11-06-2007, 03:29 PM
Join Date: Jul 2007
Location: Cincinnati, Ohio
Re: CTHS - Cognizant Technology Solutions Corp.
Hummm.....somehow there's subprime exposure associated with this company. They must provide services to a lot of banks:
Cognizant Technology falls on heavy volume after outlook disappoints Wall Street
November 06, 2007: 01:10 PM EST
BOSTON, Nov. 6, 2007 (Thomson Financial delivered by Newstex) -- Shares of Cognizant (NASDAQ:CTSH) Technology Solutions Corp. fell to a 15-month low Tuesday on heavy volume after the information technology company's fourth-quarter outlook disappointed Wall Street.
The Teaneck, N.J. company said ahead of the open that net income for the quarter ending September was $96.2 million, or 32 cents a share, topping the mean estimate of analysts polled by Thomson Financial was for 29 cents a share.
Revenue rose 8% above year-earlier levels to $558.8 million, topping analyst forecasts of $556.4 million.
The company said it expects fourth-quarter earnings of 34 cents, excluding stock-based compensation expenses, on revenue of $590 million to $595 million. Analysts were looking for fourth-quarter earnings of 31 cents a share on revenue of $597.6 million.
Merrill Lynch (NYSE:MER) (OOTC:MERIZ) Analyst Gregory Smith said the company deviated from its 'normal 'beat and raise'' pattern, by lifting its outlook only by the upside seen in latest quarter.
Goldman Sachs (NYSE:GS) Analyst Julio Quinteros, Jr. reiterated his buy rating, but removed the stock from the Americas Conviction Buy List, on the belief that the stock 'will likely not get the boost that we were anticipating into the end of the year' given that the company's outlook was only 'in line' with his estimate, and with expectations following third-quarter results.
Quinteros said he expects investor sentiment will be 'challenged' by concerns over the macroeconomic backdrop and the company's exposure to the troubled financial services industry.
Stifel Nicolaus said third-quarter revenue and the fourth-quarter outlook would be viewed as 'disappointing' given the 'lack of beat' and stronger quarter-over-quarter results from its peers.
The stock was down 19% at $31.99 and had hit a low of $31.15 in intraday trading, which was the lowest price seen since July 2006. Volume was 19.2 million shares, or more than 6 times the full-day average of 3.1 million shares.
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