DXC Stock Soars After Firm Calls For ‘Strategic Alternatives’
DXC Technology's stock price skyrocketed by more than 18 percent on Tuesday, the day after the company disclosed plans to pursue “strategic alternatives” for three of its businesses.
DXC’s share price peaked Tuesday early afternoon at $35, up sharply from Monday's close of $29.40 per share, before moving a bit lower to about $34.50 per share late in the day.
The Tysons, Va.-based global solution provider formed in the 2017 merger of HPE Enterprise Services and CSC on Monday said it was exploring strategic alternatives for three of its businesses.
CEO Mike Salvino listed those three businesses as DXC's U.S., state, and local health and human services business; its horizontal BPS (business process services) business; and its workplace and mobility business.
These three businesses together account for about 25 percent of DXC's total revenue, Salvino said.Salvino, who in September joined DXC Technology, told investors during the company’s second quarter 2020 financial conference call those so-called strategic alternatives include a potential sale to strategic or private equity buyers or a spin-off.
"These businesses are strong," he said. "Our workplace and our U.S., state, and local health and human services businesses are market leaders. And we have meaningful IP (intellectual property) in our horizontal BPS business."
DXC expects it can generate net capital proceeds of about $5 billion for the three businesses, said Paul Saleh, executive vice president and chief financial officer at DXC Technology. Of that, DXC expects to deploy $4.25 billion or more to repurchase shares and pay dividends over the next 10 quarters, Saleh said.
DXC’s share price during the year fell as DXC weathered three major legal battles including one based on alleged management fraud, a fight with its former parent company Hewlett Packard Enterprises over an expected payment, and the replacement of its CEO.
The planned divestment of the three businesses will likely initially be a negative to DXC's credit rating given that those businesses have a higher margin profile than DXC as a whole does, according to a Tuesday report from Moody’s Investors Service.
However, Moody's said, the shift in strategy will mean DXC will be better able to turn around its declining top line and react to IT industry changes.
"DXC has been slower than other competitors, such as Accenture (Aa3 stable) or Cognizant, to react to an evolving IT services landscape but we believe the scale and depth of its customer relationships provide an opportunity to reposition the company and return to long-term growth," Moody's wrote.
source crn
Industry: Information Technology
Latest Jobs
-
- IAM Consultant- One Identity Manager- UK Wide
- Manchester
- Upto £75,000 plus excellent benefits
-
One Identity IAM consultant is needed for this expanding UK based business, you will be responsible for: Developing and Supporting the Identity and Access management system based-on One Identity products Active Roles Server and Identity Manager. Further develop One Identity Manager’s integration with Service Now to provide automated JML processes and application access requests and fulfilment. Work across the business ensuring that the IAM solutions integrates into both the technology and business systems and processes, ideally automating as mush as possible. Work with the Governance Risk & Compliance (GRC) team to provide application access attestations and toxic combination alerting and reporting. Work on a mixture of IAM related projects to help to integrate new ideas and technology into the business to ensure the business stays fully compliant Assist in ensuring that all IAM capabilities are mapped to internal processes, policies, and standards. Develop metrics to measure and improve and also compile reports around the solution If you are interested in this opportunity we are looking for someone who is skilled within Identity Acess management, you will need to have worked with the One Identity product, ideally both Active Roles Server and Identity Manager Experience in managing and integrating with Microsoft systems (on-premise and cloud), such as Active Directory, Exchange, Office, SharePoint, etc.
-
- SailPoint Integration Consultant
- Unknown
- Upto £75000 plus benefits
-
SailPoint Integration Consultant. SailPoint Integration Consultant is needed for this expanding service business to help them with complex deployment with their FTSE focused customer base. They are looking for experienced SailPoint Integration Consultants who have: • Strong solution designing experience with in depth understanding of IAM concepts and thorough understanding of Sailpoint domain. • Thorough understanding of Identity and Access Governance concepts • Leading and creating Identity & Access Management (IAM) technical architecture • Secure by Design principles in Identify Access management, Privilege Access management • Familiar with cloud architectures, data management and source control from a security perspective. This is a great opportunity to join a business that is growing and looking for individuals who want to grow and develop and work on some of the most complex Sailpoint deployments.
-
- CyberArk Integration Consultant
- Greater London
- upto 75,000 plus benefits
-
CyberArk Integration Consultant. CyberArk Integration Consultant is needed for this expanding service business to help them with complex deployment with their FTSE focused customer base. They are looking for experienced CyberArk Integration Consultants who have: • Strong solution designing experience with in depth understanding of IAM concepts and thorough understanding of CyberArk domain. • Thorough understanding of Identity and Access Governance concepts • Leading and creating Identity & Access Management (IAM) technical architecture • Secure by Design principles in Identify Access management, Privilege Access management • Familiar with cloud architectures, data management and source control from a security perspective. This is a great opportunity to join a business that is growing and looking for individuals who want to grow and develop and work on some of the most complex CyberArk deployments.
-
- Penetration Tester, UK based. Ability to achieve SC clearance
- United Kingdom
- 55000
-
Experienced Penetration tester- UK based with the ability to achieve SC clearance. On-going training and development and paid certifications / renewals. Interested to hear from all areas of penetration testing, web app, infrastructure, mobile, etc. MUST have current hands on experience delivering penetration testing. Ideally from a consultancy background with experience working with multiple clients. OSCP / CREST / CHECK / Tigerscheme penetration testing experience / certifications desirable. Apply today for more details. All information kept in the strictest of confidence.