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Wipro Ltd ADR WIT

Morningstar Rating
$6.25 +0.04 (0.64%)
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Company Report

Wipro's Moat Would Be Hard to Wipe Clean

Wipro is a leading global IT services provider with the typical menu of offerings, from software implementation to digital transformation consulting to servicing entire business operations teams. We think Wipro merits a narrow economic moat rating, similar to many of its peers, as we believe it benefits from switching costs and intangible assets, although we also see it benefiting from a cost advantage. While the company will likely struggle amid the COVID-19 pandemic, we think its stable moat trend will stay secure. Forays into the higher-value realm of industrial engineering will help ensure that Wipro does not miss out on substantial growth trends in the overall IT services industry.

Price vs Fair Value

WIT is trading at a 16% premium.
Price
$6.25
Fair Value
$8.40
Uncertainty
Medium
1-Star Price
$5.49
5-Star Price
$4.59
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Wipro could benefit from greater margin expansion than expected in our base case as more automated tech solutions decrease the variable costs associated with each incremental sale.

Bears

Wipro could suffer greater wage hikes than expected, leading to aggressive margin contraction if automation and mix shift benefits prove to be smaller in scale.

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News

Trading Information

Previous Close Price
$6.21
Day Range
$6.186.27
52-Week Range
$4.326.45
Bid/Ask
$6.17 / $6.27
Market Cap
$32.62 Bil
Volume/Avg
1.4 Mil / 2.3 Mil

Key Statistics

Price/Earnings (Normalized)
23.43
Price/Sales
3.04
Dividend Yield (Trailing)
0.19%
Dividend Yield (Forward)
0.19%
Total Yield
0.19%

Company Profile

Wipro is a leading global IT services provider, with 175,000 employees. Based in Bengaluru, this India IT services firm leverages its offshore outsourcing model to derive over half of its revenue (57%) from North America. The company offers traditional IT services offerings: consulting, managed services, and cloud infrastructure services as well as business process outsourcing as a service.
Sector
Technology
Industry
Information Technology Services
Stock Style Box
Large Core
Total Number of Employees
244,707

Competitors

Valuation

Metric
WIT
CTSH
ACN
Price/Earnings (Normalized)
23.4317.3832.35
Price/Book Value
3.912.989.97
Price/Sales
3.042.063.79
Price/Cash Flow
20.8515.8522.64
Price/Earnings
WIT
CTSH
ACN

Financial Strength

Metric
WIT
CTSH
ACN
Quick Ratio
2.171.951.18
Current Ratio
2.292.251.33
Interest Coverage
12.1265.90162.06
Quick Ratio
WIT
CTSH
ACN

Profitability

Metric
WIT
CTSH
ACN
Return on Assets (Normalized)
10.15%13.44%17.12%
Return on Equity (Normalized)
16.30%19.02%37.32%
Return on Invested Capital (Normalized)
12.16%16.62%28.70%
Return on Assets
WIT
CTSH
ACN
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Information Technology Services Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Economic Moat
Market Cap
ACN
Accenture PLC Class ANqnzg$240.6 Bil
IBM
International Business Machines CorpCgfnjy$177.0 Bil
FI
Fiserv IncCvptkb$88.6 Bil
INFY
Infosys Ltd ADRGgpwdv$81.8 Bil
FIS
Fidelity National Information Services IncRvhhn$40.0 Bil
CTSH
Cognizant Technology Solutions Corp Class AGhkhw$39.4 Bil
GIB
CGI Inc Class AXbzqv$27.1 Bil
BR
Broadridge Financial Solutions IncYycgw$24.2 Bil
EPAM
EPAM Systems IncWmczlg$17.8 Bil

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