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- DXC Technology (NYSE:DXC) slipped on Wednesday, even as investment firm Citi said to buy shares of the IT services company after it confirmed it had been approached about a takeover offer.
- Analyst Ashwin Shirvaikar said that external interest on DXC Technology (DXC) makes sense, as the company's "quite significant" transformation is not reflected in its shares.
- "Specifically, we highlight the multi-year turnaround led to an improved balance sheet, sharpened offering focus, and much-improved employee and client satisfaction," Shirvaikar wrote in a note to clients, adding that the scarcity of the ITO businesses is not being recognized by the market.
- Baring Private Equity Asia is the firm reported to have made a takeover approach.
- DXC Technology (DXC) slipped 1.5% to $27 in premarket trading after rising more than 5% on Tuesday.
- Shirvaikar added that Citi's $38 price target does not include any acquisition premium or recent macro changes.
- Investment firm Stifel said earlier this week that DXC Technology (DXC) shares may not see much upside in a potential takeover.