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Yahoo
25-07-2025
- Business
- Yahoo
UIS vs. DXC: Which IT Services Stock is the Better Buy Now?
Unisys Corporation UIS and DXC Technology Company DXC are two legacy players in the global IT services space, both undergoing significant transformations to stay relevant in an era driven by digital modernization, cloud migration and AI-driven solutions. For investors seeking exposure to the IT services sector, the key question is: Which of these under-the-radar tech stocks offers a more compelling risk-reward profile right now? Let us break down the fundamentals, growth outlook and valuation to determine the better buy. Case for UIS Unisys is showing encouraging momentum in business development, particularly through significant growth in total contract value, which rose 50% sequentially and more than 80% year over year in first-quarter 2025. Much of this was fueled by new logos and demand for its device subscription services (DSS), which offer streamlined, AI-friendly device provisioning and endpoint wins, including a contract to manage 380,000 devices for a global tech firm, are expected to ramp up revenues over time. Additionally, field service volumes are benefiting from a delayed but strengthening PC refresh cycle linked to Windows 11 upgrades, enhancing infrastructure services company's Cloud, Applications & Infrastructure segment is also benefiting from heightened demand for cybersecurity and application modernization. Unisys launched its first post-quantum cryptography solution and signed a notable security services deal with a major Latin American power it is advancing AI adoption through agentic AI and its service experience accelerator, which leverages generative AI and workflow automation. These tech-forward efforts are helping reposition Unisys as a more relevant, solution-oriented partner to enterprise and government broader strategic execution is guided by its 'Clear Path Forward 2050' framework, which focuses on expanding proprietary software capabilities, modernizing infrastructure, and delivering specialized consulting and managed services. The strategy has gained traction, as reflected in improved industry recognition, Dell Titanium partner status and a growing backlog of $2.9 billion. Strong cost discipline, increasing associate utilization, and a resilient portfolio of long-term, geographically diversified contracts are further supporting financial stability and margin Unisys has been positive about its long-term prospects, it is facing short-term revenue challenges due to delays in its license and support business, along with reduced discretionary spending in its other segments. Overall, macroeconomic uncertainties continue to cause some deal delays, which may marginally affect short-term revenue recognition. Case for DXC DXC Technology is gaining momentum in its turnaround, driven by operational discipline and leadership changes under CEO Raul Fernandez. The company reported a strong book-to-bill ratio of 1.2 in fourth-quarter fiscal 2025, reflecting solid demand and a 20% year-over-year increase in bookings. Wins like the Carnival Cruise Line deal highlight improved competitiveness in securing large, strategic contracts, particularly in its Consulting & Engineering Services company is also capitalizing on the enterprise shift toward AI. By integrating GenAI into modernization, testing and automation offerings, DXC is delivering tangible value to clients. Its ability to combine infrastructure expertise with AI-driven solutions positions it well in a rapidly evolving tech landscape. Its scale and cross-industry experience enhance its appeal for complex transformation DXC Technology ended fiscal 2025 on a stronger footing, with $1.8 billion in cash and $687 million in free cash flow. Debt reduction and improved working capital discipline are enabling reinvestment in growth initiatives. Planned share repurchases and long-term equity incentives for executives signal growing confidence in the company's strategic direction. How Does Zacks Consensus Estimate Compare for UIS & DXC? The Zacks Consensus Estimate for Unisys' 2025 EPS implies a year-over-year increase of 28.9%. Earnings estimates for 2025 have been unchanged in the past 60 days. Image Source: Zacks Investment Research The Zacks Consensus Estimate for DXC Technology's fiscal 2026 EPS indicates a year-over-year decline of 11.1%. However, earnings estimates for 2025 have witnessed upward revisions of 0.7% in the past 60 days. Image Source: Zacks Investment Research Price Performance & Valuation The UIS stock has declined 30% in the year-to-date period. Meanwhile, DXC shares have dropped 27%. Price Performance Image Source: Zacks Investment Research UIS is trading at a forward 12-month price-to-earnings ratio of 4.54X, below its one-year median of 10.29X. DXC's forward sales multiple sits at 4.79X, below its median of 6.27X over the same time frame. P/E (F12M) Image Source: Zacks Investment Research End Notes DXC Technology appears to be the more compelling choice over Unisys at this juncture due to its clearer trajectory toward operational stabilization and strategic execution. Under refreshed leadership, DXC is showing signs of effective turnaround through stronger deal wins, particularly in high-value segments like Consulting & Engineering Services. Its focus on integrating AI into core modernization and automation offerings enhances its relevance in today's tech landscape. Furthermore, DXC Technology's disciplined financial management and commitment to shareholder returns reflect growing internal confidence. While Unisys has promising growth drivers, including innovation in cybersecurity and device services, its near-term revenue headwinds and execution risks make DXC's improving fundamentals and strategic consistency more attractive for investors seeking stability and long-term growth potential in IT services. DXC currently carries a Zacks Rank #2 (Buy), whereas UIS has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Unisys Corporation (UIS) : Free Stock Analysis Report DXC Technology Company. (DXC) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
25-07-2025
- Business
- Yahoo
Can Unisys Capitalize Early With Looming Quantum Threats?
