Is DXC Technology Company (DXC) Becoming More Panic-Prone?

Undoubtedly, DXC Technology Company (NYSE:DXC) has been one of the most volatile stocks in the market in recent times, and the way it handled Thursday’s volatility suggests the stock may be poised to decline heading into short-terms. The shares dropped -1.51 points or -2.43 percent at $60.52 with a heavy trade volume of 4.112 million shares. After opening the session at $60.62, the shares went as high as $60.87 and as low as $59.23, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $17 billion and now has 281.37 million shares outstanding. DXC Technology Company (DXC) stock has lost -15.72 percent of market value in 21 trading days.

DXC stock has a trailing 3-year beta of 1.3, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $6.38 a share in the trailing twelve months. The stock’s value has fallen -26.27 percent year to date (YTD) against a decline of -24.66 percent in 12 month’s time. The company’s shares still trade -37.45 percent away from its 1-year high of $96.75 and 5.09 percent up from 52-week low of $57.59. The average consensus rating on the company is 2.2, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.

DXC Technology Company (DXC) will probably climb 45.67 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $125-month high price target. This represents a whopping 106.54 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $86.5, which represents a return potential of 42.93 percent when compared to the closing price of the stock of $60.52 on Thursday, December 06. The lowest price target for the stock is $70 — slightly more than 15.66 percent from DXC’s current share price.

History has shown that shares in DXC Technology Company have gone up on 6 different earnings reaction days and are predicted to add 0.06 percent when the company reports upcoming earnings.

Let’s take a look at some insider activity at DXC Technology Company (NYSE:DXC) and see the pattern. The earliest insider trade took place on 09/28/2018. Lawrie John M parted with a total of 5 thousand shares of company at average share price of $93.9. The total for the sales was set at $469.5 thousand. After this transaction, the President and CEO account balance stood at 613.67 thousand shares. The stock lost -35.54 percent since that insider sale. On 09/13/2018, Lawrie John M, President and CEO, sold 30 thousand shares at a price per share of $92.37. This removed 2.77 million shares from the insider’s fortune and the stock saw a -34.47 percent retreat in value since the news became public. This transaction left 618.67 thousand shares in the President and CEO account.

On 09/13/2018, EVP & CFO Saleh Paul N performed a sale transaction worth $4.6 million. This sale at $92.03 each has eliminated 50 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -34.23 percent decrease since the transaction was reported. The insider now is left with 76.4 thousand shares remaining in the account. Saleh Paul N, who performs the EVP & CFO job, sold 4.32 thousand shares for $389.07 thousand. The disposal occurred on 09/11/2018 was priced at $90.02 per share. The share price plunged -32.76 percent since the reporting date. Saleh Paul N now left with a stake of 126.4 thousand DXC stock worth $7.65 million after the insider selling.

The stock is currently hovering around the first support level of $59.54. Below this, the next support is placed in the zone of $58.57. Till the time, the DXC stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 34.19 on daily chart, which may remain a cause for comfort. If the price breaks below $58.57 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $61.18 mark may result into a pull-back move towards $61.85 level.

Shares of DXC Technology Company (DXC) are trading at a P/E ratio of 9.5 times earnings reported for the past 12 months. The industry DXC operates in has an average P/E of 22.12. Its P/E ratio went as low as 3.86X and as high as 69.82 over the 5-year span.Further, it is sporting a 0.75 on the Price-to-Sales ratio. Compare this with the industry average P/S of 534.69. 28.7 percent is the gross profit margin for DXC Technology Company and operating margin sits at 8.8 percent. Along with this, the net profit margin is 8.2 percent.