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Why Wipro Stock Gained 15% in April

By Demitri Kalogeropoulos - May 8, 2019 at 2:41PM

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The IT consulting giant just closed out a strong fiscal year that featured rising sales and improved margins.

What happened

Information technology consulting specialist Wipro (WIT -4.30%) outpaced the market last month as the stock rose 15%, compared to a 4% jump in the S&P 500, according to data provided by S&P Global Market Intelligence.

That rally put Wipro back ahead of the performance the market has delivered for 2019 so far. As of Wednesday afternoon, its shareholders were up about 17% for the year.

A customer service representative on the phone.

Image source: Getty Images.

So what

On April 16, Wipro delivered a generally strong report for its fiscal fourth quarter, which ended March 31. Results included a 9% sales increase and higher profitability. Between those positive trends and the impact of stock repurchases, its earnings per share jumped 38%. Wipro celebrated a few large contract wins, too, both in the U.S. and in key international markets.

Now what

The India-based consulting and business services giant is forecasting sales of between $2 billion and $2.1 billion in its fiscal first quarter, which would translate to roughly flat revenue. Still, its improving efficiency and aggressive stock buybacks are likely to power faster EPS growth. Given the strength of its contract bookings to date, it's also likely that Wipro will continue its streak of healthy sales gains in this new fiscal year.

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