Needham & Company Upgrades Cognizant Technology Solutions (CTSH) to Strong Buy; Secular Should Trump Cyclical
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Price: $67.44 +0.46%
Rating Summary:
12 Buy, 25 Hold, 6 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 17
Rating Summary:
12 Buy, 25 Hold, 6 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 17
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Needham & Company upgraded Cognizant Technology Solutions (NASDAQ: CTSH) from Buy to Strong Buy with a price target of $100.00.
Needham analyst says, "Our checks on the demand and supply side for the offshore IT services group continue to come in positive through the end of August, with no noticeable change in customer decision times and company campus hiring plans. We believe in a slow growth climate or even a mild recession, Cognizant and the industry can continue to grow at or above trend as CIOs continue to leverage low-cost offshore resources to reduce costs and increase efficiencies. While about half of Cognizant’s business falls in the cyclical bucket and is sensitive to a slowdown in IT spending, Cognizant has consistently demonstrated the ability to deliver strong growth through lean economic periods with growth only falling below trend during periods of extreme uncertainty, namely post-9/11 and post-Lehman."
"With valuation near a historical low (excluding the peak of the 08-09 recession i.e. 3Q08-2Q09) and the potential for sustained revenue and EPS outperformances through 2H FY11 and FY12, we believe the risk-reward is heavily skewed to the upside. Cognizant remains our Top Pick with a $100 target."
For more ratings news on Cognizant Technology Solutions click here and for the rating history of Cognizant Technology Solutions click here.
Shares of Cognizant Technology Solutions closed at $63.45 yesterday.
Needham analyst says, "Our checks on the demand and supply side for the offshore IT services group continue to come in positive through the end of August, with no noticeable change in customer decision times and company campus hiring plans. We believe in a slow growth climate or even a mild recession, Cognizant and the industry can continue to grow at or above trend as CIOs continue to leverage low-cost offshore resources to reduce costs and increase efficiencies. While about half of Cognizant’s business falls in the cyclical bucket and is sensitive to a slowdown in IT spending, Cognizant has consistently demonstrated the ability to deliver strong growth through lean economic periods with growth only falling below trend during periods of extreme uncertainty, namely post-9/11 and post-Lehman."
"With valuation near a historical low (excluding the peak of the 08-09 recession i.e. 3Q08-2Q09) and the potential for sustained revenue and EPS outperformances through 2H FY11 and FY12, we believe the risk-reward is heavily skewed to the upside. Cognizant remains our Top Pick with a $100 target."
For more ratings news on Cognizant Technology Solutions click here and for the rating history of Cognizant Technology Solutions click here.
Shares of Cognizant Technology Solutions closed at $63.45 yesterday.
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