Inc. assumes no responsibility to update or amend such information or that the information will be current. Patchell Brook Equity Analytics Inc. does not claim that all information, calculations or opinions presented in this report or on its website are true, reliable, or complete. Accordingly, you should not rely on any of the information as authoritative or as a substitute for the exercise of your own skill and judgment in making an investment or other decision. Any information, data, opinions, calculations or recommendations provided by third parties through links to other websites or otherwise made available through this report or website are solely those of the third party and not of Patchell Brook Equity Analytics Inc. Please refer to the Terms of Use on stockcalc.com for further information.
To access all of the tools on Stockcalc, including more detailed valuation reports and the models used to generate these valuations, please subscribe for a free 30 day trial of Stockcalc here.


DXC Technology (DXC:NYS) Fundamental Valuation Report

Fundamental Valuation Report

DXC Technology(DXC:NYS)

Technology:Information Technology Services

This Report was generated using the valuation tools available on StockCalc.com. For a free 30 day trial click here.

Close Price/Date
$59.19 (USD) 09/01/2019

Weighted Valuation
$77.00 (USD)

Overall Rating
Undervalued by 30.1%

Valuation Models Analyst Consensus: $77.00 (USD)
(in order of importance)
Valuation Methods This company is:
Cash Flow: Undervalued on a Cash Flow Valuation
Comparable Company: Undervalued on a Comparable Valuation
Asset: Undervalued on an Asset Valuation

Company Overview (DXC:NYS USD)

Price 59.19
Range 58.64 – 59.98
52 week 50.03 – 96.38
Open 59.31
Vol / Avg. 3.32M/3.11M
Mkt cap 16.58B
P/E 13.23
Div/yield 0.72/0.01
EPS 6.04
Shares 280.11M
Beta 1.35

Company Description

DXC Technology is a vendor-independent IT services provider that started trading in April 2017. DXC was created via the amalgamation of Computer Sciences Corporation, or CSC, and Hewlett Packard Enterprise’s Services business. The combined company has enviable global scale, with annual revenue of around $25 billion, over 170,000 employees, operations across 70 countries, and broad industry exposure. In addition, the firm has roughly 6,000 clients, of which over 200 are within the Fortune 500.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for DXC:NYS

Using a discounted cash flow model we generated an intrinsic value of $237.08 (USD) for DXC:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

DXC:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $237.08 1% 5% 1% 5%
WACC (or Ke) 8.46 $292.98 $198.49
Terminal Growth Rate 3.00 $202.17 $287.64
Tax Rate 0.07 $250.70 $223.46
Cash Flow 4,782,247,592 $223.73 $250.43
Capital Expenditures -317,800,000 $236.30 $237.86
Long Term Debt 3,300,000,000 $237.67 $236.49

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $109.71 (USD) for DXC:NYS. We also generated a valuation of $121.27 (USD) using other metrics and comparables.
The comparable companies were CDW (CDW:NAS), Cognizant Tech Solns (CTSH:NAS), Gartner (IT:NYS), Leidos Holdings (LDOS:NYS) and Xerox (XRX:NYS).

Company DXC:NYS End Date Value
Earnings/Share $6.42 (USD)
Book Value/Share $41.05 (USD)
Sales/Share $83.65 (USD)
Cash Flow/Share $9.06 (USD)
EBITDA/Share $13.92 (USD)
Price Based on Comps Adjustment Factor (%)
$221.20 (USD) 30.4
$241.04 (USD) -58.8
$125.39 (USD) -67.2
$96.32 (USD) -75.0
$186.51 (USD) -43.8
DXC:NYS Ratios Used Average Values CDW:NAS CTSH:NAS IT:NYS LDOS:NYS XRX:NYS
7.90 PE Ratio 106.60 18.46 25.80 77.48 16.07 395.20
1.30 PB Ratio 5.87 10.47 3.35 12.34 2.29 0.91
0.64 PS Ratio 1.50 0.77 2.35 3.06 0.81 0.50
5.87 PCF Ratio 13.83 13.30 13.66 26.60 9.85 5.72
4.30 EV to EBITDA 13.40 12.30 10.20 26.52 11.21 6.79

Multiples

Using a multiples approach we generated a valuation of  $113.00 (USD) for DXC:NYS

Company DXC:NYS End Date Value
Earnings/Share $6.42 (USD)
Book Value/Share $41.05 (USD)
Sales/Share $83.65 (USD)
Cash Flow/Share $9.06 (USD)
EBITDA/Share $13.92 (USD)
Price Based on Comps Adjustment Factor
$164.57 (USD) 0
$110.14 (USD) 0
$79.21 (USD) 0
$69.97 (USD) 0
$141.13 (USD) 0
Ratios Ratio Average
PE Ratio 25.63
PB Ratio 2.68
PS Ratio 0.95
PCF Ratio 7.72
EV to EBITDA 10.14

