Cognizant Technology Solutions Corporation A (CTSH) an Indian IT services company seems to be on its move. It showed up on my screener list as well as in IBD 100 list creating new highs and broke up from a flat base recently. It is a large growth (16 billion) stock and it seems to have a momentum for further growth.
I checked how the stock is trending:
A one year chart shows that the stock is in a very strong uptrend which is positive. The stock is a trending stock. The 3 year chart confirms that trend. We can see a choppy downturn during recession period, but that can be ignored as it will be seen on 5 year trend:
Five year trend shows that the stock has been trending prior the downturn and it resumed the trend when the overall trend of the market returned north.
So the stock is a trending stock. Let’s take a look at fundamental evaluation:
| |
2009 |
2008 |
2007 |
|
| Revenue |
$3,278(m) |
$2,816(m) |
$2,135(m) |
Pass |
| |
2009 |
2008 |
2007 |
|
| EPS |
1.78 |
1.44 |
1.15 |
Pass |
| |
2009 |
2008 |
2007 |
|
| ROE |
20% |
22% |
24% |
Fail |
| Analyst recommendation: |
strong buy |
Pass |
| |
12/09 |
09/09 |
06/09 |
03/09 |
|
| EPS Surprise |
+2.40% |
+9.76% |
+25.67% |
+1.88% |
Pass |
| |
2014 |
2013 |
2012 |
2011 |
2010 |
| EPS Forecast |
3.26 |
2.85 |
2.76 |
2.31 |
2.07 |
Pass |
| EPS Growth Rate (next 5 years) |
20.0% |
Pass |
| EPS / Industry (TTM) |
16.16% |
48.7% |
Fail |
| Short Interest |
1.7 days |
Pass |
| Insider Form 4 |
-181,986 |
Fail |
| Weighted Alpha |
+118.70 |
Pass |
So far the stock has received 8 point out of 12 available. That means that the stock DIDN’T PASS through my fundamental evaluation, so I am not continuing in further evaluations. Originally I was thinking to be lenient on PEG, which seems to be quite low, but such a large negative insider activity prevents me from further evaluating of the stock or being lenient in regards loosing some rules.
The next stock I wish to look at is Atheros Communications (ATHR)
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