As the specter of quantum computing edges closer to reality, cybersecurity has entered a new era—one where legacy encryption may soon be obsolete. Unisys Corporation UIS is betting on that future. In its first-quarter 2025 earnings call, the company introduced its first Post-Quantum Cryptography solution—a cryptographic posture assessment designed to help organizations identify vulnerabilities in their encryption frameworks ahead of the quantum strategic move aligns with Unisys' broader 'Clear Path Forward 2050' roadmap, which aims to modernize client infrastructure with future-proof solutions. The company's pivot toward quantum-resilient security, coupled with its growing presence in AI-enabled services, endpoint management, and data protection, could provide a differentiated edge as enterprises reassess their cybersecurity revenue declined 11.4% year over year in the first quarter, Unisys grew new business total contract value (TCV) by 80%, highlighting strong forward momentum. Management reiterated full-year guidance and sees back-half tailwinds, especially in high-margin License & Support and infrastructure field services. Its balance sheet also remains robust, with $393 million in cash and improving free cash quantum race is still in early innings, but Unisys' proactive investments suggest it's trying to be more than a follower. Whether this niche play delivers meaningful upside depends on client adoption rates, the speed of quantum innovation, and execution across its diversified mounting cyber risk and rising demand for AI-ready infrastructure, Unisys may be positioning itself early—investors just have to decide if they believe it's early enough. Rivals in the Quantum Race: How DXC Technology and Leidos Compare As Unisys moves early on quantum-resilient cybersecurity, two key competitors—DXC Technology DXC and Leidos Holdings LDOS—are also accelerating their investments in post-quantum security and AI-driven defense solutions. DXC Technology has emphasized modernizing IT infrastructure and securing hybrid environments for large enterprises, with quantum-readiness emerging as a focal point in its recent federal and financial services contracts. DXC's positioning in digital transformation makes it a natural rival to Unisys in government and enterprise sectors, where data protection is Leidos continues to expand its cybersecurity capabilities through government defense contracts, many of which now include quantum threat mitigation as a requirement. Leidos' focus on advanced threat intelligence and secure data transport challenges Unisys' ambitions, especially in public-sector security deployments. Both DXC Technology and Leidos boast stronger scale and federal exposure than Unisys, but UIS's focused innovation in quantum security could help it carve a niche if it executes ahead of DXC and Leidos. UIS Stock's Price Performance Shares of this Pennsylvania-based technology solutions company have inched up 9.6% in the past three months, outperforming the Zacks Computers - IT Services industry, but underperforming the broader Zacks Computer and Technology sector and the S&P 500 index, as evidenced by the chart below. UIS Share Price Performance Image Source: Zacks Investment Research UIS' Discounted Valuation Trend UIS stock is currently trading at a discount compared with the industry peers, with a forward 12-month price-to-sales (P/S) ratio of 0.16, as evidenced by the chart below. UIS Valuation Image Source: Zacks Investment Research EPS Trend of Unisys Unisys' earnings estimates for 2025 and 2026 have remained unchanged over the past 30 days. However, the estimated figures for 2025 and 2026 imply year-over-year growth of 28.9% and 120.7%, respectively. Image Source: Zacks Investment Research UIS stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Unisys Corporation (UIS) : Free Stock Analysis Report Leidos Holdings, Inc. (LDOS) : Free Stock Analysis Report DXC Technology Company. (DXC) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
04-07-2025
- Business
- Yahoo
How is Unisys Navigating the Shift Toward AI-Driven IT Services?
As the enterprise IT landscape rapidly evolves, Unisys Corporation UIS is making deliberate strides to reposition itself as a key player in AI-driven IT services. The company's ClearPath Forward 2050 strategy centers on embedding AI, automation and data-driven intelligence across its core offerings, from application modernization to digital workplace is leveraging AI to solve longstanding enterprise pain points such as data fragmentation, inefficient workflows and low employee productivity. Its Service Experience Accelerator, for instance, uses generative AI, analytics and workflow automation to transform traditional service desk operations. This solution is gaining traction with clients and showcases how Unisys is making AI adoption more turnkey and company is also building agentic-AI frameworks to structure unrefined data and improve decision-making. Its intelligence accelerator connects siloed datasets across hybrid environments, enabling secure and real-time insights. These innovations not only enhance Unisys' service delivery but also unlock new revenue opportunities through endpoint management, device subscription services and AI-enabled infrastructure the firm is expanding its AI credentials with industry recognition and strategic partnerships. In first-quarter 2025, Unisys was named a 'disruptor' in Avasant's AI Services Radar and continues to invest in post-quantum cryptography and threat detection solutions, critical components in the AI macroeconomic uncertainty, Unisys remains committed to refining its delivery model and investing in emerging technologies. The transformation is still unfolding, but early signs suggest Unisys is not just adapting to the AI shift, it is actively building a platform to thrive in the current scenario. Unisys strengthens its position in AI-powered IT services. The company finds itself navigating the same space as key players like and competitors such as Palantir Technologies Inc. PLTR and International Business Machines Corporation IBM, each with distinct AI Technologies continues to deepen the enterprise AI footprint through its Foundry and Gotham platforms, offering data integration and decision intelligence tools across government and commercial sectors. Its edge lies in real-time operational AI, which has been especially effective in defense, logistics and healthcare IBM leverages its Watsonx platform to drive generative AI and machine learning adoption in enterprise settings. Its longstanding enterprise relationships and hybrid cloud capabilities give IBM scale and depth, especially in regulated industries like finance and insurance. Shares of Unisys have gained 12% in the past three months compared with the industry's growth of 20.1%. Image Source: Zacks Investment Research Unisys' current valuation looks promising for investors. The stock is currently trading at a discount compared with the industry peers, with a forward 12-month price-to-earnings ratio of 4.73X. Image Source: Zacks Investment Research The Zacks Consensus Estimate for UIS' 2025 and 2026 earnings implies a year-over-year uptick of 28.9% and 120.7%, respectively. Image Source: Zacks Investment Research Unisys currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report International Business Machines Corporation (IBM) : Free Stock Analysis Report Unisys Corporation (UIS) : Free Stock Analysis Report Palantir Technologies Inc. (PLTR) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
