Amdocs' Platform To Aid Sprint's IT Modernization Efforts

Amdocs (NASDAQ:DOX) announced that it is rolling out the DigitalONE platform to modernize and accelerate Sprint’s (NYSE:S) digital transformation, as part of the latter’s IT modernization efforts.

With this, Amdocs will modernize Sprint’s Commerce and Product Catalog operations, and help reduce operational expenses without compromising on quality of offerings and customer requirements.

Amdocs’ DigitalONE and scalable catalogue will enable Sprint to collate large number of catalogues to one solution. This will allow quicker delivery of more offerings and enhance operational efficiencies.

Amdocs’ alliance with Sprint is long documented. Amdocs has been providing key services including billing and customer care and managed services to Sprint for more than a decade.

Sprint & T-Mobile Merger to Boost Amdocs’ Prospects?

Notably, Sprint and T-Mobile (NYSE:S) , two of the largest carriers in the United States, are currently awaiting approval of a merger deal.

Amdocs stands to greatly benefit from this deal as both Sprint and T-Mobile are among its key customers. The combined entity would have about 127 million customers.

Historically, consolidation of media and telecom networks presents a significant opportunity for software service providers, as this leads to surge in customer care and other service requirements.

In fiscal second-quarter earnings call, management noted that during the quarter, Amdocs worked with T-Mobile and Sprint to add value to the merged entity, assuming the planned merger gets approved. This makes us optimistic about the prospects of Amdocs once the deal gets approved.

Moreover, co-activity level continues to be healthy for both customers. Recently, Amdocs entered into a multi-year agreement with T-Mobile on the licensing and distribution of premium on-demand content for the latter’s TVision Home. This also reflects the continued traction of Amdocs in the media space.

We believe that the strong co-activity with Sprint and T-Mobile, as well as the opportunities provided by the pending merger, positions Amdocs for significant growth.

Zacks Rank and A Key Pick

Amdocs currently has a Zacks Rank #3 (Hold).

A better-ranked stock in the broader Computer and Technology sector is Verint Systems Inc. (NASDAQ:VRNT) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rate for Verint is projected to be 11%, respectively.

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