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StockCentral :: Community
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Join in on the discussion with other like-minded investors in our community forums. Learn about the fundamental investing methodology and participate in educational workshops in the Investing forums, stay up-to-date on StockCentral news and make suggestions to the StockCentral team in Central Square, and discuss your favorite stock or recent market news in our A-Z ticker-based forums.
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jncraig
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| 09/19/2006 1:31 PM |
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| Cognizant Technology Solutions, ticker symbol CTSH on the NASDAQ, is a mid-sized company based on FY2005 revenues of $886 million. It is in the IT Consulting & Other Services industry. The company was included in the Complete Roster of Quality Companies for July 2006, with a Take Stock Quality Rating of 10.
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Zinc
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| 09/21/2006 6:14 PM |
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The performance of this stock seems to defy the logic of the guidelines we have used and taught for a long time. Specifically, the very high growth rates have been sustained for at least eight years, and show no signs of levelling off. Railroad tracks at approximately 50% for the past eight years, and closer to 60% for the last four years. BTW, CTSH business outlook remains quite positive. (BTW, I have modest holding of this stock.)
To estimate a growth rate as high as 20%, has been extremely rare for me. In this case, I suggest that using a 25 or 30% growth rate is reasonable if one changes the horizon from five years to two ot three years. Of course the key to not getting stung, is to actively manage the portfolio, a la the TK5 Alerts process. I would like to hear what growth rates others are using for CTSH . . . and why, if possible.
Zinc |
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jncraig
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| 09/21/2006 9:49 PM |
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Yes, this is very nice, Mr. Zinc!
I don't follow CTSH, but I think that maybe I should take a look.
Besides
giving CTSH a quality rating of 10, Take Stock considers it to be
overpriced and with a rising "mood." That's based on a 20% growth rate.
If
you assume that the growth were to be 40% annually, the projected high
price would be about double the present price which is in the $70s.
This would probably still be near the top of the buy range (if my
fingers are doing the arithmetic right). So, I'd be wary.
It
looks like a great company, and I want to know more. But, if I'm a
loyal BetterInvestor, this scares me. It looks like one of those that
will quadruple in a couple of years if I don't own it, and fall like a
rock if I do!
Maybe this should be an early stock for our new club to study?
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jncraig
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| 09/21/2006 10:03 PM |
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| I think that congratulations are in order, too, for your posting. I believe it's the first posting on our forums of an SSG graph that is based on the STOCKcentral data service. The source of that data is Hemscott. |
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Zinc
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| 09/22/2006 2:37 PM |
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Joe wrote:
>It looks like a great company, and I want to know more. But, if I'm a loyal BetterInvestor, this scares me.
That is indeed the conundrum. Are we disloyal if we make somewhat less conservative judgments (than taught) utilizing the five year estimating device, but guarding against implosion by a disciplined management process?
From what I read, the next couple years are firmly biased toward continued growth. The downside seeems obscure. BTW, IMO, the website, www.cognizant.com, is excellent. Navigation is a joy. The scope of what they do should impress the most jaded.
I first became interested in CTSH upon reading Tom Friedman's "The World is Flat". INFY is a similar story. The global impact of science and engineering education, and the resultant capabilities and econiomic growth in India, China and Russia is terribly difficult to track and to absorb. On the other hand, we cannot, or should not, live in isolation. Too big an opportunity loss.
Zinc |
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Karen OBoyle
Denver, Colorado
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| 10/24/2006 3:22 PM |
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| What a great site this is going to be - I very much like the vision of what this will become. Its a further bonus to find you here, Mr. Z.
You spoke at a November EduFest in Denver 2 years ago and mentioned CTSH. I did my "do dilly" and liked what I saw. Since then CTSH has been the best performer in my portfolio - so Thanks! It was good to read that this company has perhaps two more years of high growth. (Each qtr. I expect the SSG to show 'overvalued' but it hasn't happened!) I see the analysts raised estimates for 2007 to $2.00 - up 38% yoy and 2008 to $2.55 - up 27% yoy. Enjoy!
Karen OBoyle |
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Karen OBoyle |
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Karen OBoyle
Denver, Colorado
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| 10/26/2006 4:54 PM |
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| Here's my SSG - its more optimistic than yours Zinc, and I,too, think that active portfolio management with this company is imperative. I base my revenue figures on the fact the company raised guidance for the remainder of their fiscal year, they have strenghtened their partnership with SAP, they have 56 new customers so far this qtr. and a healthy cash position.
The downside is their reliance on a few accounts, their top 5 customers account for 30% of their revenue. (I hope this upload works.)
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 Attachment: CTSH.SSG
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Karen OBoyle |
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Rajiv Roy
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Rajiv Roy
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| 10/31/2006 10:52 PM |
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Hi Zinc,
I bought a fair amount of INFY shares about a week before 9/11. WIthin 3 months stocks had dropped in half. I was tempted to buy more but my portfolio would have been lopsided.
Anyways I hung on to it. INFY has done 4X for me.
Another Taiwanese company I have hung to for the longest is TSM - taiwan Semiconductor Manufacturing. Quite simply they have beocme the leader by far in foundry business for semiconductors.
Rajiv
www.stockfundas.com
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Rajiv
www.stockfundas.com
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Seymour Zeenkov
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| 11/10/2006 2:01 PM |
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Rajiv,
Looked at the CTSH SSG on your site. Very nice. I was interested in your analysts estimates. Are you willing to share with me the source? (I won't tell anyone else)
Thanks for your mresponses.
Zinc |
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Rajiv Roy
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| 11/10/2006 10:09 PM |
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Zinc,
I would love to claim some ownership for the estimates. I cannot. They were straight from kathy's SSG file that was attached to her post.
Rajiv
www.stockfundas.com
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Rajiv
www.stockfundas.com
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Richard Yurick
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| 11/27/2006 11:18 AM |
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I experimented with covered calls and lost my Ctsh this month by $0.25! Had it for 2.5 yrs. I was also starting to wonder when it will slow down. May get back in if it falls to hi 60s.
R. Yurick |
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armin fields
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| 06/20/2007 9:10 PM |
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In the INFY forum/folder, Rajiv Roy recently wrote: << CTSH is a valid alternative to INFY >>
I think CTSH is overvalued while INFY and WIT are not. My last SSG for CTSH in late May got a Forecast Hi Price that was 22% higher than VL’s estimated Hi Price of $120-180 along with only a 2.5 Upside/Downside Ratio. Note also that CTSH showed its super-hot volatility in May and declined some $15 per share, mostly after the company warned that Sales growth would slow.
VL’S 5-25-07 report observed that CTSH has “higher-than-average volatility”. A year earlier, VL noted that CTSH has been “a favorite of momentum investors, which is evident in the score for Price Growth Persistence.” That score was 95% on 5-27-05, 100% on 5-26-06, and 95% on 5-27-07.
Momentum investors scare me as they will unload a stock super-quick when the momentum shifts. They seem like speculators, not long-term investors, and I don’t want them or anyone else to be in control of my investments.
INFY seems like a much better choice as does WIT.
Armin Fields |
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Armin Fields
check out my SSG blog at
http://arminfields.wordpress.com |
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