| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 987.05 | -70 |
| Intrinsic value (DCF) | 963.74 | -71 |
| Graham-Dodd Method | 2.77 | -100 |
| Graham Formula | 13.44 | -100 |
Computacenter plc (LSE: CCC) is a leading global provider of IT infrastructure services, delivering end-to-end solutions across workplace, applications, cloud, networking, and security. Founded in 1981 and headquartered in Hatfield, UK, the company operates in key markets including the UK, Germany, France, and North America. Computacenter specializes in managed IT services, digital transformation, and hybrid cloud solutions, catering to enterprises seeking scalable and secure IT operations. With a strong focus on workplace modernization, data center optimization, and cybersecurity, the company serves a diverse clientele across industries such as finance, healthcare, and public sector. Its comprehensive service portfolio includes device-as-a-service (DaaS), application lifecycle management, and FinOps cloud cost optimization, positioning it as a strategic partner for businesses navigating digital evolution. As a publicly traded entity on the London Stock Exchange, Computacenter combines deep technical expertise with a capital-light consulting model, reinforcing its relevance in the fast-growing IT services sector.
Computacenter presents a stable investment opportunity with a diversified service portfolio and strong cash flow generation (GBp 417.1M operating cash flow in FY 2023). The company's low beta (0.656) suggests relative resilience to market volatility, while its healthy dividend (GBp 71/share) and net income (GBp 170.8M) underscore financial discipline. However, exposure to cyclical IT spending and currency fluctuations in European markets poses risks. The capital-light model and recurring revenue from managed services (40%+ of total revenue) provide stability, but margin pressure from competitive cloud services and dependency on third-party vendors like Microsoft and Cisco warrant monitoring. Valuation at ~2.6B GBP market cap appears reasonable given its 6.96B GBP revenue scale.
Computacenter competes in the fragmented IT services market by combining global delivery capabilities (30+ countries) with localized consulting expertise—a differentiation from pure-play outsourcing firms. Its competitive edge stems from: 1) Hybrid infrastructure specialization, bridging legacy systems with cloud-native solutions, unlike hyperscale-focused peers; 2) Tier-1 partnerships with Microsoft (Azure Expert MSP), AWS, and Cisco, enabling preferential pricing and co-selling opportunities; 3) Industrialized service delivery through proprietary tools like Cortex for IT lifecycle management. However, it lacks the pure-cloud agility of born-in-the-cloud consultancies and faces pricing pressure from Indian IT majors. In Europe, Computacenter's on-the-ground presence (particularly in DACH region) provides an advantage over US-centric competitors, though it trails in AI/ML consulting compared to Accenture. The company's security services—notably in identity governance—are a growing differentiator, contributing 18% of revenue. While smaller than global SIs, its asset-light model yields higher ROIC (15.3%) than hardware-centric peers.