Amdocs Limited Earnings Missed Analyst Estimates: Here’s What Analysts Are Forecasting Now

One of the biggest stories of last week was how Amdocs Limited (NASDAQ:DOX) shares plunged 30% in the week since its latest full-year results, closing yesterday at US$43.83. Revenues were in line with forecasts, at US$4.7b, although statutory earnings per share came in 15% below what the analysts expected, at US$4.68 per share. This is an important time for investors, as they can track a company’s performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Taking into account the latest results, the five analysts covering Amdocs provided consensus estimates of US$4.49b revenue in 2027, which would reflect a small 4.3% decline over the past 12 months. Per-share earnings are expected to grow 14% to US$5.43. Before this earnings report, the analysts had been forecasting revenues of US$4.85b and earnings per share (EPS) of US$6.72 in 2027. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

Check out our latest analysis for Amdocs

The consensus price target fell 7.9% to US$73.00, with the weaker earnings outlook clearly leading valuation estimates. The consensus price target is just an average of individual analyst targets, so – it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Amdocs at US$105 per share, while the most bearish prices it at US$46.00. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Amdocs’ past performance and to peers in the same industry. We would highlight that revenue is expected to reverse, with a forecast 4.3% annualised decline to the end of 2027. That is a notable change from historical growth of 1.1% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 14% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining – Amdocs is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. Furthermore, the analysts also cut their price targets, suggesting that the latest news has led to greater pessimism about the intrinsic value of the business.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year’s earnings. At Simply Wall St, we have a full range of analyst estimates for Amdocs going out to 2029, and you can see them free on our platform here..

You can also see whether Amdocs is carrying too much debt, and whether its balance sheet is healthy, for free on our platform here.

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