Top 10 Takeaways: Intra Quarter Channel Checks
Key Data Points for Your Investment Mosaic
1. Syntel optimistic about prospects (5/14/12). Takeaways: demand environment healthy, SYNT taking market share due to client service, & earnings protection from margin flexibility exists.
2. VanceInfo reports healthy results raising top line annual guidance, but EPS guidance unchanged (5/15/12). Takeaways: demand is healthy, key continues is Margins, Margins, Margins (the ability of price increases to offset wage inflation), & VIT making progress on developing Consulting & Solutions practice.
3. Cognizant meeting reinforces earnings call commentary (5/15/12). Takeaways: key areas discretionary spending in FS (capital markets-macro) & Pharma (drug life cycle), management confident that there will be one guidance revision, & prospects for Europe & BPO healthy long term.
4. Infosys sees pick up in spending (5/15/12. Ashok Vemuri, head of Manufacturing for Infosys, stated that clients in the U.S. are starting to spend with business improving from the end of March when clients were slowing decisions.
5. WNS turnaround appears on track (5/16/12). Takeaways: management confidence regarding demand increasing, ramp in recently signed large insurance client going as planned, and currency & lower tax rate could help results.
6. Genpact's pieces for organic growth acceleration falling into place (5/16/12). Takeaways: pipelines are healthy, win rates increasing, and some signs of larger contracts developing, aggressive sales hiring should accelerate organic growth, & risk/reward appealing especially if the company can do $1.10 in 2013.
7. CSC reports results, but doesn't provide official guidance (5/17/12). Takeaways: turnaround plan includes $1 bn cost takeout and addressing 40 problem contracts. Investors will need visibility on CSC prospects before developing investment thesis.
8. Just sitting around wondering: what makes the macro environment better in the second half of the year.
9. Wipro holds its analysts day (5/18/12). WIT commentary confirms customer desire for business solutions. WIT developing domain expertise in select areas and looking to capitalize on it. More to come...
10. Boston Celtics showed up in game 3 against the Sixers. If we could only get that type of performance more than one game per series.
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Joseph D. Foresi