Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, IT specialist Computer Sciences (NYSE: CSC ) has earned a respected four-star ranking.
With that in mind, let's take a closer look at Computer Sciences and see what CAPS investors are saying about the stock right now.
Computer Sciences facts
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Headquarters (Founded)
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Falls Church, Va. (1959)
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Market Cap
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$7.08 billion
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Industry
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Information technology services
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Trailing-12-Month Revenue
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$777.58 million
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Management
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CEO Michael Laphen (since 2007)
CFO Michael Mancuso (since 2008)
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Return on Equity (Average, Past 3 Years)
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14.2%
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Cash/Debt
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$2.44 billion / $3.81 billion
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Dividend Yield
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1.3%
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Competitors
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IBM (NYSE: IBM )
Accenture (NYSE: ACN )
Infosys (Nasdaq: INFY )
Cognizant Technology (Nasdaq: CTSH )
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Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 87% of the 240 members who have rated Computer Sciences believe the stock will outperform the S&P 500 going forward. These bulls include herztical and All-Star Staka, who is ranked in the top 2% of our community.
Earlier this month, herztical tapped Computer Sciences as potential buyout candidate:
When a tech company trades for book, is profitable, and has good customers, they are a takeover target. The acquiring company cuts the expenses out and that makes the takeover accretive to earnings. ... In such a low yielding investment environment this looks like a good LBO target.
While Computer Sciences lacks the offshore presence of its larger IT service rivals, our community remains attracted the company's leading position in serving public sector clients. Thanks to solid relationships and long-term contracts with the federal government, several Fools like Computer Sciences as a powerful way to play the trend toward outsourcing. More importantly, with the stock trading at a paltry price-to-cash flow of 3.7 -- a huge discount to competitors IBM (9), Accenture (11.1), Infosys (27.1), and Cognizant (33.4) -- you won't have to pay an expensive price to do it.
CAPS All-Star TMFDeej likes, as of September 26:
- Stable growth, partly through acquisitions
- Recurring deal flow
- Good position in many government programs
- Aggressively try to get a foot into cloud computing (which might become the alternative to much of todays outsourcing business)
- Reasonable valuations
- Have considerably reduced debt over last two years
- Chart looks to break out of a downtrend channel
- Rumors on Bloomberg that they might be a target for private equity
What do you think about Computer Sciences, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
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