Cognizant Technology Solutions Corp (CTSH) Shares Plunge on Earnings Outlook


Shares of Cognizant Technology Solutions Corp (NASDAQ:CTSH) are trading down $4.55 or 7.77% in the pre-market this morning after the company posted better-than-expected earnings, but also gave a poor outlook.

Cognizant Technology Solutions Corp (NASDAQ:CTSH), topped earnings estimates for their fourth quarter by $0.02, reporting $0.80 per share vs. the $0.78 that analysts had been expecting. They did this on revenue of $3.23 million, missing estimates by just $0.01. With that said, the selloff was apparently sparked by the company’s guidance, which they also revealed this morning. Cognizant Technology Solutions Corp (NASDAQ:CTSH) said that they expect to earn $0.78 to $0.80 for their first quarter, compared to the $0.81 per share that analysts had been predicting. Full year guidance also came in lower than expected. The company said that they expect to earn between $3.31 to $3.44 per share in 2016, vs. the $3.47 per share that analysts had expected.

The stock closed at $58.54 during the last trading session. It is down 3.29% since July 2, 2015 and is downtrending. It has outperformed the S&P500 by 5.58%.

From a total of 10 analysts covering Cognizant Technology Solutions Corp. (NASDAQ:CTSH) stock, 9 rate it a “Buy”, 0 a “Sell”, and 1 a “Hold”. This means that 90% of the ratings are positive. The highest target price is $82 while the lowest target price is $68. The mean of all analyst targets is $77 which is 31.53% above today’s ($58.54) stock price. Cognizant Technology Solutions Corp. was the topic of 14 analyst reports since August 6, 2015 according to the firm StockzIntelligence Inc. Sterne Agee CRT initiated shares on December 17 with a “Neutral” rating. Cantor Fitzgerald initiated CTSH stock in a recent report from October 16 with a “Buy” rating. Finally, SunTrust initiated the stock with a “Buy” rating in a report they issued on a September 10.

The institutional sentiment increased to 1.18 in Q2 2015. It’s up 0.18, from 1 in 2015Q2. The ratio improved, as 55 funds sold all their Cognizant Technology Solutions Corp shares they owned while 282 reduced their positions. 87 funds bought stakes while 311 increased their total positions. Institutions now own 544.90 million shares which is 1.53% more than the previous share count of 536.70 million in 2015Q2.

New Vernon Capital Holdings Ii Llc holds 37.45% of its total portfolio in Cognizant Technology Solutions Corp, equating to 38,000 shares. Genesis Asset Managers Llp owns 9.21 million shares representing 24.65% of their total US portfolio. Moreover, Provident Trust Co has 14.06% of their total portfolio invested in the company, equating to 3.99 million shares. The Missouri-based Cortland Associates Inc Mo has a total of 10.56% of their portfolio invested in the stock. Standard Pacific Capital Llc Ca, a California-based fund reported 128,908 shares owned.

Since March 9, 2015, the stock had 0 insider purchases, and 6 insider sales for a total of $838,630 in net activity. Sinha Dharmendra Kumar sold 1,858 shares worth $126,344. Mcloughlin Karen sold 1,393 shares worth $88,804. Schwartz Steven sold 958 shares worth $60,364. Frank Malcolm sold 2,041 shares worth $126,346. The insider Coburn Gordon sold 6,446 shares worth $398,105.

Cognizant Technology Solutions Corporation is a well-known provider of information technology , consulting and business process services. The company has a market cap of $34.95 billion. The Firm operates in four divisions: Financial Services segment, which include banking and insurance; Healthcare segment, which includes healthcare and life sciences, and Manufacturing/Retail/Logistics segment, which includes manufacturing and logistics; retail, travel and hospitality, and consumer goods and Other segment, which includes Communications, Manufacturing/Retail/Logistics, and High Technology. It has 22.97 P/E ratio. The Companies competencies include business, process, activities and IT consulting, application development and systems integration, enterprise information management (EIM), application testing, application maintenance, IT infrastructure services (IT IS) and business process services (BPS).