Amdocs Limited (DOX)
UndervaluedFundamental
77
Price
$57.18
Market Cap
$6.04B
Part 1 · What the company is worth
Overview
Amdocs builds and runs the back-office software that telecom operators use to bill customers, manage their accounts and orchestrate their networks — the systems behind the scenes every time someone signs up for a phone plan, gets a bill, or has their service activated. It works for a small number of very large telecom carriers rather than for consumers, and often keeps running the software on the customer's behalf for years after installing it, rather than just selling a one-time license.
How it makes money
The larger and more stable part of revenue is managed services: Amdocs keeps operating a carrier's billing and network systems on an ongoing contract, which produces recurring, multi-year revenue. The rest comes from project work — building, upgrading or migrating these systems — which is billed as the work is done and is more irregular. Because switching a telecom operator's billing platform is a multi-year undertaking, contracts tend to run for years once signed.
Competitive moat
Switching costs · NarrowA telecom operator's billing and customer-management systems touch every subscriber and every invoice, so replacing them is a multi-year, high-risk project most carriers avoid unless forced to. That inertia favors the incumbent vendor, but it is not exclusive to Amdocs: rival providers run the same kind of systems for other large carriers and can win a contract when one comes up for renewal.
What drives demand
DefensiveTelecom operators must keep billing and serving subscribers regardless of the economic cycle, which supports the managed-services base of Amdocs' revenue. The project-based work that upgrades or migrates systems is more discretionary and can be delayed when a carrier tightens its own capital spending.
Key risks
- Revenue concentrated in a few telecom carriers — A small number of large customers, led by AT&T and T-Mobile, account for a very large share of revenue. Losing or scaling back business with any of them would be difficult to replace.
- Consolidation among telecom operators — Mergers among telecom carriers reduce the number of potential customers and can put existing contracts up for renegotiation when two customers combine their systems.
- Long, complex projects can run over budget — Large system builds and migrations for telecom operators are technically complex and multi-year; delays or cost overruns on fixed-price engagements can hurt margins.
Customer concentration
Top customers account for 45.8% of revenue
In fiscal 2025, AT&T alone accounted for 25.9% of revenue and T-Mobile for 19.9%, together nearly half of total revenue, with the ten largest customers accounting for about 70%.
The case for
Buyers argue that the shift toward managed services gives Amdocs increasingly recurring, predictable revenue, that switching costs keep long-standing carrier relationships in place for years, and that telecom operators' need to modernize network and billing systems for cloud and 5G keeps generating new project work.
The case against
Sellers fear that dependence on two customers for close to half of revenue makes results fragile to a single contract decision, that telecom industry consolidation keeps shrinking the pool of potential customers, and that large fixed-scope technology projects carry real execution risk.
Written by the editors, published on August 18, 2026
Direct competitors
Who this company fights with for the same customers
Generated on September 18, 2026 with claude-haiku-4-5 — shared with all users
Oracle Communications sells Billing and Revenue Management, order and catalogue software to the same carriers, competing head-on with the monetization products that are Amdocs' core licence business.
Netcracker sells the same cloud-native BSS/OSS stack — billing, revenue management, customer experience and network automation — to the same telecom operators Amdocs serves, and since taking CSG Systems private in May 2026 it competes with Amdocs across an even wider slice of operator IT spending.
Ericsson's Digital BSS unit bids for the same charging, billing and catalogue contracts with large mobile operators, and can bundle them with the network equipment it already sells them — exactly the 'network equipment providers that offer software systems' Amdocs names as competitors in its 20-F.
Huawei's software business supplies convergent billing and OSS platforms to carriers in Asia, Africa, the Middle East and parts of Europe, and is usually the alternative bid Amdocs faces in those markets.
Nokia's software portfolio — converged charging, monetization, service orchestration and assurance — targets the same 5G monetization and OSS budgets at the same tier-one operators.
Accenture competes for the services half of Amdocs' revenue, bidding on the same telecom systems-integration, transformation and managed-services contracts that Amdocs' 20-F lists first among its competitor types.
Balance Sheet & Liquidity
Revenue
$4.65B
Trailing 12 months (through 6/30/2026)
Net Income
$454M
Trailing 12 months (through 6/30/2026)
Free Cash Flow
$690M
Total Equity
$3.29B
Total Liabilities
$1.09B
Current Ratio
0.94
Interest Coverage
-
Debt/EBITDA
1.05
Earnings Per Share
Revenue & Net Income
Free Cash Flow
Income Breakdown
Historical statement
Margins over time
Debt over time
How heavy the debt is
Growth grid
Growth — Revenue
Fair Value Estimation
Fair Value
$77.09
Current Price
$57.18
Margin of Safety
+25.8%
Fair Value Range
$50.11 - $104.07
Spread across the valuation methods used, not a statistically calibrated confidence interval.
Estimation Methods
Valuation Metrics
P/E Ratio
13.74
ROE
13.3%
P/B Ratio
1.84
P/FCF
8.76
Gross Margin
38.3%
ROIC
15.1%
Profitability Radar
Value Creation (Economic Moat)
ROIC
15.1%
WACC
6.8%
ROIC − WACC
+8.3 pp
ROIC exceeds the cost of capital — the company is creating value for shareholders.
Fundamental Analysis Criteria
Passed (14)
- ROIC 15.1%
- Gross Margin 38.3%
- P/FCF 8.76
- P/B Ratio 1.84
- Debt/Equity ratio
- Positive Free Cash Flow
- CapEx intensity
- Current Ratio
- Debt/EBITDA
- DCF valuation (Undervalued)
- ROE 13.4%
- Analyst Consensus 64% Buy
- Earnings Quality (OCF/NI) 1.33
- Net Margin Trend 12.5% vs 9.9%
Failed (5)
- Price CAGR 0.02%
- Revenue Growth 5Y 1.7%
- Earnings Surprise avg -0.3%
- PEG Ratio 2.07
- Piotroski F-Score 2/9
Unavailable (8)
- EPS data insufficient
- Dividend Payout NaN%
- Operating Margin NaN%
- Interest Coverage
- Return on Tangible Assets
- Low reliance on intangibles
- Price below Graham Number
- Share Dilution (missing shares data)
Piotroski F-Score
Serious financial concerns
Earnings Quality
High quality: earnings backed by cash
Share Dilution
Buying back shares. Shareholder friendly
Institutional Holdings
No institutional filings reported for this company.
Governance
Executive Team
| Name | Title | Age |
|---|---|---|
| Mr. Shimie Hortig | President, CEO & Director | - |
| Mr. Tal Rozenfeld | Chief Financial Officer | - |
| Mr. Anthony Goonetilleke | Group President of Technology & Head of Strategy | - |
| Mr. Matthew E. Smith | Secretary & Head of Investor Relations | 53 |
| Idit Duvdevany Aronsohn | Head of Corporate Responsibility, Inclusion & Wellbeing | - |
| Mr. Avishai Sharlin | GM & Division President | 58 |
| Mustafa Oyumi | Head of B2B Strategy | - |
| Mr. Rajat Raheja | Division President of Amdocs Development Centre India LLP | 56 |
Part 2 · The price and when to enter
This part won't tell you whether the company is worth owning: it helps you choose when to buy it, once the fundamentals have convinced you. Inside: technical analysis, potential, historical drawdowns, gamma exposure.
Latest News
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