Morningstar Rating

Stock Research and Analysis

by Peter Wahlstrom, CFA

Bulls Say

A meaningful portion of Amdocs' revenue stems from long-term service contracts with its clients, providing a recurring stream with relatively good financial visibility. Even more growth is set to come from underpenetrated emerging markets.
At roughly 7% of sales, Amdocs spends more than twice what its closest competitor does on research and development, which should keep its product line at the forefront of the industry.
Amdocs' advanced products and comprehensive solution offering should insulate it from some pricing pressures experienced by its competitors. Read more 

Bears Say

More than 30% of the company's total revenue is derived from international operations, exposing the firm to considerable foreign exchange risk, even with hedging.
Amdocs carries outsized exposure to the telecom sector and any secular problem that affects this industry may be amplified and disproportionately affect the firm.
Amdocs has relied on acquisitions in the past to expand its service offerings. There's a chance it may pay too much for future acquisitions or fail to integrate targets effectively and realize anticipated synergies. Read more 

Management

Overall we view Amdocs' stewardship of shareholder capital as standard. Amdocs is led by CEO Eli Gelman and chairman Robert A. Minicucci. Gelman took the helm when Dov Baharav retired in November 2010. Gelman, who has more than two decades of experience   Read more 

Profile

Founded in 1982, Amdocs is a leading provider of software and services to clients in the communication industry. Its solutions cover business support systems and operational   Read more 

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