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  DXC:NYS for the last 10 years was  2.60

We ran the Adjusted Book Value for  DXC:NYS and generated a book value of  $40.30 (USD)
By multiplying these we get an adjusted valuation of  $104.91 (USD)

Analyst Data

In the Stockcalc database there are 2 analysts that provide a valuation for DXC:NYS. The 2 analysts have a concensus valuation for DXC:NYS for 2020 of $77.00 (USD).

DXC:NYS DXC Technology

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
2 1 0 4.3333 Outperform 2019-1-8

Current Price: 59.19 USD

Analyst Consensus
USD Millions 2019 2020 2021
Mean EPS 8.11 8.73 9.60
# EPS Analysts 3 2 1
Mean Revenue 20,926.10 21,150.00 21,664.00
# Revenue Analysts 1 2 1
Mean Target Price 77.00
Mean Cash Flow 12.13 13.46
Mean EBITDA 4,296.90 4,532.80
Mean Net Income 2,317.80 2,454.90
Mean Debt Outstanding
Mean Tax Rate
Mean Growth Rate 6.11
Mean Capital Expenditure 418.50 846.60

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

Notice to User


The contents of this report and the Stockcalc website are provided on an ‘‘as is’’ or ‘‘as available’’ basis with all faults and may not be current in all cases. The information in this report or on the website is subject to continuous change and Patchell Brook Equity Analytics Inc. assumes no responsibility to update or amend such information or that the information will be current. Patchell Brook Equity Analytics Inc. does not claim that all information, calculations or opinions presented in this report or on its website are true, reliable, or complete. Accordingly, you should not rely on any of the information as authoritative or as a substitute for the exercise of your own skill and judgment in making an investment or other decision. Any information, data, opinions, calculations or recommendations provided by third parties through links to other websites or otherwise made available through this report or website are solely those of the third party and not of Patchell Brook Equity Analytics Inc. Please refer to the Terms of Use on stockcalc.com for further information.
To access all of the tools on Stockcalc, including more detailed valuation reports and the models used to generate these valuations, please subscribe for a free 30 day trial of Stockcalc here.


DXC Technology (DXC:NYS) Fundamental Valuation Report


This Report was generated using the tools available on StockCalc.com. Patchell Brook Equity Analytics Inc. emphasizes that the user assumes all risks associated with the use of this report or the Stockcalc website including, but not limited to, all terms and conditions mentioned in the legal disclaimer.
To access all of the tools on Stockcalc, including more detailed valuation reports and the models used to generate these valuations, please subscribe for a free 30 day trial of Stockcalc here.

DXC Technology $89.99 (USD) Close Price as of 29/05/2018

Based on the analysis conducted in this report, DXC Technology, (DXC:NYS) is found to be  Undervalued.

Company DXC Technology
Symbol:Exchange DXC:NYS
Industry Technology:Information Technology Services
Close Price/Date $89.99 (USD) 29/05/2018
Weighted Average Valuation $116.93 (USD)
Summary DXC:NYS is found to be  Undervalued by 29.9% using the 3 valuation models shown below.
Valuation Models Used Analyst Consensus: $109.25 (USD)
(in order of importance) Comparables: $124.97 (USD)
Adjusted Book Value: $123.89 (USD)
Valuation Methods Analysis This company is:
Cash Flow Basis: Undervalued on a Cash Flow Valuation basis
Comparable Company Basis: Undervalued on a Comparable Valuation basis
Asset Basis: Undervalued on an Asset Valuation basis

Valuation Details

DXC Technology Valuations

Summary chart

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for DXC:NYS

Using a discounted cash flow model we generated an intrinsic value of $145.59 (USD) for DXC:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

DXC:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $145.59 1% 5% 1% 5%
WACC (or Ke) 7.72 $185.39 $119.04
Terminal Growth Rate 2.70 $121.44 $181.76
Tax Rate 0.40 $159.89 $131.30
Cash Flow 4,726,356,700 $136.53 $154.65
Capital Expenditures -345,600,000 $144.91 $146.28
Long Term Debt 3,300,000,000 $146.17 $145.01

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $118.09 (USD) for DXC:NYS. We also generated a valuation of $124.97 (USD) using other metrics and comparables.
The comparable companies were CDW (CDW:NAS), Cognizant Tech Solns (CTSH:NAS), Gartner (IT:NYS), Leidos Holdings (LDOS:NYS) and Xerox (XRX:NYS)

