Analysts have lowered their fair value estimate for Unisys from $6.75 to $5.75 per share. They cite cautious optimism regarding the company's improving revenue growth and margin outlook, while noting the need for sustained execution before recommending a higher price target.

Analyst Commentary

Analysts have offered a range of perspectives on Unisys, reflecting both cautious optimism and lingering concerns regarding the company's future performance and valuation.

Bullish Takeaways

• Bullish analysts highlight the potential for Unisys to return to growth as the broader operating environment improves.
• Recent stability in revenues, along with acceleration in bookings and new client acquisitions, is viewed as a positive sign for future performance.
• Opportunities for margin expansion are seen as likely, particularly as the company continues its ongoing transformation efforts.
• The anticipated removal of the U.S. pension plan within the next five years could address a significant overhang on the stock. This development could allow shares to re-rate higher over time.

Bearish Takeaways

• Bearish analysts remain cautious and prefer to see a sustained track record of improved execution before recommending a higher price target.
• The Hold ratings reflect uncertainty about whether the current turnaround strategy will drive meaningful long-term value.
• Cyclical industry pressures continue to weigh on growth prospects, which dampens near-term optimism.
• Despite stable revenues, there is concern that improvements may take time to translate into higher valuation without consistent operational progress.

What's in the News

• Unisys lowered its full-year 2025 constant currency revenue guidance. The company now forecasts reported revenue growth between (3.6)% and (2.6)%. This reflects revised expectations for both L&S and Ex-L&S business lines (Key Developments).
• The company reported a goodwill impairment of $55 million for the third quarter ended September 30, 2025. This is up from $39.1 million a year ago (Key Developments).
• Unisys was selected by the European Commission to lead the EUCybersafe Consortium. The company will deliver advanced cybersecurity operations for 71 EU institutions and agencies over a four-year contract (Key Developments).
• Unisys partnered with Appspace to enhance its Sustainable Workplace solution. The goal is to improve employee experience, operational efficiency, and environmental sustainability in workplace management (Key Developments).

Valuation Changes

• Fair Value Estimate: Lowered from $6.75 to $5.75 per share, indicating a more cautious view on the company's near-term value.
• Discount Rate: Increased slightly from 12.32% to 12.5%, which reflects a marginally higher required return for investors.
• Revenue Growth: Projected growth rate has risen from 3.77% to 4.37%, which suggests moderate improvement in future sales expectations.
• Net Profit Margin: Marginally higher, moving from 6.37% to 6.41%, which implies a slightly better outlook for profitability.
• Future Price-to-Earnings (P/E) Ratio: Lowered from 5.28x to 4.50x, which signals reduced expectations for future earnings multiples.