DOX
Amdocs Limited
$62.66
Stable Earnings Power
65%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Undervalued
Trading 40.4% below fair value
You pay
$62.66
Bear
$88.08
Fair
$105.20
Bull
$122.33
Bear
$88.08
+40.6%
$5.17 × 18x P/E
Fair
$105.20
+67.9%
$5.17 × 22x P/E
Bull
$122.33
+95.2%
$5.17 × 25x P/E
Key Value Driver
Normalized P/E multiple (22x base case)
Implied Market Multiple
12.1x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $81.50 from 11 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $105.20 per share.
Warnings
Dividend-based valuation: $904.65 (above our primary estimate by 714%). Large gaps may signal the dividend doesn't reflect full earning power.
Wall Street's average price target is $81.50 (from 11 analysts). Our estimate is 36% above the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples