This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration. Need a new registration confirmation email? Click here
Cognizant Technology Solutions (
CTSH) is a major name in the outsourced IT field, providing clients with services that range from software development to computer network maintenance. Cognizant sports a dual-pronged approach: It combines outsourced low-level services (with huge labor cost savings) with localized consulting efforts. That gives Cognizant the flexibility to market multiple services to each client it serves, and the firm earns hefty profit margins for its trouble.
The bulk of Cognizant's business is pretty simple: The company has a workforce with advanced technology expertise who work for less money than their Western counterparts. Cognizant wasn't the first Indian IT outsourcer. But it was one of the first Indian IT outsourcers to plant its base of operations here in the U.S. with a management team that's able to flatten cultural barriers to doing business from the onset.
IT spending remains one of the mission-critical costs that continues to rise right now, and as it does, so too should Cognizant's billings. The firm's nearly $3 billion in cash and zero balance sheet debt adds up to an effective 10% discount on valuation. Even though Cognizant's shares aren't exactly cheap, the price tag is offset by a breakneck growth rate and stellar management stewardship. Look out for earnings on Aug. 2.