Cognizant Technology Solutions
The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Cognizant Technology Solutions met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share improved significantly.
Margins contracted across the board.
Cognizant Technology Solutions tallied revenue of $1.66 billion. The 23 analysts polled by S&P Capital IQ expected to see revenue of $1.67 billion. GAAP sales were 27% higher than the prior-year quarter's $1.31 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.78. The 22 earnings estimates compiled by S&P Capital IQ anticipated $0.77 per share. GAAP EPS of $0.78 for Q4 were 18% higher than the prior-year quarter's $0.66 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 41.7%, 50 basis points worse than the prior-year quarter. Operating margin was 18.5%, 20 basis points worse than the prior-year quarter. Net margin was 14.4%, 130 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $1.72 billion. On the bottom line, the average EPS estimate is $0.79.
Next year's average estimate for revenue is $7.47 billion. The average EPS estimate is $3.40.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,053 members out of 1,100 rating the stock outperform, and 47 members rating it underperform. Among 331 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 318 give Cognizant Technology Solutions a green thumbs-up, and 13 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cognizant Technology Solutions is outperform, with an average price target of $82.64.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.