UPDATE 2-Cognizant profit beats estimates, ups FY view

* Q3 adj EPS $0.69 vs est $0.60

* Q3 rev up 10 pct sequentially

* Ups FY EPS to at least $2.50
(Adds details, analyst comment from note)

Nov 1 (BestGrowthStock) – Cognizant Technology Solutions Corp
(CTSH.O: ) reported a quarterly profit that topped market
estimates for the seventh straight quarter, showing that the
rebound in technology spending on financial services — its
biggest market — was holding firm.

The IT services provider also raised its full-year earnings
and revenue outlook.

Cognizant expects 2010 earnings of at least $2.50 per
share, excluding items, on revenue growth of at least 38.8
percent. It had earlier forecast earnings of $2.42 per share,
excluding items, on revenue growth of at least 36 percent.

Ahead of the results, StarMine SmartEstimate had projected
full-year earnings of $2.29 per share.

Growth in the third quarter was broad-based — across
industries, service lines and geographies, Cognizant said.
About 79 percent of revenue came from North America in the
second quarter.

Sequential revenue growth at New Jersey-based Cognizant —
whose majority of employees and development centers are based
in India — came in at 10 percent, ahead of average analysts’
estimates of 6 percent growth.

For the September quarter, India’s Tata Consultancy
Services (TCS.BO: ) posted 12 percent sequential growth based on
U.S. GAAP, while Infosys Technologies (INFY.BO: ) saw
quarter-on-quarter growth of 10.2 percent. Wipro (WIPR.BO: ) grew
at about 6 percent.

“As evidenced by robust third-quarter results, Cognizant
continues to maintain its sector-high revenue growth premium
over its peers,” Cowen & Co analyst Moshe Katri wrote in a note
to clients.

Third-quarter net income rose to $203.7 million, or 66
cents a share, from $136.6 million, or 45 cents a share, a year
ago.

Excluding items, earnings were 69 cents a share.

Revenue was $1.22 billion, up 10 percent sequentially and
up 43 percent year-over-year.

Analysts expected earnings of 60 cents a share, excluding
exceptional items, on revenue of $1.18 billion, according to
Thomson Reuters I/B/E/S.

Cognizant shares closed at $65.19 Friday on the Nasdaq. The
stock, valued at $19.6 billion, has gained 22 percent since
reporting record second-quarter results in August, topping a 5
percent rise in the broader S&P 500 index (.SPX: ).
(Reporting by S. John Tilak in Bangalore; Editing by Roshni
Menon)

UPDATE 2-Cognizant profit beats estimates, ups FY view