Cognizant Earns 76 Cents per Share

I have to apologize for the lack of posting this week but I’ve had a number of projects to attend to. Nevertheless, earnings season rolls on.

This morning, Cognizant Technology Solutions (CTSH) reported Q3 earnings of 76 cents per share. That hit Wall Street’s forecast on the nose. Previously, the company had told us to expect earnings of “at least” 75 cents per share. Don’t be fooled. Matching expectations for CTSH is impressive. The company grew its revenues by 23.5% last quarter. I like this company a lot.

“Our balance sheet remains very healthy. Cognizant recorded another quarter of strong cash generation, resulting in an increase of almost $500 million in cash and short term investments,” said Karen McLoughlin, Chief Financial Officer. “Additionally, during the quarter, we repaid the $100 million balance of our revolving credit facility and repurchased over $156 million of shares under our existing stock repurchase program. Year-to-date, we have repurchased 5.3 million shares for $334 million, reflecting the confidence in our business, commitment to drive shareholder value and ability to generate strong cash flows.”

For Q4, Cognizant sees earnings of at least 77 cents per share. Wall Street had been expecting 77 cents per share. Cognizant also expects full-year earnings of at least $3.03 per share. That’s an increase from the previous guidance of at least $3 per share.

They also raised their revenue guidance to at least $12.41 billion. That would be a 21% increase over last year. Not too shabby. This is the third time CTSH has raised its revenue guidance this year.

The shares have pulled back today around 3%.

Posted by on November 4th, 2015 at 12:39 pm


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