Market Commentary and Intraday News
Cognizant 1Q profit, revenue rise, top view
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(AP:TEANECK, N.J.) Cognizant Technology Solutions Corp., a provider of information technology, consulting and outsourcing services, said Wednesday that its net income rose 17 percent for the first quarter as revenue improved across its business segments.
Its adjusted earnings and revenue topped Wall Street's view, and the company provided second-quarter forecasts above analysts' estimates and increased the size of its stock buyback program.
Its shares climbed almost 5 percent in premarket trading.
For the period ended March 31, Cognizant earned $284.2 million, or 93 cents per share. That's up from $243.7 million, or 79 cents per share, a year earlier.
Excluding acquisition-related charges and other items, earnings were $1.02 per share.
Analysts expected earnings of 92 cents per share, according to a FactSet survey.
Cognizant's stock added $3.04, or 4.7 percent, to $67.92 about 2 1/2 hours before the market opening.
Revenue increased 18 percent to $2.02 billion from $1.71 billion. Wall Street forecast revenue of $2.01 billion.
Financial services revenue _ which comprises 42.3 percent of total revenue _ climbed 23.1 percent from a year ago. Revenue for the health care unit _ which makes up 25.2 percent of total revenue _ rose 9.1 percent from the prior-year period. Revenue for the manufacturing, retail and logistics division rose 27.2 percent. That unit comprises 21.1 percent of Cognizant's total revenue.
For the second quarter, the Teaneck, N.J., company expects adjusted earnings of $1.06 per share on revenue of at least $2.13 billion. Analysts predict earnings of 97 cents per share on revenue of $2.11 billion.
Cognizant anticipates fiscal 2013 adjusted earnings of at least $4.31 per share. It still expects full-year revenue to be at least $8.6 billion. Wall Street expects earnings of $3.98 per share on revenue of $8.63 billion.
Cognizant is also increasing the size of its buyback to $1.5 billion from $1 billion and extended its term to Dec. 31, 2014. It has repurchased $940 million shares under the program to date.
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