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Shares of Cognizant Technology Solutions Corp. (CTSH – Get Report) plummeted 12.8% to $ 58.09 on Friday after IT company missed first-quarter earnings forecasts for Wall Street and reduced its outlook for the first quarter. 'year.
The Teaneck, New Jersey-based company reported net income of $ 441 million, up from $ 520 million a year ago. Adjusted earnings reached 91 cents per share, down from 94 cents a share a year ago, and analysts' forecasts were $ 1.03. Revenues reached $ 4.11 billion, but analysts' forecasts were $ 4.17 billion.
Cognizant said it expects a turnover of 4.16 and 4.20 billion USD for the current quarter, below the $ 4.29 billion Wall Street call.
Cognizant said its annual turnover was up 3.6% to 5.1%, compared to an earlier forecast of 7% to 9%. Adjusted earnings were reduced to a range of $ 3.87 to $ 3.95, down from the forecast of at least $ 4.40 in February.
"Our revised outlook for the entire year reflects the underperformance of the first quarter and the expectations of slower growth in financial and health services for the remainder of 2019," he said. said the CFO, Karen McLoughlin, in a statement.
Several analysts have downgraded their ratings on the company, including Wedbush's Moshe Katri, who downgraded Cognizant to make it neutral and lowered the price target from $ 70 to $ 70 in action. The shares have also been removed from the company's list of best ideas. In a note to investors, Katri told investors that the deterioration of the first quarter rating and the decision of new CEO Brian Humphries to "move away" from the company's financial goals from November 2018 were disclosed at the first event for Cognizant investors.
Humphries, in his first conference call since taking office on April 1, said: "we had a disappointing first quarter performance."
"We have a lot of work to do to return to what I think this company is capable of realizing to seize the opportunity of the market that presents itself to us," he said.
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