IT Consultant is Still a Solid Buy

03/22/2007 12:00 am EST

Focus:

Dan Sullivan

Editor, The Chartist

Ticker symbol CTSH

Dan Sullivan, editor of The Chartist, says Cognizant Technology is a solid performer on the fundamentals while it remains strong technically.

Cognizant Technology Solutions (NASDAQ: CTSH, $93) provides information technology (IT) consulting and technology services in North America, Europe and Asia. Its services include business process consulting, IT strategy consulting, technology consulting, application design, complex custom systems development and other services.

The company's objective is to be a leading provider of full life-cycle e-business and application development projects for various markets, such as financial, health care, retail and telecommunications.

Because more businesses are seeking the competitive advantages of IT outsourcing,
Cognizant has extended its geographic reach by adding or expanding centers in India, China, Europe and North America. The company's Fourth Generation Offshore Outsourcing offers seamless integration between the customer and Cognizant. Providing an in-depth local consulting presence, the company's onsite teams focus on each customer's business applications and management depth that partners closely with its clients.

For the fourth quarter ended December 31, the company earned $69.5 million, up 21% from $57.7 million during the same period in the previous year. For the full year, the company earned $232.8 million, up 40%, [while sales rose] 61% to $1.42 billion.

Despite coming under selling pressure the past few weeks, Cognizant continues to hold down the number one spot in our relative strength ratings. Since its 52-week high hit on February 22, it has declined 6.8%. Due to the general above-average volatility of high relative-strength stocks, however, it has held up fairly well. In addition it remains comfortably above its 50- and 200-day moving averages.

Subscribe to The Chartist here.

Related Articles on