DOX Overview

Amdocs Ltd Rating Update: Amdocs Ltd (DOX) received a rating upgrade from 0% to 80% based on its strong fundamentals and valuation, indicating significant interest from the Earnings Yield Investor model based on Joel Greenblatt's strategy.

IDT Corp Rating Update: IDT Corp (IDT) saw its rating increase from 80% to 90%, reflecting improved fundamentals and valuation, which suggests strong interest according to the same investment strategy.

Company Profiles: Amdocs provides software and services to communications and media companies, utilizing advanced technologies like AI and cloud computing, while IDT offers fintech and communication solutions, including payment processing and cloud services.

About Joel Greenblatt and Validea: Joel Greenblatt is known for his "Magic Formula" investment strategy, which has historically outperformed the market, and Validea is an investment research service that analyzes stocks based on the strategies of successful investors.

Current Stock Performance: Amdocs stock has seen a slight increase of 0.4% over the past week but is down 9.1% year-to-date, closing at $76.48. Despite short-term volatility, the company is gaining attention for its partnerships and cloud service expansions.

Valuation Insights: A discounted cash flow (DCF) analysis suggests Amdocs is undervalued by 40.8%, with an estimated intrinsic share value of $129.26 compared to its current price. The company is also trading at a lower price-to-earnings (PE) ratio of 14.9x, significantly below industry averages.

Narratives Approach: The article introduces "Narratives," a method that connects a company's story with financial forecasts and fair value, helping investors interpret data more personally. Different investor perspectives on Amdocs' future value range from $85 to $129 based on growth expectations and risks.

General Disclaimer: The analysis provided is general and based on historical data and forecasts, not intended as financial advice. Simply Wall St does not hold positions in the stocks mentioned and encourages readers to consider their own financial situations.

Put Contract Overview: The $60.00 put contract for DOX has a bid of 90 cents, allowing investors to buy shares at a lower cost basis of $59.10, which is attractive compared to the current price of $74.57. There is an 83% chance the contract may expire worthless, offering a potential 1.50% return on cash commitment.

Call Contract Overview: The $80.00 call contract has a bid of $2.40, allowing investors to sell shares at that price if they purchase at $74.57. This could yield a total return of 10.50% if exercised, with a 58% chance of expiring worthless, providing a 3.22% additional return.

Volatility Insights: The implied volatility for the put contract is 35%, while for the call contract it is 25%. The actual trailing twelve-month volatility is calculated at 22%, indicating lower market fluctuations than implied.

YieldBoost Concept: Both put and call contracts offer a "YieldBoost," with the put providing a 2.30% annualized return if it expires worthless, and the call offering a 4.94% annualized return under similar conditions.