Company DXC:NYS End Date Value
Cash/Share $0.00 (USD)
Book Value/Share $44.93 (USD)
MarketCap 25,709,050,971
1 Year Return 0.144
NetPPE 0
Price Based on Comps Adjustment Factor (%)
$0.00 (USD) 0
$229.19 (USD) 0
$56.85 (USD) 0
$88.89 (USD) 0
$0.00 (USD) 0
Ratios Used Average Values CDW:NAS CTSH:NAS IT:NYS LDOS:NYS XRX:NYS
Cash / Share 3.54 0.91 3.24 6.02 2.55 5.01
Book Value / Share 14.66 5.72 18.01 8.15 21.66 19.77
Market Cap 16,472,123,789 10,537,437,181 43,688,522,527 11,176,372,987 9,237,389,302 7,720,896,948
1 Year Return 0.13 0.36 0.12 0.11 0.09 -0.02
Net PPE 604,321,400 161,100,000 1,324,000,000 221,507,000 232,000,000 1,083,000,000

Multiples

Using a multiples approach we generated a valuation of  $174.98 (USD) for DXC:NYS

Company DXC:NYS End Date Value
Earnings/Share $6.04 (USD)
Book Value/Share $44.93 (USD)
Sales/Share $80.70 (USD)
Cash Flow/Share $10.87 (USD)
EBITDA/Share $2.07 (USD)
Price Based on Comps Adjustment Factor
$562.49 (USD) 0
$126.69 (USD) 0
$77.17 (USD) 0
$86.21 (USD) 0
$22.35 (USD) 0
Ratios Ratio Average
PE Ratio 93.13
PB Ratio 2.82
PS Ratio 0.96
PCF Ratio 7.93
EV to EBITDA 10.78

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  DXC:NYS for the last 10 years was  2.73

We ran the Adjusted Book Value for  DXC:NYS and generated a book value of  $45.33 (USD)
By multiplying these we get an adjusted valuation of  $123.89 (USD)

Analyst Data

In the Stockcalc database there are 4 analysts that provide a valuation for DXC:NYS. The 4 analysts have a concensus valuation for DXC:NYS for 2019 of $109.25 (USD).

DXC:NYS DXC Technology

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
2 2 0 3.6000 Outperform 2018-5-28

Current Price: not available

Analyst Consensus
USD Millions 2018 2019 2020
Mean EPS 7.90 8.57 9.45
# EPS Analysts 4 4 2
Mean Revenue 24,556.00 21,958.80 22,368.40
# Revenue Analysts 2 2 2
Mean Target Price 109.25
Mean Cash Flow 11.18 12.10 13.63
Mean EBITDA 3,849.00 4,261.90 4,602.10
Mean Net Income 2,316.50 2,291.60 2,502.00
Mean Debt Outstanding
Mean Tax Rate 27.40 25.00 25.00
Mean Growth Rate 4.34
Mean Capital Expenditure 224.00 330.20 560.20

Company Overview (DXC:NYS USD)

Price 89.99
Range 88.14 – 93.37
52 week 74.10 – 107.31
Open 92.89
Vol / Avg. 5.92M/1.26M
Mkt cap 25.7B
P/E 29.41
Div/yield 0.76/0.01
EPS -0.88
Shares 285.55M
Beta 1.15
Summary chart

Detailed Company Description

DXC Technology Co is an independent, end-to-end IT services company. It provides information technology and consulting services and solutions to enterprise clients.

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

Notice to User


The contents of this report and the Stockcalc website are provided on an ‘‘as is’’ or ‘‘as available’’ basis with all faults and may not be current in all cases. The information in this report or on the website is subject to continuous change and Patchell Brook Equity Analytics Inc. assumes no responsibility to update or amend such information or that the information will be current. Patchell Brook Equity Analytics Inc. does not claim that all information, calculations or opinions presented in this report or on its website are true, reliable, or complete. Accordingly, you should not rely on any of the information as authoritative or as a substitute for the exercise of your own skill and judgment in making an investment or other decision. Any information, data, opinions, calculations or recommendations provided by third parties through links to other websites or otherwise made available through this report or website are solely those of the third party and not of Patchell Brook Equity Analytics Inc. Please refer to the Terms of Use on www.stockcalc.com for further information.
To access all of the tools on Stockcalc, including more detailed valuation reports and the models used to generate these valuations, please subscribe for a free 30 day trial of Stockcalc here.