Amdocs slumps, plagued by slow growth and AI

The share price of Israeli tech company Amdocs (Nasdaq: DOX) fell 6.3% on Wall Street on Thursday (Friday was a public holiday) to complete a 35.5% fall since the start of 2026. The share price is at a six-year low and the last time it was at this level was after the outbreak of the Covid pandemic, which briefly sent the markets into a tailspin.

Amdocs share price recovered quickly during the Covid pandemic and by 2023, the share price peaked at nearly $100. Since then the stock has fallen almost 50%, giving a market cap of $5.5 billion.

Amdocs provides technology and software solutions for telecom and media companies. No reports were published last week that might explain the recent weakness in the stock, but the weak sentiment in recent months can be explained by a combination of several factors.

Amdocs is led by CEO Shimie Hortig, who recently succeeded Shuki Sheffer, who served for 8 years. CFO and COO Tamar Rapaport-Dagim has also announced her retirement after 19 years, and will be replaced by Tal Rosenfeld.

The company’s reports to the US Securities and Exchange Commission (SEC) indicate that since the CEO change was reported, previous CEO Sheffer has sold Amdocs shares he owned for $17.5 million, on three different trading days.

After announcing her retirement, “Globes” asked Rappaport-Dagim was asked whether the change of two senior executives in a short period of time would not add to the uncertainty and weigh on the stock. She replied, “A change of management is always an event, we will not ignore it. But there is a long-term preparation process here, and two appointments of very senior people.”

Laying off 10% of employees

Along with the changes at the top, Amdocs, like many companies, is also suffering from market concerns about the effects of AI on its operations and business model (although as a company that specializes in a specific market, it has long-term relationships with customers and unique expertise, which could perhaps mitigate potential harm).

Amdocs itself is investing in AI, and analysts believe it has an opportunity in the field. For example, last month, Oppenheimer noted that Amdocs’ new AI platform (aOS) is still in the early stages of penetration, and the long-term opportunity of AI and automation is not reflected in their assessment of the current stock pricing. Amdocs recently carried out a round of layoffs of about 10% of its employees (including, according to estimates, hundreds of employees in Israel), with the reasons given for this being adapting processes to the AI era and a desire to make the company more flexible.

Amdocs to lay off 3,000 employees

Another factor that could weigh on the stock is the issue of growth. Amdocs is growing sluggishly. In the first half of fiscal year 2026 (until the end of March 2026), revenue was 4% higher, and the company’s forecast is for growth of 2.6%-4.6% for the entire fiscal year. This follows a 9.4% drop in revenue last year following the discontinuation of less profitable activities. The company does pay a dividend and buys back its own shares, but growth is a weak point.

Price target double the current market price

Amdocs ended the first half of this fiscal year with revenue of about $2.3 billion, net profit of $297 million and positive cash flow of about $322 million from operating activities. During the second quarter, it purchased $138 million of its shares and this month it will distribute a dividend of about $0.57 per share (about $61 million).

There are currently seven analysts covering Amdocs stock, of which five are positive, one neutral and one negative. The average price target of those analysts is 64.5% higher than the current price of the stock on Nasdaq. One of the analysts is investment bank Oppenheimer, and its price target is the highest, $105, more than double the current price on Nasdaq.

In a recommendation a few weeks ago, Oppenheimer wrote that the company is gradually moving forward with a new AI platform that should expand its target markets and strengthen its competitive position with increased market share. Oppenheimer added that this is not priced into the company’s market cap (which has since fallen), which provides a dividend yield of 3.7%. “We see Amdocs as a value investment,” the analysts concluded.

Published by Globes, Israel business news – en.globes.co.il – on June 22, 2026.

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