Amdocs Ltd. DOX reported mixed financial numbers in the third quarter of fiscal 2015 wherein earnings of 77 cents a share were in line with the Zacks Consensus Estimate.
On a GAAP basis, the company reported net income of $107.8 million or 69 cents per share compared with $109.8 million or 68 cents in the prior-year quarter.
Q3 Details
Amdocs’ total revenue came in at $907.9 million, up 0.6% year over year and also slightly above the Zacks Consensus Estimate of $907 million. Twelve-month order backlog at the end of the reported quarter stood at $3.01 billion against $3 billion in the prior-year quarter.
Amdocs posted gross margin of 34.7% in the reported quarter against 35.2% in the year-ago quarter. Operating income stood at approximately $126.7 million, up 1.4% year over year, whereas operating margin was 14% versus 13.9% in the prior-year quarter.
Segment-Wise Results
Managed Service revenues totaled $460.6 million, up 2.6% year over year. Customer Experience Solution revenues came in at $883.7 million, highlighting a 0.8% rise from the year-earlier quarter’s figure while Directory revenues grossed $24.2 million, down 5.1% year over year.
Geographically, North America generated $623.1 million, down 3.6% year over year. Europe recorded $102.3 million in revenues, up 4.8% year over year, while the Rest of the World contributed $182.5 million, up 15.3% year over year.
Financial Details
At the end of the first nine months of fiscal 2015, Amdocs generated around $565.8 million in cash from operations compared with 516.4 million at the end of fiscal 2014. At the end of the said period, free cash flow stood at $474.3 million against $438.5 million at the end of fiscal 2014. Meanwhile, at the end of the quarter under review, Amdocs had approximately $1,401.7 million in cash, cash equivalents and short-term interest-bearing investments compared with $1,424.5 million at the end of fiscal 2014.
Financial Outlook
Management expects revenues in the range of $915–$955 million for the fourth quarter of fiscal 2015. Earnings per share, on a GAAP basis, are expected between 49 cents and 59 cents while non-GAAP earnings per share are projected in the 79–85 cent range.
Amdocs expects revenue for fiscal 2015 to expand in the range of 2% to 3% from the last fiscal 2014.
Stocks to Consider
Amdocs currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the same industry are GTT Communications, Inc. GTT, Fair Isaac Corporation FICO and CDK Global, Inc. CDK. GTT Communications sports a Zacks Rank #1 (Strong Buy) while Fair Isaac and CDK Global carry a Zacks Rank #2 (Buy).
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