Nomura Securities Q2 Preview on Cognizant Technology Solutions (CTSH); Top Buy in IT

Nomura Securities maintains a 'Buy' on Cognizant Technology Solutions (NASDAQ: CTSH) price target of $75.00.

Analyst, Ashwin Mehta, said, "Cognizant reports 2QFY12 results on 6 Aug. We find the risk reward favourable as the stock correction of ~20% post its 1Q results is pricing in a sharper than 2% guidance cut (on the company’s 20% revenue growth guidance for FY12F), which we believe is unlikely. We expect CTSH to grow at ~19% in FY12F, ahead of TCS/HCLT (13-14%); on such growth differentials, we find the valuation discount to TCS (~12%) and only a 10% premium to INFO (despite 2x the EPS CAGR over next 2 years) unjustified. HCLT followed by CTSH remain our top Buys in Tier-1 IT, given our view that market-share-focused names with lower margin thresholds will outperform, especially in a cost constrained environment."

For an analyst ratings summary and ratings history on Cognizant Technology Solutions click here. For more ratings news on Cognizant Technology Solutions click here.

Shares of Cognizant Technology Solutions closed at $56.28 yesterday.

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