Johnson Fistel launched an investigation into DXC Technology after the company disclosed declining bookings, soft project demand, and a lowered revenue outlook. The law firm is probing whether DXC violated federal securities laws. Shares of the IT services company have fallen sharply from their 52-week high of $16.45.
Johnson Fistel launched an investigation into DXC Technology after the company disclosed declining bookings, soft project demand, and a lowered revenue outlook. The law firm is probing whether DXC violated federal securities laws. Shares of the IT services company have fallen sharply from their 52-week high of $16.45.
Johnson Fistel is investigating DXC Technology after the company disclosed declining bookings and a lowered revenue outlook, the law firm said Friday.
"Johnson Fistel is investigating potential securities law violations by DXC Technology," Jim Baker, a representative at the firm, said.
DXC shares closed at $8.90 on Monday, near the bottom of their 52-week range of $7.90 to $16.45. The company, which provides IT services to enterprise clients, has a market capitalization of about $1.43 billion and generated $12.64 billion in revenue over the trailing 12 months. Net income totaled $18 million over the same period, giving the stock a trailing price-to-earnings ratio of about 90 times.
The investigation adds pressure on DXC, which has seen its market value shrink as customers pull back on IT spending. The company's enterprise value of $3.97 billion represents less than one-third of its annual revenue, reflecting investor concern about its growth trajectory and debt load, with total debt-to-equity at 132 percent.
DXC has not publicly commented on the investigation. The company's disclosures about weakening bookings and project demand signal a deteriorating demand environment for legacy IT services providers as clients shift spending to cloud and AI-based solutions.
The investigation by Johnson Fistel seeks to determine whether DXC made materially false or misleading statements about its business outlook. Investors who purchased DXC securities and suffered losses may be eligible to recover damages, the firm said.
The probe threatens to deepen selling pressure on DXC shares, which have already lost more than half their value from the 52-week high of $16.45. Investors will watch for any restatement of financial results or further disclosure from the company as the investigation unfolds.
This article is for informational purposes only and does not constitute investment advice.
