Analyst Ashwin Shirvaikar sets a $23 price target for the billing software company's share.
"We are initiating coverage of DOX with a 2H (Hold, High Risk) rating. Many factors, such as incremental AT&T Wireless (AWE) business, could drive upside in 2005 and beyond but valuation is limiting near-term. Our price target is $23," writes Citigroup-Smith Barney analyst Ashwin Shirvaikar in initiating coverage of Amdocs (NYSE:DOX)
"Our estimates do not include the impact of possible incremental business from Cingular following its acquisition of AT&T Wireless (AWE).Other positives include DOX’s solid balance sheet and cash ,its market leadership in billing including lots of Tier 1 clients and its track record of penetrating those clients.
"Risks include client concentration, exposure to telecom, the prospect of margin-dilutive managed services deals, and an ongoing SEC investigation," the report concludes.
Citigroup estimates EPS of $1.15 for 2004 on $1.77 billion revenue; and $1.31 for 2005 on $1.89 billion.
Published by Globes [online] - www.globes.co.il - on September 2, 2004