Cognizant Beats By 10 Cents Per Share

The stock market is pulling back this morning. The S&P 500 is currently back below 1,700. Retail stocks are under heat today as American Eagle ($AEO) reported disappointing results. AEO is down about 16% on the day. Wall Street assumes that if one company in a sector is having trouble, then they all must be in trouble. As a result, shares of Ross Stores ($ROST) are also down today. ROST is currently down about 2%. The company will report its second-quarter earnings two weeks from tomorrow.

The big economic news this morning is that the trade deficit dropped to $34.2 billion for June. That’s the lowest since October 2009. Exports rose 2.2% to $191.2 billion which is an all-time record. Imports fell 2.5% to $225.4 billion.

This trade data will probably lead the number crunchers in the government to revise the Q2 GDP figures higher. The initial report said that the economy grew, in real terms, by a measly 1.7% for the June quarter. Today’s report suggests the GDP report could be revised as high as 2.5%. The next GDP report will come out at the end of the month.

Dish Network ($DISH), the big rival of DirecTV ($DTV), reported lousy results for Q2. The company lost 78,000 customers in the quarter. There’s mounting pressure on DISH to sell itself to DTV. I don’t know if that will happen, but it’s definitely being talked about.

The best news for us today is that Cognizant Technology Solutions ($CTSH) had a great earnings report, plus they raised full-year guidance. For Q2, CTSH earned $1.07 per share which was ten cents better than the estimates. Quarterly revenue rose 20.4% to $2.16 billion which was $30 million better than expectations.

Cognizant now sees full-year earnings of at least $4.32 per share on revenue of $8.74 billion. That’s revenue growth of 19%. For Q3, CTSH sees earnings of $1.09 per share. Wall Street had been expecting $1.03 per share. Shares of CTSH are up about 2.86% today.

Posted by on August 6th, 2013 at 11:20 am


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