Amdocs Ltd. (DOX) and Vesta Corporation, a leading player in electronic payment solutions, collaborated to help mobile service providers in providing an improved customer service to the prepaid users.
As per the agreement, the collaboration includes Amdocs Prepaid solution and Vesta’s Mobile Payment Platform, enabling prepaid users to change their service providers at every top-up. Amdocs Prepaid is a software solution for service creation and delivery, real-time charging and customer management.
Amdocs Prepaid offers advanced charging capabilities for the creation of classy package services (e.g. voice, data, SMS) and prepaid/postpaid payment channels. Vesta’s Mobile Payment Platform enables end-users to top-up quickly, securely and without registering through a broad selection of direct payment channels, including online, over the phone, or by an automatic procedure.
Globally, the prepaid market is gradually gaining traction, forcing the service providers to compete fiercely with each other in providing better and unique service solutions to the prepaid users.
The Vesta platform uses proprietary and patented fraud technology, which allows the service provider to decline fewer top-up requests and reduce the risk associated with non cash payments, thereby maximizing top-up revenues.
Amdocs continues to benefit from the telecom carrier industry’s long-term trend toward network consolidation and convergence. The company is currently generating more than 70% of its revenues from managed services and other recurring sources. Despite competition, Amdocs has the largest customer base and the broadest product line in the industry.
The company has several industry-leading technology integration products for managed services and large transformational projects. According to our view, long-term fundamentals of Amdocs remain firm due to the transition of telecom service providers to converged and consolidated solutions.
Nevertheless, in recent times, the company is facing softness in demand in the European regions and also in the North American regions. These two regions remain near-term concern for the company. However, Amdocs has a strong balance sheet to sustain its businesses.
We maintain our long-term Neutral recommendation for Amdocs. It is currently a short-term Zacks Rank #3 (Hold) stock.
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