Cognizant Technology Solutions
The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Cognizant Technology Solutions met expectations on revenues and met expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share increased significantly.
Margins contracted across the board.
Cognizant Technology Solutions booked revenue of $1.95 billion. The 25 analysts polled by S&P Capital IQ expected revenue of $1.95 billion on the same basis. GAAP reported sales were 17% higher than the prior-year quarter's $1.66 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 $0.92. The 25 earnings estimates compiled by S&P Capital IQ forecast $0.91 per share. GAAP EPS of $0.92 for Q4 were 18% higher than the prior-year quarter's $0.78 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 40.9%, 80 basis points worse than the prior-year quarter. Operating margin was 18.3%, 20 basis points worse than the prior-year quarter. Net margin was 14.3%, 10 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.00 billion. On the bottom line, the average EPS estimate is $0.93.
Next year's average estimate for revenue is $8.58 billion. The average EPS estimate is $4.00.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,070 members out of 1,123 rating the stock outperform, and 53 members rating it underperform. Among 303 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 291 give Cognizant Technology Solutions a green thumbs-up, and 12 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 $76.33.
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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. TMFDisclosureHere