Amdocs Shares Bounce Back

SAN FRANCISCO -- Shares of Amdocs(DOX Quote) rebounded Friday after the company issued a strong second-quarter earnings report and raised guidance late Thursday.

Shares in the St. Louis, Mo., software company jumped $3.79, or 13.4%, to $31.98 in recent trading. The stock had lost 19% of its value since Jan. 24, when it closed at $34.05.

Domestic cable and satellite operators and emerging-market telecoms are growth engines for the company, which sells customer relationship software for the telecom sector, CEO Dov Baharav said on the conference call Thursday.

Amdocs' second-quarter revenue grew 10% to $774.3 million, vs. revenue of $706.4 million for the same quarter of last year. Analysts had been expecting $761.7 million, according to Thomson Financial.

Net income was up 15% to $99.9 million, or 46 cents a share, from $87.2 million, or 40 cents a share, in the year-ago period.

Excluding items, EPS was 58 cents, a penny better than analysts' expectations.

Amdocs said third-quarter revenue would range from $790 million to $805 million, and EPS, excluding items, will be from 59 cents to 61 cents. Analysts were looking for a top line of $784.4 million and 59 cents a share.

The company raised full-year revenue guidance to a range from $3.09 billion to $3.15 billion, from previous guidance for $3 billion. EPS expectations, less items, were narrowed to a range from $2.31 to $2.37. The company had previously said EPS would be $2.29 to $2.39. Analysts were expecting a top line of $3.1 billion and $2.35 a share.

"We have seen little evidence of challenging economic conditions adversely affecting our customers buying decisions," Baharav said.

The consensus one-year price target on the stock is $41.50, according to Thomson. Cantor Fitzgerald raised its price target Friday to $45, from $43, according to Briefing.com.

In the telecom niche, Amdocs competes with Convergys(CVG Quote) and CSG Systems(CSGS Quote).