Bullish trading/investing strategies
DXC helps Fortune 1000 firms do relatively simple things like run their back offices, as well as very difficult tasks like writing sophisticated software. Operates two segments of its business Global Business Services (GBS) and Global Infrastructure Services (GIS.)
Opportunity / Setup / investment Thesis
Original spinoff/merger rationale that created DXC failed to deliver. Watched $25Billion revenue evaporate and near future shows no signs of slowdown. 2019 was the year of lower margin business mod and 2020 was the accelerant towards a worsening entity despite significant growth IT industry for digitization/Internet of Things/Web 4.0
Catalyst / Why now
Assets sales, continued share buybacks to significantly reduce outstanding shares, reinstitution of suspended 2020 dividends
A focus on increasing free cash flow for the long term, continued asset sales to improve top line profit margins along with access to capital debt markets for more meaningful near term share buybacks and dividend reinstatement to return capital excess capital to shareholders.